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Wednesday, December 29, 2010

New Trend in Retail: One Thing, Done Expertly.

Heads up entrepreneurs, recall mother’s old adage: 
"Jack of all trades, master of none." 
Well here's another reason why mother dearest was right.

A re-emerging trend in retail stems from the idea that it pays to simply and expertly provide one desirable service at an affordable price.

This is similar to the category killer strategy employed successfully be retailers in the 80’s and 90’s, (e.g. Borders, OfficeMax, Petsmart). The concept worked well until technology, namely internet shopping, drastically increased competition while discounters (e.g. Target, Wal-Mart) grew larger, yet more nimble, thus cutting margins. [SOURCE]

DryBar, a salon concept where stylists only provide blow dried hair style options, is an example of the modern day category killer strategy.

It is less subject to the pit falls of the previously employed strategy simply because as a ‘personal services’ it is not affected by online retailing as significantly as a good would be.

A discount retailer can’t very well provide a good that would undercut the expert services of your favorite personal stylist. There is a human relationship there that grounds the customer/ service-provider exchange.

While tastes in hair styles may falter, the need for blow-outs will not. Ladies, I know you feel me on this one. The only limitation I see on this particular concept is the expensive build-out needed for the retail space. I would also keep in mind that the business model relies on a high volume of folks with medium to high discretionary income. Margins should be large enough to sustain a slow economy.

All in all, as we know, being vain will never go out of style, so here’s to the category killer concept and the persistence of European standards of beauty! #POW

Check out DryBar:

"No cuts, No color. Just blowouts. Only $35. Our philosophy is simple. Focus on one thing, and be the best at it. For us, that’s blowouts."

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