| Written by Debbie Hauss |
| “I think this year is a singularity,” says Paula Rosenblum from RSR Research. “We are living in a shell-shocked society at the moment, and I can’t imagine this will continue.” Consumers did flock to the stores on Black Friday 2008, but mostly to deep discounters and at those stores they were looking for unusually large markdowns. Retailers know that consumers, particularly this year, won’t blink an eye at a 20%, 25% or even 50% discounts in many cases. Those out shopping are looking for 70% off and higher – and in many cases the retailers responded…but at what cost? The Deep Discount Debate Many retailers have felt the pressure to offer consumers the deepest discounts this year, even if it is historically out of character for their companies. “It is the year of the deal,” says Brad Wolansky, vice president of global e-commerce for The Orvis Company. “Even merchants who traditionally aren’t promotional (such as Orvis) must pay to play this year. Serving up the ‘same old stuff’ doesn’t work, particularly on the web where customers can see the difference.” But industry experts have mixed opinions on the subject: “Deep discounts don’t boost your brand, they just destroy your margin,” says Nikki Baird from RSR Research. Greg Buzek, president of IHL Services, has a different take: “Retailers that are not willing to heavily discount during this season are going to see dramatic drops in same store sales. Abercrombie discounted less than others and saw their overall sales for November drop 28%. Those that discounted might not have increased sales, but they were able to weather the storm a bit better.” “To further exacerbate the problem, it has also been challenging for retailers to compete against the prices of competitors who have filed for bankruptcy and have already publicly announced their store closures,” adds Janet Sherlock, research director at AMR Research. “While top-level revenue figures were adequate during the 2008 Thanksgiving weekend, profit contribution was likely poor for many retailers. Unfortunately, we then train the consumer to expect excessively low prices. Next year, there will likely be fewer retailers.” Is Cyber Monday Effective? RSR’s Rosenblum says a resounding “No!” She contends that if the industry jumped off the Cyber Monday bandwagon retailers would gain more total gross margin dollars. “Cyber Monday is a creation of the industry (or let’s say, industry trade groups), not the customer. The core assumption is that people shop while they are at work because they have bigger and better computers, and that’s just wrong, or at least dated. If retailers stopped running those silly promotions on that day…they would be primed to provide a better customer experience.” Nevertheless, Cyber Monday exists and will likely continue to exist. To make it a successful event, retailers must first ensure that their web sites will work effectively throughout the entire Thanksgiving weekend, then they should focus on effective cross-channel retailing as an everyday practice. “Retailers have totally underestimated the amount of online traffic on Black Friday,” says Buzek. “Sears’ site went down and Walmart attempted a major change the week of Black Friday. That’s just asking for trouble.” That said, Buzek suggests that retailers bring Black Friday and Cyber Monday together for consumers to offer a better customer experience through effective cross-channel retailing. “The best thing would be to allow consumers to gain Black Friday pricing or Cyber Monday pricing in both channels. Particularly for Cyber Monday, the offers that are online should also be available in the stores.” But Baird sees challenges with trying to coordinate across channels during this hyper busy weekend. “There is little cross-channel opportunity because the challenge of managing high-demand items prevents you from making online or in-store promises.” Make Loyalty Members Feel Special Whether or not deep discounting is helping retailers this year or any year for that matter, retailers still must focus on garnering sales from their best customers not only during the holidays but all year long and from one year to the next. “Retailers really do very little to make their loyalty shoppers feel special,” notes Baird. “How about a special gold member lounge complete with foot massage and hot chocolate? Or loyalty members only from 4-6am and 9-10pm?” Buzek agrees. “I think most retailers are missing the boat on focusing on low margin sales only to drive traffic for (Black Friday) rather than building a longer term relationship that allows for outreach and ‘special days’ throughout the year. Retailers like Borders and Best Buy get it with their programs. I’m not sure of too many others that are taking advantage.” Other Innovative Alternatives to Deep Discounting Discounting on Black Friday, Cyber Monday or any other day of the year is just not an option for some retailers. Abercrombie chose to forgo discounts to maintain its brand image. Cloudveil, an outdoor apparel wholesaler and retailer, has responded similarly. “We can’t discount on our site or at our store because our products are sold through many other wholesalers and they would not appreciate being undersold by us,” says Jeff Wogoman, director of marketing at Cloudveil. Instead, Wogoman is looking at more innovative ways to sell Cloudveil products. “We are looking at developing more video content for our website and we are trying to crack the social media nut a bit more.” Wogoman cites Nike as one retailer that has “hit the ball out of the park” with social media. “Giving a forum to runners to download information and share with others – it was genius that they pulled it off.” Is There a Utopian Thanksgiving Weekend for Retailers? It’s called Black Friday because it’s the weekend when most retailers traditionally move into the “Black” and it is likely to continue beyond 2008 and 2009. But the Internet, social media and mobile retailing are forcing retailers to be more reactive on the spot. “You need to evolve daily and serve the promotions and products and prices that customers are looking for,” says Orvis’ Wolansky. AMR’s Sherlock offers up a few tips for retailers going into 2009. “Next year there will likely be fewer retailers and the retailers that remain should have learned to: 1. Buy as lean as possibleThose tips plus a healthy economic recovery could bode well for retailers in 2009 and beyond. |
Thursday, December 18, 2008
Mid-Season Report Card For The Holiday Season Shows Missed Opportunities
Thursday, December 11, 2008
iPhone Apps Represent New Window Of Opportunity For Retail Marketers
By John Gaffney
After all the same store sales plunges, consumer spending pullbacks, profit nosedives and pricing collapses, one of the few the most positive image of 2008 can be found in a swirling picture of snow set against an iPhone screen and a big red bullseye. With Target, Amazon, and The Gap leading the way, the past two weeks has definitely put mobile applications on the retail agenda to stay.
“It’s a very similar market to ten years ago when retailers started flocking to online advertising,” says Chris Negron, sales executive for online music service Pandora. “Now everyone wants to be mobile. I would say 50 percent of our online clients are looking to develop a mobile application and a good number of those are retailers.”
The importance of this initial flurry is twofold. First, it has taken mobile phone applications and advertising from the planning stage to reality in a short period of time. Second, it has established the platform as a legitimate touch point for retail consumers. Pandora has been officially listed by Apple as one of the top ten applications (out of 10,000) in the iTunes app store. It was one of the first applications developed for the device, and its service carries mobile on-screen ads.
Negron is not at liberty to discuss the retailers initially involved in his service, but he says there are major companies other than Target, Gap and Amazon. He has seen the retail interest level developing into the more substantial breakouts from the three retailers who bowed proprietary applications over the past two weeks. Here’s what the three are aiming at with their applications:
• Target: Developed by San Francisco-based AKQA, the Target app makes use of the “accelerometer.” Shake the iPhone and the gravity and vibration cause the screen to change. While other accelerometer applications are used to simulate beer chugging,in Target’s case it is a snow globe that settles around a product and then the logo. “Good mobile phone applications are good branding applications,” says Kevin Barenblat, CEO of Context Optional, which has developed iPhone applications for several brands. “That’s what Target does.”
• Amazon: Barenblat says Amazon’s entry defines the utility that must be associated with the brand magic for mobile apps. Amazon’s application offers access to other retailers, such as Target and Macy's, but its features, which include "one-click" shopping, are focused on Amazon. It also includes Amazon Remembers, an experimental feature that uses the iPhone's camera to help create visual lists of products you want. Take a photo, and the iPhone app uploads the image to Amazon.com; the service then tries to match products in the same category.
• Gap: Barenblat also urges retailers to make sure their mobile apps are viral. The Gap fills this requirement. Its first mobile app features music videos with Christmas carols being sung by popular artists. The videos can be sent to friends via email. Another allows users to mix and match clothing on male or female models, and then tap to buy the items.
The most important “to do” for retailers planning mobile app development is long-term planning. Negron counsels retailers that are either planning ad campaigns on apps like Pandora or developing proprietary solutions to think beyond the initial buzz. The iPhone for example, started with just 300 apps in June. By the fourth quarter of next year it could easily have 20,000 different applications ranging from the novelties like beer chugging to serious retail e-commerce channels.
“Think through the series of apps as you would a media plan,” he says. “They are changeable and they will all need to have their own promotion plan to achieve scale. Different applications will fit different times of the year.”
