Why the lessons of Thomas Edison are more apt than ever
Most people know that Thomas Edison invented the electric light bulb. But perhaps it would be more accurate to say that Thomas Edison invented thousands of different electric lights bulbs until he could optimize the version most suited for success. For location-based retailers who want to thrive in one of the most competitive retail marketplaces in history, there’s actually a lot that can be learned from Edison’s story.
The clock is ticking
Here’s what Thomas Edison didn’t do. He didn’t take the first filament he had a good feeling about, mass-produce it, put it on the market, and then wait a year to look at the sales results before deciding on his next move. And yet in the world of retail, when it comes to optimizing the in-store experience, this approach happens way too often. Fleet-wide decisions are made based on the comparison of year-over-year sales numbers—which is by definition a multi-year process. Even if useful data eventually emerges, any findings run the risk of being out-of-date before they can ever be implemented.
Practice your ABTs (Always Be Testing)
If Thomas Edison had used this approach, we might all still be sitting in the dark. But instead, he experimented at a furious pace—trying over 6,000 different filaments. Some filaments worked better than others, and many didn’t work at all, but every single one taught Edison a lesson that he used to inform his next experiment.
In retail, this philosophy is at the heart of Test and Learn experimentation. Instead of the slow, scattershot process of historical trend analysis, retailers are able to run small, fast, expertly designed tests that reveal maximum insight with minimum risk. This is accomplished through A-B testing, which quite simply means the process of testing two strategies against each other to see which one performs the best. The A-test usually emerges from a hypothesis. For example, you might be testing a hypothesis that supposes: “If we replace a sale item with a non-sale item in a high traffic area, revenue will increase.” The B-test would be the control, where the sale item stays put.
The more quickly, accurately, and efficiently such tests can be deployed, compared, and analyzed, the bigger the advantage a retailer will have over its competitors.
Test and learn, done right
So why doesn’t everyone test this way? Most retailers know they need to find new ways to adapt their practices to line up with their customers’ evolving preferences. But test-and-learn experimentation requires a delicate balance to deliver dependable results. The tests have to be designed in a way that removes potential biases that could skew results. Ideally, initiatives should be tested across multiple representative treatment and control sites to get statistically valid results, but it takes a lot of know-how to make that happen in a timely fashion. And even if the test is executed perfectly, unexpected noise in the data can make the results difficult to interpret.
So instead of a consistent, reliable, and scalable process of testing and learning, many retailers are forced to rely on their best guesses to understand what it is their customers really want. That’s asking a lot of even the most intuitive retail professionals. There has to be a better way. (Spoiler: There is.)
The definition of electric
As long as we’re talking about Edison, now is a good time to remember that there’s more than one definition for “electric.” Outside of the lightbulb context, “electric” can also be used to describe something that’s thrilling, dynamic, or exciting. For example, it’s often used to praise a performance, as in “Lynn Manuel Miranda was electric in the role of Alexander Hamilton!” (He really was.)
So here’s a question: can retail be electric? Can it be a thrilling? Dynamic? Exciting? At MarketDial, we emphatically say yes. Because that’s what we’ve done for hundreds of clients across the globe, from Woolworths to The Container Store. We exist to help savvy retailers fully embrace rapid test-and-learn experimentation in a way that drives innovation and profitability every second of every day.
Online retailers like Amazon are famous for the many, many tests they run to optimize their sales. Of course, in the digital space a test can be implemented in the time it takes to copy and paste a new line of code. But the big, exciting “what-if” that we propose to our clients is this: What if a location-based retailer could have the same ability online retailers have to test-and-learn rapidly, accurately, and cost-effectively? What would happen if you could consistently ad-apt to the marketplace on the turn of a dime with rock-solid insights you can trust?
That’s what MarketDial does. A lot of it comes from our proprietary software that simplifies interpreting data into something anyone can do. But we’re not just a software company. Our hands-on experts are here to help you set up the tests, pick the best locations to provide the most meaningful results, and be incredibly accessible for any questions you have along every step of the process. You could say we’ve followed the lead of our retail clients by becoming experts in the personal touch required to deliver an exquisite customer service experience.
It’s not easy, but it sure is fun. One of our favorite things is seeing the infectious energy that spreads through our clients when they realize that they have more control over the future of their business than they ever thought. Every aspect of their retail experience becomes a chance to try new things in a risk-free environment, whether it’s product arrangement, marketing, pricing, loyalty programs, or employee training.
Suddenly, they start to see brick and mortar the way we see it—not as some kind of monolith frozen in place, but as building blocks that can be constantly reconfigured into dynamic new shapes.
An apt comparison would be that it’s a lot like seeing a light bulb go on. And we think that would make Thomas Edison proud.