Guest blog post by Catherine Erdly

Community is a key success factor for retailers in 2019 and beyond

How do retailers looking forward into 2019 create strategies that will grow sales, engage their customers, and help them navigate the increasingly disrupted industry?

Having a community of customers that share the brand’s values, and believe in their mission is no longer some kind of lofty ideal, but an increasingly important part of any successful survival strategy for the majority of retail companies.

Take a look at the examples of Superdrug. They are one of the few retail businesses that actually posted positive performance this year, and not coincidentally, they are one of the few big chains who have really prioritised building their community. From Vegan Superdrug pop-ups to Shades of Beauty, a campaign to make skin and haircare for women of colour more affordable and accessible, they have engaged micro communities within their customer base.

Your community breeds your super fans

If you are competing solely on your low prices or the convenience factor, your community will not be as important. But if you are looking to compete on the strength of your brand and the superiority of your products, community is key.

Your community is a breeding ground for your super fans - those customers who will be authentic brand advocates and help spread the word.

Communities are also creating retail

The twist to this story is that increasingly, communities that have grown up around shared interests are now creating retail opportunities themselves.

Possibly the highest profile version of this is Glossier, a brand born out of a cult blog, “Into The Gloss”. Only after Into The Gloss had created a community, Glossier was born - shaped by the blog readers who helped select which products made up Glossier's small-but-perfectly-formed range.

Social Commerce is leading the way

Social commerce, or selling through social media, is fuelling this trend, making it easier than ever for communities to start selling to one another.

Depop is the perfect example of social commerce, and is now a force to be reckoned within retail. What started life as a social network for readers of PIG magazine, Depop now takes over £300m of sales each year across 10 million registered users and has revolutionised how many in Generation Z are buying clothes.

Physical Retail is the next frontier for communities that have grown up online

While Glossier and Depop have their roots firmly in the online space, both have begun the foray into physical stores, with plenty of trials and a handful of permanent stores.

However, it's not just these large brands that are making the move. Many smaller online communities are taking physical retail space, in some prime locations, to host pop-ups or longer-term physical stores.

Smaller communities are also making the leap

In these situations, the community owner takes on the responsibility for the lease, curates the brand selection and co-ordinates the physical retail space which showcases their members. It's the department-store model on a micro scale - allowing access to physical space for small brands that might otherwise not have the chance to get in front of their customers.

In London alone there are several examples of this phenomenon. The benefit of taking this approach is that not only does the community have a following, but each brand within it does too, which creates a larger network of people interested in the venture.

Community led pop-ups

The Mamahood ¹, a community run by Diana Bodega, is the perfect example. Based in East Dulwich, this pop-up showcases nearly 60 brands, all run or founded by mothers.

Lone Design Club ², founded by Rebecca Morter and Stephanie Fleming, has run a series of pop ups across London since 2016 - providing small and emerging designers with the opportunity to interact with their customers. Their latest pop-up, focused on an "anti-Black Friday" concept, is on the Charing Cross Road from 15th - 25th November.

Janet's List ³ - a website and podcast founded by Janet Oganah and showcasing brands founded and run by women of colour is also taking on physical retail space in Brick Lane from 1st - 16th December

The benefit from these ventures is not only does the community have their fans, but the brands within them also bring their own communities which creates a larger impact.

Community as the driving factor behind new retail

As these brands, both large and small, have demonstrated, entering into the world of physical retail is much harder to do without a community behind you.

My prediction is that as traditional retailers pull back from physical retail, it will be these communities, born online but ready to get in front of their customers, that will step in and take on ownership for at least some of these spaces.

And my question is whether traditional retailers are doing enough to harness the power of community, as Superdrug have done? What more can they do - should a Chief Community Officer become a reality on retailer's boards?

As we move into 2019, we shall see which retailers rise to this challenge.

Catherine Erdly

is a highly commercial retail expert with a passion for helping retailers and brands prepare for the new industry reality. An experienced public-speaker, event organiser and workshop facilitator, Catherine has a talent for bringing people together in a positive way to understand and prepare for the challenges ahead. She is the creator of the “Future of Retail” events series which over the last year have tackled some of the biggest issues facing retail today – from the impact of Brexit, the continuing dominance of Amazon and the future role of physical stores. With nearly 20 years’ retail experience across clothing, kids and home, Catherine has held senior positions in Merchandising for high street names in both the UK and the USA as well as working extensively in the start-up/SME space.

Get in touch with her here.

References

¹ The Mamahood ; ² Lone Design Club ; ³Janet’s List

While Retailers Build Communities, Communities Are Building Retail.