Most analysts believe e-commerce applications will be the rule rather than the exception for cross-channel retailing by spring. “Think beyond the first iteration,” Barenblat says. “And don’t settle for cool factor alone. Think in terms of ROI.”
Thursday, December 4, 2008
Warning Signs Within Black Friday, Cyber Monday Spikes, As Retailers Go “All-In” Early With Holiday Deals
At first glance the results from the recent Black Friday and Cyber Monday sales gave the retail community some hope that consumers might be willing to open up their wallets again. Shoppers upped spending on Black Friday by 7.2% over last year, with the NRF’s 2008 Black Friday Weekend survey conducted by Big Research, estimating total Black Friday spending at $41 billion. Online sales for Cyber Monday also jumped 15% from a year ago, according to data from comScore, Inc.
However, a closer look at how those increases were achieved raises some caution flags. Sales spikes from the key Black Friday and Cyber Monday deals may have been more of a mirage that distorted the real slump still going on in retail. The November sales results reported this week continued to show a sharp downturn for almost every company not based in Bentonville. Target’s November sales dropped 10% and off-price leader TJX declined 12%. The November MasterCard Spending Pulse predicted a decline of more than 20% across several categories.
What is even more troubling than the continued sales slump is the potential long-term impact that the desperate deep discounting and “promote-at-all costs” approach retailers have taken to try and paddle some new life into the holiday season. The huge traffic spikes merchants have come to count on Black Friday and Cyber Monday could easily be watered down in coming years as retailers offered head starts and extensions on the holidays this year. Some examples:
Given the meltdown of the economy and the related impact it has had on consumer spending it is understandable that retailers need to be extremely aggressive during the remaining weeks of the holiday season. However, it is also important that promotions be based on real value of special buys and/or hot merchandise, rather than desperation. As the auto industry is demonstrating in its testimony in Washington this week, once you have played all your cards with the consumer, there is no rebate offer or discount promotion you can offer to trump up demand. Ultimately, what happens is consumer trust is lost and shoppers become trained that a better deal is always coming next week.
However, a closer look at how those increases were achieved raises some caution flags. Sales spikes from the key Black Friday and Cyber Monday deals may have been more of a mirage that distorted the real slump still going on in retail. The November sales results reported this week continued to show a sharp downturn for almost every company not based in Bentonville. Target’s November sales dropped 10% and off-price leader TJX declined 12%. The November MasterCard Spending Pulse predicted a decline of more than 20% across several categories.
What is even more troubling than the continued sales slump is the potential long-term impact that the desperate deep discounting and “promote-at-all costs” approach retailers have taken to try and paddle some new life into the holiday season. The huge traffic spikes merchants have come to count on Black Friday and Cyber Monday could easily be watered down in coming years as retailers offered head starts and extensions on the holidays this year. Some examples:
- Borders got a head start on Black Friday with an email campaign on Tuesday, Nov. 25, extending its Rewards members a Pre-Black Friday Savings Pass for the Wednesday prior to Black Friday, extending 50% off certain books and Buy 1 Get 1 offers as part of a special in-store promotion.
- On the Sunday prior to Cyber Monday, Circuit City sent out an email with the headline, “Our Cyber Monday Sale starts now--we couldn't wait until tomorrow!” On the flipside of starting early, Circuit City also dragged Black Friday for out for an “encore event,” with an email campaign hitting on the Thursday after Black Friday titled, “Back by popular demand: Black Friday deals, better than ever!”
Given the meltdown of the economy and the related impact it has had on consumer spending it is understandable that retailers need to be extremely aggressive during the remaining weeks of the holiday season. However, it is also important that promotions be based on real value of special buys and/or hot merchandise, rather than desperation. As the auto industry is demonstrating in its testimony in Washington this week, once you have played all your cards with the consumer, there is no rebate offer or discount promotion you can offer to trump up demand. Ultimately, what happens is consumer trust is lost and shoppers become trained that a better deal is always coming next week.
Thursday, November 20, 2008
Leading Retailers Relying On Analytics Tools To Respond To Shifts In Holiday Demand
By John Gaffney
The dynamics of the current retail landscape are fast and furious, with the next few weeks sure to turn up the heat even more as retailers look to make up for lost sales after a slow start to the holiday shopping season. Many experts are predicting customer data analytics, and the optimization processes that result from it, will play an essential role as retailers try to maintain their agility.
Leading online jewelry site Ice.com, which has been in business since 1999, is banking on data to help it get through a “tough” year,” according to Pinny Gniwisch, Vice President of Marketing. Next week the site will add a proprietary customer review application. “The data we collect helps us get to know our customers and helps us interact with them,” he says. “We used to manually search through shopping carts and wish lists to get customer data, and while that can work, it’s not automated. Now it’s automated. All the successful retailers that I track are using data to cut acquisitions costs and drive sales.”
Industry insiders predict data analytics will give leading edge retailers a competitive advantage on many fronts this holiday season. “Very simply data makes retailing more customer-centric,” says Alexi Sarnevitz, senior director of retail strategy for SAS. “That’s important in any environment, but it is essential in a tough economy.”
From a pricing perspective, Sarnevitz believes the stronger retailers will be able to quickly evaluate Thanksgiving weekend sales, and then make adjustments within days. From a marketing perspective, he expects that campaigns will be optimized or pulled based on the data generated by them. Many retailers have begun this process already and are looking at agility as a key to surviving this holiday season.
While SAS has been working closely with leading retailers on predictive modeling and predictive analytics solutions, Sarnevitz points out that past behavior counts too. Retailers who rely closely mine their data will be in better shape from an inventory perspective because their stock levels have been driven by data, not supplier relationships or past year comparisons. An example of how inventory optimization can be seen in recently published case study on Waitrose, a leading UK supermarket chain. Using SAS solutions to achieve accurate demand forecasting, Waitrose was able to realize more efficient stock ordering, delivery and replenishments. Waitrose also reduced its stock holding by 8%, its waste by 4% and was able to improve customer satisfaction significantly by ensuring product availability.
“Data needs to be managed end to end,” says Thomas Redman, author of Data Driven. “Retailers have to put good data in the system, and they will be rewarded with the ability to understand their customers. Those customers will still be here next quarter. All the good things that data brings to a business will be here next quarter too.”
The dynamics of the current retail landscape are fast and furious, with the next few weeks sure to turn up the heat even more as retailers look to make up for lost sales after a slow start to the holiday shopping season. Many experts are predicting customer data analytics, and the optimization processes that result from it, will play an essential role as retailers try to maintain their agility.
Leading online jewelry site Ice.com, which has been in business since 1999, is banking on data to help it get through a “tough” year,” according to Pinny Gniwisch, Vice President of Marketing. Next week the site will add a proprietary customer review application. “The data we collect helps us get to know our customers and helps us interact with them,” he says. “We used to manually search through shopping carts and wish lists to get customer data, and while that can work, it’s not automated. Now it’s automated. All the successful retailers that I track are using data to cut acquisitions costs and drive sales.”Industry insiders predict data analytics will give leading edge retailers a competitive advantage on many fronts this holiday season. “Very simply data makes retailing more customer-centric,” says Alexi Sarnevitz, senior director of retail strategy for SAS. “That’s important in any environment, but it is essential in a tough economy.”
From a pricing perspective, Sarnevitz believes the stronger retailers will be able to quickly evaluate Thanksgiving weekend sales, and then make adjustments within days. From a marketing perspective, he expects that campaigns will be optimized or pulled based on the data generated by them. Many retailers have begun this process already and are looking at agility as a key to surviving this holiday season.
While SAS has been working closely with leading retailers on predictive modeling and predictive analytics solutions, Sarnevitz points out that past behavior counts too. Retailers who rely closely mine their data will be in better shape from an inventory perspective because their stock levels have been driven by data, not supplier relationships or past year comparisons. An example of how inventory optimization can be seen in recently published case study on Waitrose, a leading UK supermarket chain. Using SAS solutions to achieve accurate demand forecasting, Waitrose was able to realize more efficient stock ordering, delivery and replenishments. Waitrose also reduced its stock holding by 8%, its waste by 4% and was able to improve customer satisfaction significantly by ensuring product availability.
