BrainTrust Query: I Found One
Commentary by Bill
Emerson, President, Emerson Advisors
In a recent
post, I asked the question, “Where
are the Merchants?” I am happy to
report that I found one. He is Hans Sternberg, scion of a family that started
a small shop in Germany in the 18th century, fled the Nazis in the 1930’s,
and went on to build the largest family-owned department store in the country
– Goudchaux’s/Maison Blanche, a legend on the Gulf Coast.
Hans has brilliantly
recounted this experience in a new book, “We Were Merchants.”
In the introduction,
he writes, “This book is therefore dedicated to an era when the department
store was part of the family, when youthful faces pressed against display
windows signaled the Christmas season had arrived, when someone actually
measured your foot and helped you select the perfect new shoes, when someone
getting a makeover in cosmetics could transfix onlookers, when a visit
to the toy department was mandatory if children were tagging along. It
was a period when browsers and buyers alike were greeted and remembered,
when they were treated like visiting royalty.”
I had the opportunity
to speak to Hans at length recently. Here are his views on the key
elements of retail success and its current state:
- Leadership and innovation: Hans believes this is critical to success.
You have to give the customer a reason to pick your store over your competitor
and that comes from leadership and relentless innovation. He sees
little of this today, with mostly followers and very few leaders.
- Understanding your customer: Hans feels this is another critical
element. In his view, the best merchants are those who spend as
much time as feasible in the stores listening to their customers, understanding
what they like/dislike, and what they are looking for. He worries
that the consolidation of so many retailers hinders this understanding,
with corporate offices separate from the stores and merchants that rarely
interact with customers.
- Building an exciting, memorable experience: Hans
believes that the in-store experience – visual, service levels, and displays
– are a key differentiator, regardless of what business you’re in. He
does admire some retailers, but finds them only at the high end of the
- Communicating your story: Hans’ axiom is that “you need to
advertise in good times, you MUST advertise in bad times.” He does
recognize that this is much more complicated today with the explosion
of channels. He wryly adds that adaptation is another important
element of success.
Questions: How do the merchandising skills of the department stores
of yore translate to modern-day retailing? What adjustments must be made?