Years ago, before the dawn of the Internet, I was the regional manager of a consumer electronics company. I sold products to merchants throughout the Northeastern US. I sold to some interesting companies, many of whom were as creative at buying than they were at merchandising. Some of these people are now in jail (Crazy Eddie), many were left behind and went out of business (Lechmere, Caldor, Ames), and some learned to embrace the changing environment and thrive (Staples, CVS). I have to say, one of my favorite retailers of the time was Spag’s.
Spag’s was a one store wonder, the original “mass merchant” which sold everything you needed, with no frills, at a great price. It was founded by, of course, Spag, Anthony Borgatti, who opened the store in 1934. Spag was the ultimate merchant of his day. (Does anyone know if there was even a “Mr. Caldor”?) He believed in a simple principle: give the best value to your customers, build trust with your employees, and treat your vendors fairly.
Spag’s was know as “no bags Spags”, offering boxes to customers to carry out their merchandise to save overhead. They didn’t take credit cards, there were no frills in their displays, and they remained closed on Sundays so employees could be with their families. Spag’s was an integral part of the Shrewsbury/Worcester Mass community. As a customer, you always knew that you would get the best price at Spag’s. More interestingly though Spag always got the best prices from his vendors, without any wild buying tricks, Why? Because as a vendor, you were as much a part of his community as his customers. Spag always paid vendors on time, asked for minimal “market development funds”, and made selling to them enjoyable. Generally, as a vendor, you sold product to the the salesman on the floor of the store, as there were no formal buying efforts, no games, just fair deals. And if you had a chance to interact with Spag himself, it made everything you gave them worthwhile. I have a vivid memory of Spag walking into a meeting that I was having with my buyer one afternoon and starting to tell stories about his store and his life. Next thing I knew, it was 7pm on Friday night, and I was learning so much from his experience that I still didn’t want to leave.
Spag made a fortune in his store, much of which he gave back to his community through various foundations and grants. One would also often hear stories about how a family in need would see Spag himself drive up to their house in his old station wagon, leaving a crate of food and household goods at their doorstep, as anonymously as he could. He took care of his customers, community, and vendors. He was truly an amazing man.
Spag was successful because he embraced his community, developed a great reputation, gave great value, treated his employees and vendors well, all the time running a profitable business. His store was part of him, and he was a part of the community. This is the attitude that we need to be truly successful in business. With social media tools, we now have the ability to interact with our larger community just as Spag did with the Worcester community. It’s up to us to use these tools correctly
Spag himself passed away in 1996, before he had a chance to bring his community online. His daughters took over the business, and made a noble attempt at continuing the business. I even built them a website in 1997. They weren’t ready to consider eCommerce, but they used it as a means to try and communicate their values with the community. Our strategy was to leverage the Internet to allow people outside of the local newspaper area to see what was on sale each week. They had all the good intentions, but they could not make the leap as to how to extend their value and community to the web. They lost their uniqueness: They began having bags, taking credit cards, and opening the store on Sundays. The business was ultimately sold to Building 19 in 2004 and faded into the history books. If only…!!!
Spag knew how to build community the old fashioned way. Can you imagine what he could have done if he had lived to embrace the web? All the blogging and tweeting in the world can’t replace those core values of community building, but boy can they leverage it. In some ways you can argue that building an Internet Retail site and community is easier than building a retail store. All you need to do is buy some key words, do some tweeting, and put optimize your site for SEO, right? No! If you want to survive, you need to be more than the ad or the tweet of the day. While you need these tools to build awareness, you also need to build and embrace your community. You need to build trust, legitimacy, and unique values. You need to make it easy and fun to shop on your site and do business with you. You need to build a loyal following that will think of you first, turn to you for advice, and tell their friends to visit your site. Ultimately it becomes a matter of brilliant use of all you have at your disposal. Spag knew how to merchandise in unorthodox ways. But he most importantly he knew how to build the confidence of his community, and keep people coming back for more.
There is so much that can be learned from the principles that made Spag’s store successful. On the Internet, everything you do is much more transparent than before. You can learn how to use the new social media tools pretty quickly, with no instruction, and become pretty effective at it. You can implement software to have a shopping cart in a matter of hours. But you can’t replace the lessons that you can learn from a man with 60 years of success. Neither the experience, or knowing how to use the tools on their own will survive in today’s ecommerce environment. But figure out how to bring them together the old and the new… and you will most definitely succeed.
There’s a great discussion of successful independent retailers at http://www.retailwire.com/discussions/sngl_discussion.cfm/14122. Several people have discussed why they believe these firms are thriving.
I have added an RSS link button that should work for you. Thanks for the note,