“Data needs to be managed end to end,” says Thomas Redman, author of Data Driven. “Retailers have to put good data in the system, and they will be rewarded with the ability to understand their customers. Those customers will still be here next quarter. All the good things that data brings to a business will be here next quarter too.”
Thursday, November 13, 2008
Mobile Couponing Moves Into New Markets, GameStop Plays With New Phone Offers
After making its mark initially with supermarkets and consumer product brands, mobile couponing is extending its reach into other retail verticals. Matching its target demographic of young, tech savvy consumers, GameStop recently signed with Cellfire to use its service to distribute mobile coupons which are redeemable at its more than 4,200 stores in U.S. and Puerto Rico.
GameStop, the world’s largest video game and entertainment software retailer, is partnering with Cellfire to deliver a unique mobile experience that will add a dimension of fun and convenience to the retail experience for its customers. The program allows customers to simply show the coupon displayed on their cell phone at the register to receive a discount.
“As the mobile Web emerges as a viable marketing channel, reaching our customers through their cell phones is a natural progression,” said John Brittell, VP of E-commerce and Direct Marketing of GameStop.
Gamers can take advantage of these exclusive deals at GameStop by subscribing to the Cellfire mobile coupon service at http://www.cellfire.com or they can text keywords to have the respective offer clipped to their Cellfire account where it can be accessed on-demand. The promotional offers are targeting customers who are trading in or exchanging games, as well as a discount toward the purchase of a used game.
Mobile couponing is also catching on with quick serve restaurants as Arby’s announced plans back in August to partner with San Jose, CA-based Cellfire to use its service to distribute mobile coupons redeemable at 250 locations throughout the country.
The Arby’s offers included coupons for a Buy One, Get One free sandwich, discounts on premium drinks and free sandwich offers with the purchase of fry and drink. “Cellfire’s mobile coupons help us deliver value right into our customers’ hands when they are on-the-go, hungry for fresh, great tasting quality food and looking for a deal,” said Cyndi Richardson, Vice President, Company Marketing, Arby’s Restaurant Group, Inc.
Consumers access the free Cellfire mobile coupon service through a mobile application that resides on their cell phone or through a mobile Web browser. While consumers can use text messages to initiate Cellfire registration and save offers for future use, Cellfire is not a text message coupon service.
GameStop, the world’s largest video game and entertainment software retailer, is partnering with Cellfire to deliver a unique mobile experience that will add a dimension of fun and convenience to the retail experience for its customers. The program allows customers to simply show the coupon displayed on their cell phone at the register to receive a discount.“As the mobile Web emerges as a viable marketing channel, reaching our customers through their cell phones is a natural progression,” said John Brittell, VP of E-commerce and Direct Marketing of GameStop.
Gamers can take advantage of these exclusive deals at GameStop by subscribing to the Cellfire mobile coupon service at http://www.cellfire.com or they can text keywords to have the respective offer clipped to their Cellfire account where it can be accessed on-demand. The promotional offers are targeting customers who are trading in or exchanging games, as well as a discount toward the purchase of a used game.
Mobile couponing is also catching on with quick serve restaurants as Arby’s announced plans back in August to partner with San Jose, CA-based Cellfire to use its service to distribute mobile coupons redeemable at 250 locations throughout the country.
The Arby’s offers included coupons for a Buy One, Get One free sandwich, discounts on premium drinks and free sandwich offers with the purchase of fry and drink. “Cellfire’s mobile coupons help us deliver value right into our customers’ hands when they are on-the-go, hungry for fresh, great tasting quality food and looking for a deal,” said Cyndi Richardson, Vice President, Company Marketing, Arby’s Restaurant Group, Inc.
Consumers access the free Cellfire mobile coupon service through a mobile application that resides on their cell phone or through a mobile Web browser. While consumers can use text messages to initiate Cellfire registration and save offers for future use, Cellfire is not a text message coupon service.
Thursday, October 30, 2008
RetailWire: P&G Tests Online Sales to Consumers
Editor’s Note: This article is an excerpt from one of RetailWire’s recent online discussions. Each business morning on RetailWire.com, retail industry executives get plugged in to the latest news and issues with key insights from a “BrainTrust” of retail industry experts.
By: George Anderson
After focusing on cross-channel promotions and online info-sites for years, Procter & Gamble is working with a third-party operated website, theEssentials.com, to sell its brands directly to consumers, thereby bypassing traditional retail outlets.
TheEssentials.com, which only sells P&G products, is part of a larger movement by consumer packaged goods (CPG) brands to test direct sales to consumers. P&G rivals L'Oreal and Estee Lauder, for example, have operated websites that sell beauty brands to consumers.
While it supports the operation of theEssentials.com, P&G spokesperson Paul Fox told The Financial Times, "We treat them like any other retailer as they buy product directly from us."
P&G's direct sales test is still somewhat uncommon among CPG manufacturers but is something that companies in apparel, electronics and other categories have used with varying degrees of success. Some retail experts were underwhelmed by P&G’s move and skeptical of its success.
While an interesting experiment, one has to ask why consumers would feel the need to buy these products directly from Procter & Gamble, when most of the products are available at either Drugstore.com, Amazon.com, or other online retailers. While it is a great way for P&G to gain insight from their consumers, they will have a difficult time providing a compelling reason as to why people should shop on this site. Unless on the other hand, they start to offer products or variations of products that are not available from other online retailers,” said Joel Warady, principal of the Joel Warady Group. “Let's not forget that P&G has sold directly to consumers before through their Reflect.com site. And that ended up in a failure, although it was a completely different model. Let's see where P&G takes this, and how they can make this work.”
“It's highly unlikely that CPG vendors will make significant sales directly to consumers over an Internet channel. For the bulk of P&G's products, it is far more convenient for consumers to buy them from a retailer that offers a broad assortment of products that can be purchased on one shopping trip. theEssential.com appears to be focusing on P&G's more expensive and complex products, such as OralB toothbrushes, Braun coffee makers, and Crest Whitestrips, not toothpaste and detergents,” said University of Florida professor Barton Weitz. “For these more expensive products, consumers might purchase them from an Internet channel with theEssentials.com being one of many Internet retailers offering the products. theEssentials.com does provide parts for P&G consumers that might be hard to buy through traditional supermarket channels. By offering these parts, theEssentials.com can provide a service to P&G customers--a service not offered by its retailers.”
By: George Anderson
After focusing on cross-channel promotions and online info-sites for years, Procter & Gamble is working with a third-party operated website, theEssentials.com, to sell its brands directly to consumers, thereby bypassing traditional retail outlets.
TheEssentials.com, which only sells P&G products, is part of a larger movement by consumer packaged goods (CPG) brands to test direct sales to consumers. P&G rivals L'Oreal and Estee Lauder, for example, have operated websites that sell beauty brands to consumers.
While it supports the operation of theEssentials.com, P&G spokesperson Paul Fox told The Financial Times, "We treat them like any other retailer as they buy product directly from us."
P&G's direct sales test is still somewhat uncommon among CPG manufacturers but is something that companies in apparel, electronics and other categories have used with varying degrees of success. Some retail experts were underwhelmed by P&G’s move and skeptical of its success.
While an interesting experiment, one has to ask why consumers would feel the need to buy these products directly from Procter & Gamble, when most of the products are available at either Drugstore.com, Amazon.com, or other online retailers. While it is a great way for P&G to gain insight from their consumers, they will have a difficult time providing a compelling reason as to why people should shop on this site. Unless on the other hand, they start to offer products or variations of products that are not available from other online retailers,” said Joel Warady, principal of the Joel Warady Group. “Let's not forget that P&G has sold directly to consumers before through their Reflect.com site. And that ended up in a failure, although it was a completely different model. Let's see where P&G takes this, and how they can make this work.”
“It's highly unlikely that CPG vendors will make significant sales directly to consumers over an Internet channel. For the bulk of P&G's products, it is far more convenient for consumers to buy them from a retailer that offers a broad assortment of products that can be purchased on one shopping trip. theEssential.com appears to be focusing on P&G's more expensive and complex products, such as OralB toothbrushes, Braun coffee makers, and Crest Whitestrips, not toothpaste and detergents,” said University of Florida professor Barton Weitz. “For these more expensive products, consumers might purchase them from an Internet channel with theEssentials.com being one of many Internet retailers offering the products. theEssentials.com does provide parts for P&G consumers that might be hard to buy through traditional supermarket channels. By offering these parts, theEssentials.com can provide a service to P&G customers--a service not offered by its retailers.”
