As product managers, when we want to boost the sales of our product, one of the “levers” that we have to make this happen is the price of our product. If everything works out the way that it should, if we lower the price of our product then sales should go up. However, product managers who work for traditional retailers are discovering that for them their product development definition has changed and this lever is not working the way that it should. There are a lot of reasons for this, but the fact that their customers are starting to use more technology when they shop is part of the issue. What can be done to put control of a product’s success back in the hands of product managers?
The Problem With Pricing
The world of shopping is undergoing some significant changes. One of the biggest changes is that customers are starting to use technology as they shop more and more. This is a question that product managers are going to have to find a solution to if they want to add it to their product manager resume. The good news for retailers is that they are coming off of a good winter holiday shopping period. What this means is that they are in a much better position than they were a year ago. The combination of a strong economy and high employment means that their customers are now willing to spend. However, those same customers are increasingly using their smartphones while they shop.
The challenges that retailers are facing is being faced by everyone. This list includes Amazon, Google, Macy’s and Walmart. Although the businesses have been doing well, they all realize that they are facing greater challenges as they move forward. Retailers feel that they have enough financial resources to finally get the basics done right. This includes things like store remodels, customer service, and implementing better store technology. The thinking is that if investments are made in these areas now, then the retailers will be well positioned to compete both with each other and online.
Everyone realizes that the biggest player in this portion of the economy is Amazon. However, even for them there is no magic cure of single technology that is going to solve the problems that the retailers are going to be facing. One good example of the types of competition that is occurring is Amazon’s purchase of Whole Foods. This purchase created a race for other grocery stores to start to add home-delivery services. Amazon is starting to move into areas that used to be owned by retailers. This has caused Walmart to announce that they will be offering home delivery of groceries in 100 metro areas. At the same time, Kroger, Target, and Costco are all adding cities and products to their existing grocery-delivery services.
What Can Be Done To Boost Sales
The good news for retail product managers is that consumer spending has increased. At the same time, changes in the tax laws have resulted in lower corporate tax rates. The result of these events is that retailers now have the money to spend on both new technology and improving their stores. However, at the same time, retailers are facing profit pressures and Amazon looms as a big future competitor and these are holding retailers back.
One of the best examples of the current status of retailers is always Walmart. Currently online sales at Walmart have been slowing even though their overall sales have been strong. Walmart is working very hard to grow its online presence and has done this by purchasing Jet.com. Walmart believes that their online growth will continue to grow.
So what should the product managers at these retailers be doing? The experts say that what needs to be done is that product managers need to spend their time trying to please customers. They should not be spending their time trying to come up with ways to compete with either Amazon or Walmart despite the large investments that both of those companies are making. The thinking is that retailers are not so much behind in their competition, rather they are behind in how they care for their customers. The key is that if product managers don’t understand their customers, then no technology out there is going to help them.
What All Of This Means For You
Times are changing for retail product managers. Among all of the other changes that they are dealing with, their customers are now using more and more technology as they shop. Pricing is no longer providing product managers with a way to boost sales. Product managers will now need to look at their product manager job description in order to understand how the retail market is evolving.
Changes in the retail marketplace include customers using more technology while they shop. The good news is that currently retailers are in a good place because they had a successful winter season. Using the finances that retailers currently have they can make investments in their stores and their customer tools in order to improve their level of customer service. There is no magic cure for this problem. Amazon’s purchase of Whole Foods is a good example of the type of competition that everyone in the retail section are currently facing. Retailers have the funds to spend to deal with these issues. Retail product managers should not be worrying about Amazon or Walmart and focusing more on their customers.
Retail product managers find themselves at a special point in time. Although competition from the big boys, Amazon and Walmart, has never been greater most retailers are currently in a good place financially. They have the funds to change how they operate and do a better job of taking care of their customers. They need to find ways to change their business so that they can focus on meeting the needs of their customers better than their competition.
Question For You: How much time do you think a retail product manager should spend focusing on Amazon instead of customers?
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What We’ll Be Talking About Next Time
When you go shopping, what do you get? If you are like most of us you probably pick up some eggs, some cheese, some vegetables, and, oh yeah, some milk. However, what type of milk do you get? For a very long time our choices have been somewhat limited. We always got the same types: whole, 2%, or skim. However, some creative product managers are getting ready to change the product development definition of milk and the existing milk product managers are going to have be be ready to deal with it. What’s going on here?