Posted April 9, 2017
Several large retail stores around the region have closed in recent years or are undergoing major restructuring because of shifting consumer needs. Business and marketing departments at UW-River Falls are aware of the changing landscape and are teaching adaptation.
There are a few reasons for the recent spike in store closings, according to Michael Fronmueller, chair of the UWRF business and economics department. The first reason is it’s the time of what Fronmueller calls the wheel of retailing. Small, independent retail stores turn into larger ones and then some people decide that’s not for them anymore.
“People say this is getting impersonal. I’m not getting the service that I want or I’m not getting the specific personalized attention that I want,” Fronmueller said.
Consumers are looking for one of two things. They either want cheaper prices or they want a satisfying experience. Fronmueller used the company Wal-Mart as an example.
“They have found their price niche,” Fronmueller explained. Most people don’t expect to find a ton of customer service when they enter a Wal-Mart, he said, but they always expect low prices and in that area, Wal-Mart has succeeded.
UWRF professor Ozcan Kilic specializes in management and marketing and he agreed that purchasing habits have changed.
“There are so many different ways for companies to reach customers now,” Kilic said. Companies now have to really define their target market and figure out the best way to attract those customers.
Kilic said that younger generations have become much more likely to purchase products online, so companies have adapted.
“Nike now allows people to try on sneakers online through one of their mobile apps,” Kilic said.
UWRF offers a direct marketing course and Kilic said he thinks it gives a good base for what companies do.
“The main purpose of direct marketing is to create an immediate response. There are five venues,” Kilic said.
The five different venues for contacting consumers are mail, catalog, email, telemarketing and online marketing. But, companies can only employ these strategies after figuring out their target market. Target markets are identified by analyzing demographics, where the industry sits in terms of demand and people ready to purchase, and industry competition.
Fronmueller also said that understanding customer needs should be the first priority of any company. Market research also is important.
“It’s about balancing creativity and watching what others are doing to be successful,” Fronmueller said.
Even though it may seem as though the opportunities are decreasing, it’s actually an exciting time to be going into business, he said.
“Individuals based on their particular interest can be very successful,” Fronmueller said. Students, or anyone, going into business must understand that customer needs are always changing and they need to be ready to adapt.
The same trends that can be seen in the United States are happening globally as well.
“People in South Korea have become so busy that they can order their groceries on their phone and when they get home from work, it’s there waiting for them on their front step,” Kilic said.
Kilic, whose home country is Turkey, said that he’s amazed at the similarities when he travels back and forth between the countries. The opportunities are endless, he said, but people just have to find them.