Tuesday, October 28, 2008
Q&A With OfficeMax VP Bob Thacker On Cause Marketing, Holiday Promos
OfficeMax has proven itself to be one of the most innovative marketers in the retail space. It recently announced it will reprise its highly trafficked Elf Yourself campaign this holiday season, after driving 193 million website visitors last year to upload a photo so they could see what they looked like as an OfficeMax elf. Following up on the Elf Yourself campaign, now OfficeMax is adding a layer of cause marketing.
The “A Day Made Better” cause marketing initiative, in which OfficeMax and education advocate Adopt-a-Classroom surprised over 1,000 teachers with school supplies across the US and Mexico, is one of the activities that “gives a company a soul,” according to OfficeMax VP of Marketing Bob Thacker. Retail TouchPoints had the opportunity to talk with Thacker and learn the fundamentals of the recent “A Day Made Better” cause marketing initiative. The former VP of marketing for Target Corp. and head of creative for Sears, Thacker is one of the more experienced and respected voices in retail marketing. In addition to detailing the Day Made Better campaign, Thacker also touched on the company’s holiday plans, and how the elves are taking over.
Retail TouchPoints: Can you speak to how and why cause marketing is becoming a more important element of a retailers’ marketing mix?
Bob Thacker: I’ve been involved in cause marketing for over 20 years. I actually helped create cause marketing when I was at Target and I felt then, and I feel even stronger now, that it is what gives a company a soul. People today are looking for a deeper relationship with companies they do business with. Many people today feel that they don’t want to do business with what I call a “carpet bagger,” a company that just comes into the market and just takes money out and doesn’t put anything back, or make the experience richer or more rewarding. People really expect companies to have a soul, and cause marketing is one of the ways that companies can do that.
RTP: How, if at all, does the economy factor into cause marketing?
Thacker: For [OfficeMax], it really wasn’t a factor at all. Other people have asked, ‘well, gee, with what the economy’s doing your sales are probably not as great as you’d want them to be. Have you thought about canceling that?’ My response is: would I cancel Christmas? They are two different things. Cause marketing can and does lead to increased sales, but that really isn’t why it should be on your marketing initiative. It has to do with who you are as a company. Do you put your soul away because sales are down? I don’t think so.
RTP: You had mentioned how consumers are looking for a deeper relationship with the companies they shop. How does the customer psychology and perception of cause marketing factor into it, and how is “A Day Made Better” really nurturing those thoughts?
BT: The Cone Cause Evolution study 2008, released this month, revealed that education was the leading issue among Americans. 79% of consumers said if the price and quality were similar they would switch to a brand associated with a good cause.
RTP: The “A Day Made Better” initiative was launched in 2007. Was there a difference in last year’s initiative to that of 2008?
BT: Yes.To go back and recap why we did it in the first place, the whole idea of teacher’s funding their own classrooms is a crime. And teachers spend $4 billion a year of their own money to pay their way, and on average, a teacher makes about $30,000 a year. Our whole attempt is to make this a national cause. We can’t fix it ourselves but we can certainly bring attention to it, do what we can and make the public aware of what a crime is being committed. In 2007, we did 1,000 classrooms all over the country. In 2008, we increased it by 1/3 to 1,300 classrooms and we involved Mexico. We also brought celebrity and key opinion leader attention to it. We had some very prominent people supporting this initiative, and in some cases, going out and surprising teachers. It grew in a really great way to become something bigger, more dynamic, than we had expected it to be.
RTP: Was there a criteria for the teachers selected who received supplies on “A Day Made Better?”
BT: Yes. They were all selected by our non-profit partner, Adopt-a-Classroom. We were not involved in the individual school selection. The teachers all needed to be in school that had a high level of need. A majority of the children in the schools are on free lunch programs, come from lower income families and in schools that have generally a greater need than, say, a well-endowed private school or a school that has some legacy or a huge foundation behind it. These are poor schools, underpaid teachers with kids who need it the most.
RTP: Does OfficeMax plan to continue the “A Day Made Better” effort in the future?
BT: Oh yeah, it’s deeply engrained in our culture and it’s’ really fun to walk around and hear people talk about ‘okay, next year on a day…’ It’s come down to a day and it’s referred to like it’s our day. I’ve been involved in 50 or so events like this in my career, and this has been the most emotionally effective and has done the most to raise the whole self esteem of the company… Our primary focus is on helping teachers and schools.
RTP: Does the company plan to bring back the “Elf Yourself” promotion for the holidays?
BT: He’s back! He’s going to be bigger than ever before. We’re just getting ready to launch him after Halloween. He’s going to be available in four different varieties of music and different dances. It has taken on a life of its own. It’s set a bar that nobody I know has been able to match, including us. The thing that’s different this year is that people will actually be able to make things out of the elf. You can make Christmas cards and different novelty items ad ornaments, so the elf can be preserved permanently, whereas before he used to be limited to the viral space. He will actually be available in product form so that’s going to be fun! It has become the viral equivalent of Frosty or Rudolph, the classic icons of the past. The elf is today’s version of that. Over 30% of the people who created elves said it made them feel better about OfficeMax.
The “A Day Made Better” cause marketing initiative, in which OfficeMax and education advocate Adopt-a-Classroom surprised over 1,000 teachers with school supplies across the US and Mexico, is one of the activities that “gives a company a soul,” according to OfficeMax VP of Marketing Bob Thacker. Retail TouchPoints had the opportunity to talk with Thacker and learn the fundamentals of the recent “A Day Made Better” cause marketing initiative. The former VP of marketing for Target Corp. and head of creative for Sears, Thacker is one of the more experienced and respected voices in retail marketing. In addition to detailing the Day Made Better campaign, Thacker also touched on the company’s holiday plans, and how the elves are taking over.Retail TouchPoints: Can you speak to how and why cause marketing is becoming a more important element of a retailers’ marketing mix?
Bob Thacker: I’ve been involved in cause marketing for over 20 years. I actually helped create cause marketing when I was at Target and I felt then, and I feel even stronger now, that it is what gives a company a soul. People today are looking for a deeper relationship with companies they do business with. Many people today feel that they don’t want to do business with what I call a “carpet bagger,” a company that just comes into the market and just takes money out and doesn’t put anything back, or make the experience richer or more rewarding. People really expect companies to have a soul, and cause marketing is one of the ways that companies can do that.
RTP: How, if at all, does the economy factor into cause marketing?
Thacker: For [OfficeMax], it really wasn’t a factor at all. Other people have asked, ‘well, gee, with what the economy’s doing your sales are probably not as great as you’d want them to be. Have you thought about canceling that?’ My response is: would I cancel Christmas? They are two different things. Cause marketing can and does lead to increased sales, but that really isn’t why it should be on your marketing initiative. It has to do with who you are as a company. Do you put your soul away because sales are down? I don’t think so.
RTP: You had mentioned how consumers are looking for a deeper relationship with the companies they shop. How does the customer psychology and perception of cause marketing factor into it, and how is “A Day Made Better” really nurturing those thoughts?
BT: The Cone Cause Evolution study 2008, released this month, revealed that education was the leading issue among Americans. 79% of consumers said if the price and quality were similar they would switch to a brand associated with a good cause.
RTP: The “A Day Made Better” initiative was launched in 2007. Was there a difference in last year’s initiative to that of 2008?
BT: Yes.To go back and recap why we did it in the first place, the whole idea of teacher’s funding their own classrooms is a crime. And teachers spend $4 billion a year of their own money to pay their way, and on average, a teacher makes about $30,000 a year. Our whole attempt is to make this a national cause. We can’t fix it ourselves but we can certainly bring attention to it, do what we can and make the public aware of what a crime is being committed. In 2007, we did 1,000 classrooms all over the country. In 2008, we increased it by 1/3 to 1,300 classrooms and we involved Mexico. We also brought celebrity and key opinion leader attention to it. We had some very prominent people supporting this initiative, and in some cases, going out and surprising teachers. It grew in a really great way to become something bigger, more dynamic, than we had expected it to be.
