The Disappearing Middle

Is it really Disappearing ?

Read the following from my email last week:

The middle is dead! The middle is gone!

If you want to be successful in today's business world and economy, you have to be one of two things: the cheapest or the best.

The days are long gone when you could sell a pretty good product or pretty good service at a pretty good price, because I can get "pretty good" at a dirt cheap price. Or I can get "fantastic" at just a little more expensive price, because pretty good just isn't good enough anymore.

Look around you, go to any shopping mall. Look at the stores that do business and look at the stores that do not.

On the one hand, you have your deep discounters, such as Wal-Mart,Target, and Kohl's. But even down at this end, where price is supposedly the deciding factor, how do you explain what happened to Kmart?

Similar merchandise,similar prices, but not nearly the same results as Wal-Mart, Target, or Kohl's. Walk into a Wal-Mart,Target, or Kohl's and you'll find them well lit (you could use a pair of sunglasses in Wal-Mart) and well stocked. I don't know about you, but I've walked into quite a few Kmarts that were poorly lit, and let me tell you something about poor lighting.

When a store is poorly lit it looks dingy.When it looks dingy, it can look dirty, even if it's clean. Another thing I noticed in Kmart are what's known as "holes in the shelves." This is a retailing term signifying they're out of that item, causing a big empty space on the shelf (hence the term).

Now I don't know about you, but for me the biggest reason to go to a large discounter like Wal-Mart is that I don't have to worry they won't have what I'm looking for, since they seem to have everything.

With time becoming such a precious commodity in people's lives, do you really think people want to shop somewhere that won't have what they're looking for and they'll have to go somewhere else? So even down at the price end there's a value component.

Let's look at the other side of the coin from the cheapest--let's go to the best.These are retail stores like Nordstrom, Saks Fifth Avenue, Neiman Marcus, Lord & Taylor, along with specialty operations like Banana Republic and Abercrombie and Fitch.

Then right in the middle you have those mid-range, midprice department stores. You remember those places.Your mother used to drag you there as a kid. Thirty years ago every major city in America had at least three or four of them, and now maybe one or two are left.

They either went out of business, merged, or were taken over. What made the department stores great in their heyday was personal service.

Once the discounters started to flex their muscles by cutting price, the department stores started to do the same.The problem was, in order to cut their price, they had to cut somewhere else, and where do you think that was?

That's right, they got rid of the people who provided personal service. The customers responded predictably. They figured as long as they were going to get abused, they might as well go to a discounter and pay less for the privilege.

SALES TIP
You don't compete on what your competition does best and you don't. You compete on what you do best and they don't.


This was from:

Warren Greshes, CPAE, Speaker Hall of Fame
President
Speaking of Success
202 Telluride Trail
Chapel Hill, NC 27514
www.Greshes.com
919-933-5900, 800-858-1516 Fax; 919-933-5711

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