The Store Is Dead - Long Live the Store SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Store Is Dead - Long Live the Store
At a time when many traditional retailers are closing their physical stores, digitally native vertical brands such as Bonobos, which specializes in men's apparel, and Warby Parker, which specializes in eyeglasses, are aggressively expanding into offline locations. In this article, the authors explore two related trends: (1) the expansion of online-first retailers into offline stores that "supercharge"customer value and (2) the transformation of stores run by traditional, offline-first retailers from fulfillment-dominant centers into experience-dominant centers. As authors David R. Bell, Santiago Gallino, and Antonio Moreno note, as digitally native vertical brands have learned to build relationships with customers, traditional retailers have been reducing their store sizes and inventories and are attempting to improve and elevate the customer experience. "Showroom experiences," they write, "create better customers." When customers are exposed to the brand in a showroom, "they are better able to resolve any uncertainty about the nondigital attributes of the retailer's product."Similarly, the authors say, "showrooms create better retailers: When customers are physically present in the retail environment, observation of their behaviors can lead to meaningful insights." The authors developed their early insights into what customers value while working closely with Bonobos and Warby Parker. Through simulations, they saw that stores with smaller footprints and a higher level of service led to better results economically -improved margins, smoother logistics, and better control of inventory. They found that, rather than being dead, physical retail stores were very much alive with a profound shift in focus -from fulfillment to experience-oriented environments. The authors conclude that online-first retailers and traditional retailers have something to learn from each other. Offline-first retailers can benefit from copying the showroom concepts originated by online-first retailers; online-first retailers can benefit by opening more traditional stores.
Authors :: David R. Bell, Santiago Gallino, Antonio Moreno
Swot Analysis of "The Store Is Dead - Long Live the Store" written by David R. Bell, Santiago Gallino, Antonio Moreno includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Retailers Showroom facing as an external strategic factors. Some of the topics covered in The Store Is Dead - Long Live the Store case study are - Strategic Management Strategies, Marketing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the The Store Is Dead - Long Live the Store casestudy better are - – supply chains are disrupted by pandemic , increasing commodity prices, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion,
there is increasing trade war between United States & China, geopolitical disruptions, etc
Introduction to SWOT Analysis of The Store Is Dead - Long Live the Store
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Store Is Dead - Long Live the Store case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Retailers Showroom, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Retailers Showroom operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of The Store Is Dead - Long Live the Store can be done for the following purposes –
1. Strategic planning using facts provided in The Store Is Dead - Long Live the Store case study
2. Improving business portfolio management of Retailers Showroom
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Retailers Showroom
Strengths The Store Is Dead - Long Live the Store | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Retailers Showroom in The Store Is Dead - Long Live the Store Harvard Business Review case study are -
Successful track record of launching new products
– Retailers Showroom has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Retailers Showroom has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Highly skilled collaborators
– Retailers Showroom has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in The Store Is Dead - Long Live the Store HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Retailers Showroom digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Retailers Showroom has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Low bargaining power of suppliers
– Suppliers of Retailers Showroom in the sector have low bargaining power. The Store Is Dead - Long Live the Store has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Retailers Showroom to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Retailers Showroom is one of the most innovative firm in sector. Manager in The Store Is Dead - Long Live the Store Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Retailers Showroom is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Retailers Showroom is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Store Is Dead - Long Live the Store Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Sales & Marketing industry
– The Store Is Dead - Long Live the Store firm has clearly differentiated products in the market place. This has enabled Retailers Showroom to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Retailers Showroom to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Retailers Showroom are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Analytics focus
– Retailers Showroom is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by David R. Bell, Santiago Gallino, Antonio Moreno can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Ability to lead change in Sales & Marketing field
– Retailers Showroom is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Retailers Showroom in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Retailers Showroom in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Retailers Showroom is one of the leading recruiters in the industry. Managers in the The Store Is Dead - Long Live the Store are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses The Store Is Dead - Long Live the Store | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Store Is Dead - Long Live the Store are -
Skills based hiring
– The stress on hiring functional specialists at Retailers Showroom has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High cash cycle compare to competitors
Retailers Showroom has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Capital Spending Reduction
– Even during the low interest decade, Retailers Showroom has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High operating costs
– Compare to the competitors, firm in the HBR case study The Store Is Dead - Long Live the Store has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Retailers Showroom 's lucrative customers.
Need for greater diversity
– Retailers Showroom has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Store Is Dead - Long Live the Store, in the dynamic environment Retailers Showroom has struggled to respond to the nimble upstart competition. Retailers Showroom has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, David R. Bell, Santiago Gallino, Antonio Moreno suggests that, Retailers Showroom is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Slow to strategic competitive environment developments
– As The Store Is Dead - Long Live the Store HBR case study mentions - Retailers Showroom takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Slow decision making process
– As mentioned earlier in the report, Retailers Showroom has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Retailers Showroom even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Products dominated business model
– Even though Retailers Showroom has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - The Store Is Dead - Long Live the Store should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Retailers Showroom is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Retailers Showroom needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Retailers Showroom to focus more on services rather than just following the product oriented approach.
Opportunities The Store Is Dead - Long Live the Store | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study The Store Is Dead - Long Live the Store are -
Loyalty marketing
– Retailers Showroom has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Learning at scale
– Online learning technologies has now opened space for Retailers Showroom to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Leveraging digital technologies
– Retailers Showroom can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Building a culture of innovation
– managers at Retailers Showroom can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Retailers Showroom can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Retailers Showroom can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, The Store Is Dead - Long Live the Store, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Retailers Showroom can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Retailers Showroom to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Retailers Showroom to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Retailers Showroom can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Retailers Showroom is facing challenges because of the dominance of functional experts in the organization. The Store Is Dead - Long Live the Store case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Better consumer reach
– The expansion of the 5G network will help Retailers Showroom to increase its market reach. Retailers Showroom will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Creating value in data economy
– The success of analytics program of Retailers Showroom has opened avenues for new revenue streams for the organization in the industry. This can help Retailers Showroom to build a more holistic ecosystem as suggested in the The Store Is Dead - Long Live the Store case study. Retailers Showroom can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Retailers Showroom in the consumer business. Now Retailers Showroom can target international markets with far fewer capital restrictions requirements than the existing system.
Threats The Store Is Dead - Long Live the Store External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Store Is Dead - Long Live the Store are -
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Retailers Showroom.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Retailers Showroom in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Technology acceleration in Forth Industrial Revolution
– Retailers Showroom has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Retailers Showroom needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Regulatory challenges
– Retailers Showroom needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Retailers Showroom can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Retailers Showroom demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High dependence on third party suppliers
– Retailers Showroom high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Retailers Showroom will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Retailers Showroom with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Retailers Showroom can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The Store Is Dead - Long Live the Store, Retailers Showroom may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Increasing wage structure of Retailers Showroom
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Retailers Showroom.
Weighted SWOT Analysis of The Store Is Dead - Long Live the Store Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study The Store Is Dead - Long Live the Store needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study The Store Is Dead - Long Live the Store is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study The Store Is Dead - Long Live the Store is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of The Store Is Dead - Long Live the Store is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Retailers Showroom needs to make to build a sustainable competitive advantage.