RTP: Was there a criteria for the teachers selected who received supplies on “A Day Made Better?”BT: Yes. They were all selected by our non-profit partner, Adopt-a-Classroom. We were not involved in the individual school selection. The teachers all needed to be in school that had a high level of need. A majority of the children in the schools are on free lunch programs, come from lower income families and in schools that have generally a greater need than, say, a well-endowed private school or a school that has some legacy or a huge foundation behind it. These are poor schools, underpaid teachers with kids who need it the most.
RTP: Does OfficeMax plan to continue the “A Day Made Better” effort in the future?
BT: Oh yeah, it’s deeply engrained in our culture and it’s’ really fun to walk around and hear people talk about ‘okay, next year on a day…’ It’s come down to a day and it’s referred to like it’s our day. I’ve been involved in 50 or so events like this in my career, and this has been the most emotionally effective and has done the most to raise the whole self esteem of the company… Our primary focus is on helping teachers and schools.
RTP: Does the company plan to bring back the “Elf Yourself” promotion for the holidays?
BT: He’s back! He’s going to be bigger than ever before. We’re just getting ready to launch him after Halloween. He’s going to be available in four different varieties of music and different dances. It has taken on a life of its own. It’s set a bar that nobody I know has been able to match, including us. The thing that’s different this year is that people will actually be able to make things out of the elf. You can make Christmas cards and different novelty items ad ornaments, so the elf can be preserved permanently, whereas before he used to be limited to the viral space. He will actually be available in product form so that’s going to be fun! It has become the viral equivalent of Frosty or Rudolph, the classic icons of the past. The elf is today’s version of that. Over 30% of the people who created elves said it made them feel better about OfficeMax.
Thursday, October 2, 2008
Retailers Need to Realign Wall Street Reporting Practices with Cross-Channel Reality
Written by John Gaffney
With Wall Street analyst firms and the investors they supposedly service back on their heels it is an excellent time for retailers to fix something that has been broken for some time. After years of toiling under the irrelevant judgment of comp store sales, retailers can change the game to the rules of cross-channel engagement.
Several retail and technology vendors have pointed this out during the past few weeks of economic turmoil. Retail stocks have largely outperformed the plunging market, and will most likely come out stronger from this crucible of repositioned credit and unreasonable growth expectations. But instead of looking at Wall Street wants, which is the simplicity of short-term measurements of comp store sales, it’s time for retailers to refocus investors on the reality of the cross-channel world. Circuit City provides the best and most recent example of how not to do this. Its comp store sales were way down last quarter, and its prospects for opening new ones were dim. So they bailed. They told Wall Street analysts “we’re not reporting anything anymore” and they filled financial press releases with platitudes about serving the customer and focusing on its core business.
Circuit City can do better and all retailers can do better. Wall Street judgments are reality. But so is the cross-channel retailing environment. Comp store sales were relevant when comp store sales were the only measurement available of retail performance. Retailers have a richer data palette to work with. We see five areas that should become an essential part of all financial reporting and as a consequence provide a more accurate financial picture of the current as well as future state of any retailer.
Channel growth: Comp store sales should be part of a three-pronged reporting approach. Retailers should call out their quarterly growth online, in-store, and direct channels. Obviously this will be different depending on the business model. Amazon and Overstock would not report in-store sales. But there is no better measure of retail performance than the ability to keep pace with the consumer’s desire to work different channels for purchase, information, and returns. Retailers should be judged on how they grow in all relevant areas. Retail executives don’t manage toward an obsessive focus on comp store sales, they manage across channels. So why are they still judged so simplistically?
Conversion Rates: Online conversion rates hover around three percent. In-store conversion rates are too inconsistent to measure, but could be measured if retailers focused doing so. Conversion rates are a true measure of how attractive pricing, promotion, and service are working. Example: The 80 percent increase in online conversion rates measured recently at Urban Outfitters should say more about the strategy and practices of that operation than comp store sales. And when compared on a quarterly basis, analysts will know more about “what works” instead of the short term and potentially misleading metric of “what sold.”
Customer Satisfaction: Customer experience, especially in a cross-channel world, can be an excellent predictor for retailers. Circuit City, for example, is investing a lot of money in sales associate technology as well as new store formats. If they reported the results of these efforts in terms of customer experience by settling on a consistent metric such as NetPromoter, it would say more about its future value than its sales of expensive electronics in an economy as tight as this one.
Traffic: Not just foot traffic. In the cross-channel world an increase in web site traffic can predict increased product research and an increased intent to purchase. A decline in web site traffic means the online component of a retailer operation has lost momentum. Once again, all these indicators can and should be judged holistically.
Customer Engagement: Analysts should know open and click through rates of marketing campaigns. They should know metrics about call center activity. They should know loyalty program registrations and points redeemed. They should know email response rates. All these metrics show the willingness customers have to take a relationship beyond simple purchases. Customer engagement is tricky to measure as an aggregate behavior. But it is a potentially powerful indicator of long-term retail financial fitness.
The Wall Street focus on comp store sales will not change in a day. And analysts will continue to weight those results heavily. But at the very least retailers can begin to prepare more relevant reporting information, and begin to work on a metric and an attitude that needs to be dragged into the cross-channel world.
With Wall Street analyst firms and the investors they supposedly service back on their heels it is an excellent time for retailers to fix something that has been broken for some time. After years of toiling under the irrelevant judgment of comp store sales, retailers can change the game to the rules of cross-channel engagement.
Several retail and technology vendors have pointed this out during the past few weeks of economic turmoil. Retail stocks have largely outperformed the plunging market, and will most likely come out stronger from this crucible of repositioned credit and unreasonable growth expectations. But instead of looking at Wall Street wants, which is the simplicity of short-term measurements of comp store sales, it’s time for retailers to refocus investors on the reality of the cross-channel world. Circuit City provides the best and most recent example of how not to do this. Its comp store sales were way down last quarter, and its prospects for opening new ones were dim. So they bailed. They told Wall Street analysts “we’re not reporting anything anymore” and they filled financial press releases with platitudes about serving the customer and focusing on its core business.
Circuit City can do better and all retailers can do better. Wall Street judgments are reality. But so is the cross-channel retailing environment. Comp store sales were relevant when comp store sales were the only measurement available of retail performance. Retailers have a richer data palette to work with. We see five areas that should become an essential part of all financial reporting and as a consequence provide a more accurate financial picture of the current as well as future state of any retailer.
Channel growth: Comp store sales should be part of a three-pronged reporting approach. Retailers should call out their quarterly growth online, in-store, and direct channels. Obviously this will be different depending on the business model. Amazon and Overstock would not report in-store sales. But there is no better measure of retail performance than the ability to keep pace with the consumer’s desire to work different channels for purchase, information, and returns. Retailers should be judged on how they grow in all relevant areas. Retail executives don’t manage toward an obsessive focus on comp store sales, they manage across channels. So why are they still judged so simplistically?
Conversion Rates: Online conversion rates hover around three percent. In-store conversion rates are too inconsistent to measure, but could be measured if retailers focused doing so. Conversion rates are a true measure of how attractive pricing, promotion, and service are working. Example: The 80 percent increase in online conversion rates measured recently at Urban Outfitters should say more about the strategy and practices of that operation than comp store sales. And when compared on a quarterly basis, analysts will know more about “what works” instead of the short term and potentially misleading metric of “what sold.”
Customer Satisfaction: Customer experience, especially in a cross-channel world, can be an excellent predictor for retailers. Circuit City, for example, is investing a lot of money in sales associate technology as well as new store formats. If they reported the results of these efforts in terms of customer experience by settling on a consistent metric such as NetPromoter, it would say more about its future value than its sales of expensive electronics in an economy as tight as this one.
Traffic: Not just foot traffic. In the cross-channel world an increase in web site traffic can predict increased product research and an increased intent to purchase. A decline in web site traffic means the online component of a retailer operation has lost momentum. Once again, all these indicators can and should be judged holistically.
Customer Engagement: Analysts should know open and click through rates of marketing campaigns. They should know metrics about call center activity. They should know loyalty program registrations and points redeemed. They should know email response rates. All these metrics show the willingness customers have to take a relationship beyond simple purchases. Customer engagement is tricky to measure as an aggregate behavior. But it is a potentially powerful indicator of long-term retail financial fitness.
