Nikki and I are deep into writing our Store Health Assessment and I have to say the results have been surprising. Nikki has focused on writing some individual assessments, while I have been writing the aggregated results. Yet we’re both seeing the same thing.

When we first undertook this project, I worried a lot about finding ways to save money, along with recommending ways to spend it. If our survey respondents are any indicator, I was worrying needlessly. We see retailers spending time, money and payroll on tasks that just don’t add to their in-store value proposition, even as they don’t spend enough time, money and payroll on tasks, tools and technologies that would improve the in-store experience.

It’s no surprise to find retailers continuing to use promotions as a demand driver. It is a surprise to find high volume/low touch retailers (who are all about low price and convenience) believing that their “brand marketing ” is their strongest suit. I am fond of saying that marketing creates a brand promise. That brand promise is either met or broken when a shopper actually enters a retailer’s store. How well do retailers keep that promise?

In the report itself, we’ll go through three different models: high volume/low touch, low volume/high touch, and high volume/high touch. But today, I’m going to focus on high volume/low touch retailers (think “mass merchants “) and ask some pretty pointed questions.

1. If you’re all about convenience, shouldn’t your employees be focusing on keeping store shelves stocked? Shouldn’t your signage be clear and precise, helping customers find their way to what they want quickly? Shouldn’t signage also point out items currently on promotion?
2. Shouldn’t your employees have some kind of mobile app at their disposal to help shoppers locate merchandise that isn’t obviously found through signage?
3. If “low-touch ” is key to your value proposition, why would employees need access to external email?
4. How valuable is store-specific social media and web site pages to your business success?
5. If you’re all about low prices and you don’t believe having a strong merchandise procurement function is critical, how can you expect to actually be profitable?
6. How can it be that stores don’t have visibility into when shipments from distribution centers and vendors will arrive? How can managers possibly schedule labor appropriately in that environment?

I know some of these questions sound harsh, but as we are faced with a crisis around the future of the store, shouldn’t they get answered?

It’s great to see that high volume / low touch retailers are generally planning to increase their payroll-to-sales ratios over the next three to five years. Customers and employees alike would tell us that staffing levels have been pared to the bone. But we worry that new employees, or employees given extra hours will be focused on those things that create a satisfactory in-store experience.

Much to our surprise, just as there are many things we need to add, there are other processes and practices that can be put away.

I have to say, I’m loving this new methodology, called START^SM. Most of our reports are written using The BOOT Methodology^©. They are great for contextualizing business challenges, opportunities and the use of technology. They’re not going away any time soon, as we find really interesting correlations between thought processes and retailing success. But we’re not overly prescriptive in them.

START^SM is exactly the opposite. We take a known and clear problem (in this case, relevancy of the store in the digital age), and dive right into discontinuities and recommendations for change. It’s very actionable, and requires acceptance on the part of the retailer that there really is a problem to be solved.

That’s why we started with the store. It’s no secret that the store has a problem. We’ll move on to other areas next year (supply chain, anyone?), but so far, this has been a great learning experience. Stay tuned. The report will be out soon.