Jared Hanna – 216369106 Jhanna4
The introduction of ‘on demand’ movies and television programs has seen the slow but inevitable demise of our Saturday night staple, the good old video store. It didn’t take a marketing expert to predict that this new technology was going to slowly consume the classic brick and mortar video store which saw its height of popularity in the 90’s and early 2000’s.
The emergence of online shopping is beginning to follow a very similar trend, with more and more retail stores closing their doors in favour of online trading in attempt to keep up with market demands. The biggest impact has been on the major department stores which have seen a considerable decline in sales since 2009.
Enter Myer. In fact, enter Myer Werribee.
Hurting financially, with a decline in annual profits from $169 million in 2010 to $98.5 million in 2014, Myer needed to change or risk becoming the next Blockbuster video store.
In 2014, Myer launched their first brand changing strategy in over 10 years. Moving away from the tagline ‘Myer is my store’ in favour of ‘find wonderful’, Myer decided to engage with their customers and revamp the in-store shopping experience. In an attempt to lure their customers away from the keyboard and back to the stores, the brand re-launch was to incorporate a major media campaign followed by the redevelopment of their stores.
Fast forward 2 years, and head 29km’s South West of Melbourne’s CBD, and you will find the Victorian suburb of Werribee. It is here that Myer have revealed the first store to undergo their new re-branding marketing strategy.
So, Why Werribee?
Identified as a working class suburb, Myer have selected the Werribee store to be the first of many stores designed specifically to appeal to a niche segment, based on the demographics in a certain geography. Moving away from the traditional department store model of standard brands at average prices, Myer will give its Werribee store a facelift, filling its shelves with what it predicts the demographic of that area will identify as premium clothing.
In an interesting mix of a top down and bottom up strategy, Myer, led by new CEO Richard Umbers, prioritised building an environment of customer engagement based on understanding their customers and their customers’ needs by running a series of questioners and surveys in-store. These activities not only identified Myer’s target market, but also informed which products in Myer’s existing portfolio were no longer relevant to the customer they were trying to appeal to.
This market-facing strategy, built on a deep understanding of who their customer is and what they want, has resulted in Myer not only changing some of the brands its stocked but also enhancing the Myer experience. The introduction of additional touch-points in how the customer can interact with Myer, including free Wi-Fi, a café, and a ‘Click and Collect’ option be included in the Werribee Myer store model.
Myer have been able to tailor each of their individual stores to target the local shoppers, focusing on the psychology of their wants and needs. Iacobucci (2013) hit the nail on the head by identifying that customers make their purchase choices based on comparing brands. Knowing that the new age customer in their purchase cycle will likely research online, Myer Werribee will offer brands unique to its store – with both the options to purchase online and pick up at a later date.
Putting it all together
‘Find Wonderful’, although sounding like another catchy tag line, is actually a clever way Myer have assimilated with their customer. CEO Richard Umbers has described ‘Find Wonderful’ as a way of showing the customer that Myer understands what they are looking for, and the great moment of joy that comes from finding just what you want.
By stocking a range of new brands including TopShop and Veronica Maine, Myer Werribee will be looking to identify as a premium store with high quality products at a reasonable price. In an attempt to reward its shoppers and build brand loyalty, Myer have also introduced Myer one rewards. Thus, allowing the customer to gain points and be rewarded for shopping in store.
Having recently received a $370m makeover itself, the Werribee Plaza is the perfect location for Myer to place its first redeveloped store. This refurbishment of the Plaza will appeal to Myer’s customer segment and aid in Myer positioning itself as a premium store.
With a solid digital and print media campaign, including television, movie and news paper advertisements, billboards and social media, Myer have pushed the promotion of their new campaign to fully engage customers in the new strategy based on customer needs.
Will it work?
The end of the 2015 financial year saw Myer post an increase in profits, with share prices up more that 50 percent on prior year. Pushing against the trend of a brick and mortar store disappearing into an online world appear to be unconventional, but Myer may have just found the recipe for departmental survival by allowing their customers to ‘find wonderful’.
Iacobucci, D., 2014, Marketing Management (MM4): Student Edition, South-Western: Cengage Learning, Mason.
Myer Annual Report (2014). Strategy, Prospects and Risks. Retrieved 4th August 2016, http://myer2014.annual-report.com.au/operating-and-financial-review/strategy-prospects-and-risks