The Wall Street focus on comp store sales will not change in a day. And analysts will continue to weight those results heavily. But at the very least retailers can begin to prepare more relevant reporting information, and begin to work on a metric and an attitude that needs to be dragged into the cross-channel world.
Thursday, September 25, 2008
Experts Say Recent Wall Street Tumbles Could Further Rattle Consumer Psyche
The roller coaster ride that is the financial marketplace over the past month will not affect retail open-to-buy dollars or inventories for the holiday season. But experts say retailers should get used to a phrase that will become much more important than any government bailout. That phrase: “the psyche of the American consumer.”
“Retail stocks may have hit their bottom in July. The real fluctuations are in the psyche of the American consumer,” says Bob Carbonell, EVP and Chief Credit Officer of retail financial analyst firm Bernard Sands. “What is the American housewife going to do this Christmas? The holiday season is everything, much more so this year than any other year.”
Prognostications from most every corner say that psyche is rattled and cautious. Holiday spending will most certainly be well off last year’s pace. But the depth of that decrease, the products that will succeed in hitting sales goals, the retailers that will attract customers, and the channels that will prevail are still very much in play. One relief can be found in the sound fundamental structure of retail purchase budgets and the credit necessary to execute them. Experts point to three reasons for that stability:
1. Timing: It’s simply too late in the sales cycle to back out of inventory commitments. “There’s just not a whole lot of time left in terms of actionable steps retailers can take, if they wanted to,” says Aberdeen retail analyst Ben Ream.
2. Retail Financing is Solid: Carbonell points out that the banks that lend most of the money to key retailers have not been caught up in the mortgage-based securities that have crippled many firms. Bank of America Retail Finance, GE Captial, and LaSalle financial are among the retail lending leaders and have established themselves as liquid.
3. Business Model Simplicity: Retailing is retailing, say many experts. “You buy stuff, you sell stuff, you answer questions politely, you treat your customers well,” says Carbonell. “Retailing has remained true to some very basic tenets and has avoided some of the complex issues that have hurt other businesses.”
Outside of the core fundamentals, retailing has become more complex in how goods are sold and how information is accessed. Therefore the cross-channel framework may be more important in addressing the damaged psyche of the cross-channel customer. Ream believes consumers will go “the extra mile” in terms of product research, price comparisons, product reviews and store locations this year in order to ensure that the purchase decisions they do make will be the most informed. Ream urges retailers to heavy up on cross-channel preparation and measurements. Understanding conversion rates in all channels, units per transaction, and repeat purchases are even more important to understand in a tough economy.
While open-to-buy dollars are expected to remain solid, promotional dollars have already taken a hit. Best Buy has officially announced an advertising cutback for the balance of the year, and tough Q3 numbers may lead more retailers to follow suit.
In terms of measuring the consumer psyche, Carbonell is looking toward Halloween as an early barometer. On a positive note, Visa has predicted an 18% bounce for Halloween, even after the stock market slide. The average person will spend $47 on candy and decorations, this year, up from the $40 Americans reported they were planning to spend on Halloween last year.
"Depriving our children, and our neighbors' children, of Halloween trick or treating is not something Americans seem willing to bear," said Jason Alderman, Director of Financial Education at Visa Inc.
Retailers arehoping that will hold true for spending around year-end holidays as well.
“Retail stocks may have hit their bottom in July. The real fluctuations are in the psyche of the American consumer,” says Bob Carbonell, EVP and Chief Credit Officer of retail financial analyst firm Bernard Sands. “What is the American housewife going to do this Christmas? The holiday season is everything, much more so this year than any other year.”
Prognostications from most every corner say that psyche is rattled and cautious. Holiday spending will most certainly be well off last year’s pace. But the depth of that decrease, the products that will succeed in hitting sales goals, the retailers that will attract customers, and the channels that will prevail are still very much in play. One relief can be found in the sound fundamental structure of retail purchase budgets and the credit necessary to execute them. Experts point to three reasons for that stability:
1. Timing: It’s simply too late in the sales cycle to back out of inventory commitments. “There’s just not a whole lot of time left in terms of actionable steps retailers can take, if they wanted to,” says Aberdeen retail analyst Ben Ream.
2. Retail Financing is Solid: Carbonell points out that the banks that lend most of the money to key retailers have not been caught up in the mortgage-based securities that have crippled many firms. Bank of America Retail Finance, GE Captial, and LaSalle financial are among the retail lending leaders and have established themselves as liquid.
3. Business Model Simplicity: Retailing is retailing, say many experts. “You buy stuff, you sell stuff, you answer questions politely, you treat your customers well,” says Carbonell. “Retailing has remained true to some very basic tenets and has avoided some of the complex issues that have hurt other businesses.”
Outside of the core fundamentals, retailing has become more complex in how goods are sold and how information is accessed. Therefore the cross-channel framework may be more important in addressing the damaged psyche of the cross-channel customer. Ream believes consumers will go “the extra mile” in terms of product research, price comparisons, product reviews and store locations this year in order to ensure that the purchase decisions they do make will be the most informed. Ream urges retailers to heavy up on cross-channel preparation and measurements. Understanding conversion rates in all channels, units per transaction, and repeat purchases are even more important to understand in a tough economy.
While open-to-buy dollars are expected to remain solid, promotional dollars have already taken a hit. Best Buy has officially announced an advertising cutback for the balance of the year, and tough Q3 numbers may lead more retailers to follow suit.
In terms of measuring the consumer psyche, Carbonell is looking toward Halloween as an early barometer. On a positive note, Visa has predicted an 18% bounce for Halloween, even after the stock market slide. The average person will spend $47 on candy and decorations, this year, up from the $40 Americans reported they were planning to spend on Halloween last year.
"Depriving our children, and our neighbors' children, of Halloween trick or treating is not something Americans seem willing to bear," said Jason Alderman, Director of Financial Education at Visa Inc.
Retailers arehoping that will hold true for spending around year-end holidays as well.
Thursday, September 11, 2008
With Shopping Trips Down, Retailers See Redemption Rates Soar On Work Targeted Promos
Fueled by rising gas prices and a slow economy, more consumers are shopping near work or on their commute route, according to recent research. In the August 2008 Consumer Intentions and Action survey from BIGresearch, 57.2 percent of respondents indicated they will be driving less because of gas prices. In addition, 54.4 percent said they would be taking “fewer shopping trips.”
By targeting “commute route shoppers,” one grocery chain recorded its strongest promotion results to date, according to Stephanie Molnar, CEO of WorkPlace Media, the promotion provider. The grocery chain’s coupon redemption exceeded 20 percent in a typical four- to eight-week promotion period. “I would have estimated a low single digit response and was shocked,” notes Molnar.
WorkPlace Media, in business for more than 20 years, has traditionally targeted the restaurant/foodservice industry with its workplace promotion solutions, but has recently begun to focus on other types of retail, including grocery and convenience stores. Some of its most well-known clients include Sheetz, Kmart, Lenscrafters and McDonalds.
The results of WorkPlace Media’s promotions are impressive. In the past year, grocery redemption averaged 11.3 percent, other retail/non-grocery averaged 8.06 percent, and all programs (including restaurants and CPG) averaged 8.99 percent, Molnar reports.
To get their errands and chores done, many consumers are combining their daily drive to and from work with stops for shopping, more than ever. “Historically the working consumer spends 60 percent of his or her waking hours at work or commuting to and from,” notes Molnar. “They are efficient in their shopping patterns, but even more so with the advent of high fuel costs.”
Commuters are taking care of a number of different types of errands during their drive to and from work, according to BIGresearch, in its At-Work Consumer Media & Shopping Behavior survey from December 2007:
Workers more likely to redeem
Marketing to workplace consumers has proven fruitful. Consumers who receive shopping promotions in the workplace are three times more likely to respond to those offers compared to offers received at home, says Molnar.
It’s also a win-win for the sponsoring retailers and the employers, Molnar adds. For retailers, WorkPlace Media can provide real-time consumer feedback to find out intent to purchase, in-store experience, feedback about the promotion and more. Employers are happy because they are able to provide a free benefit to their employees, “and they enjoy distributing them, usually face-to-face,” says Molnar.
