Dornoff Consulting

Here is a question that often comes up, say you have found your niche but you decided you want to head a different direction, how difficult is it to transition?

The basic answer to this question is that yes you can change but you have to do it very delicately so that you do not alienate your existing market while trying to attract new customers.

Lets take a look at two examples of companies who are big but did not do a good job of transitioning.

The first is Nordstrom. Nordstrom is best know for its customer service. You will pay more to shop their but people do it for its great service. Its product line could best be described as mainstream, nothing fancy but quality product. However a few years ago corporate decided that it wanted to attract younger hipper people into the store. It changed its product lines and alienated its biggest customers. The result was that sales went through the floor and the Nordstrom family replaced some of the big decision makers.

Even the mighty Wal-Mart has failed in an attempt to change their niche. Over the last couple of years they have tried to get away from the low prices and start bringing in more main stream products. They changed their clothing lines and made other changes in attempt to get more dollars. The results speak for themselves. Wal-Mart had bad quarters especially by Wal-Mart standards, the decision makers were fired and Wal-Mart is going back to focusing on low prices.

So how do you transition?

First of all, make it a slow and steady process. Do not change everything at once but do it over a period of time. You may want to bring in a few items at a time and see how your existing customer base reacts to them.

It is very difficult to change your niche but it can be done. What you cannot do is suddenly change everything and upset your existing customers. Do it slowly and make sure that your existing customers know that your not trying to get rid of them, your just adding products to better their shopping experience.

The last few years have not been good for the founder of the big box discounter K-Mart. Sales are bad and the merger with Sears has not stopped the decline. While I do not have experience with their corporate issues, I will go over some issues I have observed in their stores, and some of things they need to do to turn things around.

Why would I go over K-Mart's problems in this blog? Simple, so that you can learn from K-Mart/Sears mistakes and show you what pitfalls to avoid. While I could write a book on their issues I will only outline the problems and give you solutions so you can apply them to your business.

Problem #1:

The first and foremost problem K-Mart has is poor customer service. They have cut store staffing to the bone and now there is not enough people to assist the customers they have. Some examples of the problems: customers cannot get help in the departments, if there is a problem at the checkouts say with a price, it takes an eternity for someone to do a price check, and employees are poorly trained and cannot deal with problems. This is just a store issue since I have seen these problems at every K-Mart I have been to in the last two or three years.

Problem #2:

The remodel that isn't. When K-Mart started to change the name of the stores to Sears Essentials all that changed was the sign on the door but nothing was done to the interior. The Sears Essentials I have been into had no interior modifications so they look like dumps. Sadly most of the K-Marts I have been into look like they haven't been cleaned in 20 years. That is a problem because it scares customers away. Just a coat of paint goes a long way to changing perceptions.

Problem #3:

They still have no idea what they are trying to be. Then again Wal-Mart is starting to have some of these problems, and Nordstrom had this problem a few years ago. K-Mart and Sears need to figure out what they want to be, what market they are going after, and go for it instead of trying to be all things to all people because it doesn't work. Target has their niche, Wal-Mart has their niche (even if they want to change it), Nordstrom has their niche and K-Mart/Sears should try to find where they fit in. I live near the first Sears Grand store and I thought it had a ton of potential but there is so many big box stores, maybe its time to go after something else?

This gives you a general idea of the problems facing K-Mart and Sears. While it is no way a comprehensive list, it does show the biggest three problems they are facing. I hope looking at their problems gives you ideas to improve your business and make your business the best it can be.

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