At press time, WorkPlace Media maintained a network of 920 businesses which voluntarily participate in the firm’s permission base, allowing WorkPlace to reach more than 64 million consumers. “When we survey our network we typically find out that 98 percent want to receive more workplace promotions in the future,” says Molnar.
To further flesh out the reasons why the workplace consumer is growing in importance as a target market, WorkPlace Media is conducting a webinar in conjunction with the Promotion Marketing Association, on September 16, 2008 at 2:00pm EST. Visit https://www.pmalink.org/shop/aw_091608.aspx for free registration.
By targeting “commute route shoppers,” one grocery chain recorded its strongest promotion results to date, according to Stephanie Molnar, CEO of WorkPlace Media, the promotion provider. The grocery chain’s coupon redemption exceeded 20 percent in a typical four- to eight-week promotion period. “I would have estimated a low single digit response and was shocked,” notes Molnar.
WorkPlace Media, in business for more than 20 years, has traditionally targeted the restaurant/foodservice industry with its workplace promotion solutions, but has recently begun to focus on other types of retail, including grocery and convenience stores. Some of its most well-known clients include Sheetz, Kmart, Lenscrafters and McDonalds.
The results of WorkPlace Media’s promotions are impressive. In the past year, grocery redemption averaged 11.3 percent, other retail/non-grocery averaged 8.06 percent, and all programs (including restaurants and CPG) averaged 8.99 percent, Molnar reports.
To get their errands and chores done, many consumers are combining their daily drive to and from work with stops for shopping, more than ever. “Historically the working consumer spends 60 percent of his or her waking hours at work or commuting to and from,” notes Molnar. “They are efficient in their shopping patterns, but even more so with the advent of high fuel costs.”
Commuters are taking care of a number of different types of errands during their drive to and from work, according to BIGresearch, in its At-Work Consumer Media & Shopping Behavior survey from December 2007:
• 74 percent dine out during or to and from workIn addition, during work consumers often skip lunch and take care of shopping: 61 percent for apparel, 53 percent for beauty care and cosmetics, 48 percent for shoes and 24 percent for jewelry and watches.
• 72 percent purchase groceries and other food and beverages
• 56 percent are stopping to purchase medicines, vitamins and supplements
• 49 percent complete shores such as picking up dry-cleaning and purchasing new eyewear
• 35 percent get their cars serviced
Workers more likely to redeem
Marketing to workplace consumers has proven fruitful. Consumers who receive shopping promotions in the workplace are three times more likely to respond to those offers compared to offers received at home, says Molnar.
It’s also a win-win for the sponsoring retailers and the employers, Molnar adds. For retailers, WorkPlace Media can provide real-time consumer feedback to find out intent to purchase, in-store experience, feedback about the promotion and more. Employers are happy because they are able to provide a free benefit to their employees, “and they enjoy distributing them, usually face-to-face,” says Molnar.
At press time, WorkPlace Media maintained a network of 920 businesses which voluntarily participate in the firm’s permission base, allowing WorkPlace to reach more than 64 million consumers. “When we survey our network we typically find out that 98 percent want to receive more workplace promotions in the future,” says Molnar.
To further flesh out the reasons why the workplace consumer is growing in importance as a target market, WorkPlace Media is conducting a webinar in conjunction with the Promotion Marketing Association, on September 16, 2008 at 2:00pm EST. Visit https://www.pmalink.org/shop/aw_091608.aspx for free registration.
Thursday, August 14, 2008
Survey Says Fewer Brand Decisions Made at the Shelf
By George Anderson, RetailWire
Editor’s Note: This article is an excerpt from one of RetailWire’s recent online discussions. Each business morning on RetailWire.com, retail industry executives get plugged in to the latest news and issues with key insights from a “BrainTrust” of retail industry experts.
As an AdAge.com article points out, it has become common for those in consumer products to state that 70% of all decisions on what brand to buy are made at the shelf. A new study from OgilvyAction contends that it's time to throw out the old number and go with a new and lower one.
According to the study, 39.4% number is the real number of consumers who wait until they're in a store before deciding what brand to buy. About 10% change their minds while in the store and 20% leave a product on the shelf that they intended to buy. Nearly 30% of consumers wind up making a purchase from a category that they didn't intend to buy from before walking into a store.
"That 70% figure we've all heard over the years always sounded a little high, and we all know it's a little high," said Peter Hoyt, executive director of the In-Store Marketing Institute. "Some think it's a lot high. I think what the Ogilvy study does effectively is help decompose [the data]. I think it's closer to what we can accept as statistics having some validity. ... But it's not that 70% of every shopping cart is made up of something people didn't [originally] intend to buy. That's just not real."
The original 70% study was conducted in 1995 by Meyers Research Center for the Point of Purchase Advertising Institute (POPAI). In a statement, POPAI continued to support the 1995 findings. "There have been various studies that have arrived at different in-store decision rates over the years, based on unique methodologies, trade channels, and the context and location of consumer interviews. POPAI welcomes any research that helps brands, retailers and agencies understand the strategic importance of marketing at retail."
The OgilvyAction study was based on interviews with 6,800 consumers in the U.S. (14,000 total across the globe) and covered shopping behavior in 13 categories including beverages, confectionary, hair care, and household cleaning products.
While the new research failed to answer just how much advertising outside the store environment influences purchases, it did determine important factors that drive impulse purchases. Sampling and product displays ranked one and two.
"The good news for marketers is that a product display and sampling can build brand equity," Jeff Froud, senior strategic planner for OgilvyAction, told AdAge.com. "No matter what rulebook you studied when you were studying marketing, price promotions don't build any brand equity and in some cases can be equity destroyers."
"More and more of our communication is moving to store," A.G. Lafley, chairman and chief executive at Procter & Gamble, said last month at the International Advertising Festival in Cannes. "And the reason it's moving to store is that more and more consumers are... making their purchase decisions in store. And in a period where you have a fair amount of food price inflation, we think more of that shopping list, whether it's just in [a shopper's] head or actually written down, is being decided in the store."
Pursue at the Point of Purchase
“Getting through to the consumer with your product message and features is easier and more effective at the point of purchase,” says Dan Nelson, CEO of Leadership Resources. “The amount of clutter in more traditional media and the options of what consumers watch, read and view on the internet and cable has made effective use of advertising dollars much more difficult.”
One analyst acknowledges the impact of sampling and product displays on sales. “Whether it's 70% or 40%, the key point here is the immense opportunity that retailers and their suppliers have to dramatically influence consumer buying behaviors,” says Kevin Graff, president of Graff Retail. “Now, imagine if you can the impact you could make on performance if you could engage the workforce in the stores to the point that they become brand ambassadors, both for the store itself and for key products.”
The power of reviews and targeted offers are the way to go, says one analyst. “Impulse shopping is alive and well. But the shelf is now digital,” according to Liz Crawford, president of Crawford Consulting. “Increasing dwell time at the shelf, whether 3D or virtual, is still the name of the game. The field has moved, but the game is still afoot.”
Friday, August 1, 2008
Will The Logo Mean A Kinder, Cooler Wal-Mart? Can The Retail Giant Live Up to the Logo Change
By Andrew, Bogucki, Principal & Creative
Retail monolith Wal-Mart has taken the plunge and changed its identity. While I’m referring specifically to the logo and all the design elements that support it, a new aesthetic identity can also indicate a shift in a company’s corporate identity in a more universal sense.
Changing a corporate or brand identity is a big undertaking. When done right, it sends a powerful signal to the outside world. It makes you sit up and take notice, ready to hear the rest of the story. But if there is no story… well, it can do more harm than good.
Changing a logo, to use a personal analogy, is a little like changing your “look”: new wardrobe, new hairstyle, new glasses, etc. It sends a signal that something about you is new or has changed. When the loveable but slightly scruffy and lazy mailroom guy suddenly shows up to work clean-shaven and wearing a bespoke suit, people will notice. The message he’s sending is: “I’m not lazy anymore! Give me the chance and I’ll prove it to you!” And if, in fact, he changes his lackadaisical ways and becomes more disciplined and pro-active, then management may truly see him in a new light, and potentially offer him new opportunities.
But if the new suit is simply a cover-up for the same old lazy habits, the message he is sending is hollow, and will quite likely bring even more scrutiny. The same principle is true for companies and brands.
Truth be told, perceptions of the highly profitable Wal-Mart have started to suffer from decades of aggressive business practices and dubious employment policies. Now the bulk of the revenue-generating customer base might not be paying much attention to those issues. But on top of that, the world’s richest company has always had a decidedly un-cool, low-end, bargain-basement image. There’s no question that a re-positioning on some level is in order. So what’s Wal-Mart’s new story? Well, based on cryptic postings like this (sourced from identityworks.com), it sounds like a touch-up:
“This update to the logo is simply a reflection of the refresh taking place inside our stores and our renewed sense of purpose to help people save money so they can live better. The updated logo won’t begin to appear on storefronts until the fall."
In contradiction, the logo seems to be signaling a bigger personality shift than that. The former bold, all-caps, industrial strength typography has been replaced with a lighter, friendlier, upper- and lower-case treatment. This makes the name feel more approachable, as though being used in a conversation instead of an institutional pronouncement. The deep, monopolistic blue has been traded for brighter, less ominous cyan. This adds a certain freshness and energy to the mark. The military-style star has turned into a bright yellow spark. While not the most own-able symbol one could choose, it certainly feels more contemporary, optimistic, and yes, lively. And the hyphenated WAL-MART has become the single word Walmart, making it feel like a proper name, instead of a coined reminder of the mega-retailer’s somewhat humble roots. All-in-all, the logo change sets expectations for a pretty different version of the Wal-Mart experience.
The store environments themselves need to play a big role in that experience. The obvious competitor in the mega-retail space is Target, which has always understood the value of good design in all aspects of the brand experience; and its favorability scores overtook Wal-Mart’s last year in CoreBrand’s Brand Power Analysis. Shopping at a Target (while not exactly like browsing specialty shops and boutiques in, say, Paris) is certainly a different experience than shopping at a Wal-Mart. Much of the merchandise at Target tends to be better designed; the graphics and packaging are more sophisticated; the overall environment feels downright warm and inviting compared to Wal-Mart’s stark, fluorescent, Five-and-Dime glare. Revamping the in-store experience for Wal-Mart should be a large part of signaling change. What those changes are remain to be seen.
So what’s the rest of the story? At a cursory glance, certain changes are noticeable. Wal-Mart is stocking and promoting many “green” products, demonstrating not only environmental-consciousness, but purportedly allowing families to save money in energy usage. Their new high-production-value commercials feature lifestyle and benefit messaging, a shift from the pure price-slashing message from before. And new licensing deals are being sought out, such as an exclusive clothing line from rapper Master P, to add a hip, contemporary edge to the image.
It’s certainly a start. Wal-Mart is a mighty big ship to turn around, with a fair amount of brand baggage to purge before perceptions can really begin to change. Sheer scale, longevity, aggressiveness and ubiquity have woven Wal-Mart quite firmly into a very specific part of American, and increasingly world, culture. The new logo signals a pretty big change. Can they back it up? We’ll just have to wait and see.
directs all creative activities at CoreBrand. Before joining CoreBrand,
Andrew was Design Director at Interbrand where he was integral in creating
corporate identity systems for clients such as MCI, 3M, and BankBoston.
Since joining CoreBrand, Andrew has developed a full range of design and
identity systems for numerous global brands including AT&T, American Century
Investments, BearingPoint, Catalent, MasterCard Worldwide, Tektronix, and
Thomson.
Monday, May 12, 2008
Retailers Learn It's Not Easy Being Green, But Continue Investing
By Debbie Hauss, Executive Editor
Retailers are treading lightly in the green marketplace, taking note that consumers are skeptical and reticent to commit to trading much of their “green” for green merchandise. Although a large percentage of consumers (81.9 percent) say they have incorporated some level of green activity into their lives, most of their efforts do not translate to dollar signs at retail, according to a recent survey of more than 6,000 consumers conducted by Burst Media.
It turns out that the consumers respond most positively to green messages about recycling and healthy recipes, then alternative energy sources, natural remedies, eco-friendly cleaning products, green technologies, nature/outdoor recreations, tips for simple living, gardening/organic gardening, and organic foods, Burst reports. The bottom line is that the retailers offering products related to these subject areas are most likely to be successful.
A new Benchmark report from RSR Research also validated that retailers are moving forward with green initiatives, despite the fact that many respondents are not yet seeing a big shift consumer spending toward green products and services. The RSR Research report, 62% of retail respondents said consumers are not yet spending on green products, however 44% said green initiatives are still strategic initiative in their company. The motivations for the green practices include ethical obligations as well as cost concerns.
Green food is a Natural
Supermarket retailers, in particular, are faring well in this area by offering more organic and whole foods, as well as environmentally friendly programs. This is a trend that has been in place for a number of years and is growing. It started with brands like Whole Foods and Trader Joe’s but is slowly infiltrating more mainstream grocers, such as Kroger, Supervalu and Safeway.
The mainstream supermarket retailers are hoping to benefit from offering lower prices for their organic goods compared to the specialty stores, which should be especially palatable to consumers in 2008 who are struggling with higher food prices, as well as increasing gas prices and other financial issues related to the current recession economy.
Some recent activity in this segment includes:
· Kroger introduced a plastic recycling program and is promoting is through an online contest called “Design Kroger’s Next Reusable Bag.”
· Safeway is banking on its line of private label organic products and some new Lifestyle store formats
· Supervalu-owned Acme Markets opened the first environmentally friendly supermarket in the Philadelphia, Pennsylvania area in April. The new store was built according to Leadership in Energy and Environmental Design (LEED) form the U.S. Green Building Council. For the Supervalu stores, the company is adding private label organic food products after failing with a small line of organic markets, introduced in 2005 under the Sunflower Markets brand.
· Tesco entered the U.S. market with its Fresh & Easy chain which focuses on healthy, reasonably priced prepared foods.
In a recent report, released in March by Citibank Global Markets, analyst Deborah Weinswig noted Kroger and Safeway as the stores best positioned to gain share from bigger, national brands.
Sustainability the word of the day
While “organic” has been the term most closely associated with healthier, better choices for food products, the term “sustainability” is taking over as the all-encompassing term that may help to attract consumers to other types of retailers.
Touted as Wal-Mart’s largest “sustainability” campaign to date, the retail giant’s Earth Day 2008 effort used advertising, in-store displays and featured products to reinforce Wal-Mart’s goal of making sustainable products available to customers at affordable prices, the company reported. Wal-Mart also has micro sites available for consumers including walmart.com/sustainability, walmart.com/green and walmart.com/earth. The company is selling more than 50 green products in-store and more than 500 online.
Home Depot introduced its Eco Options label in 2007, which includes 3,000 products from compact fluorescent lights to organic plants. The brand sold as well or better than similar products, exceeding sales goals and reaching $3 billion, the company reported.
The Marketing Challenge
A number of barriers are stalling retail sales of green products, including limited product availability due to uncertain consumer demand, and inconsistent product standards. In addition, consumers are less-than-confident in the green marketing messages from advertisers, according to Burst Media. The Burst survey found that 22.7 percent of respondents say they seldom or never believe green claims made in advertisements, and 65.3 percent said they “sometimes” believe the claims.
To help steer consumers in the right direction, one third-party source, called thepurplebook green, is offering a guide to green shopping online. Companies that sell their green products online are invited to submit their site for inclusion in the guide at www.thepurplebook.com. The sites and the products are then reviewed by thepurplebook staff and consumer feedback is considered to determine if that site will be included in the book as a recommended retailer.
Is green a viable, long-term market segment or a passing trend? The jury is still out.
Retailers are treading lightly in the green marketplace, taking note that consumers are skeptical and reticent to commit to trading much of their “green” for green merchandise. Although a large percentage of consumers (81.9 percent) say they have incorporated some level of green activity into their lives, most of their efforts do not translate to dollar signs at retail, according to a recent survey of more than 6,000 consumers conducted by Burst Media.
It turns out that the consumers respond most positively to green messages about recycling and healthy recipes, then alternative energy sources, natural remedies, eco-friendly cleaning products, green technologies, nature/outdoor recreations, tips for simple living, gardening/organic gardening, and organic foods, Burst reports. The bottom line is that the retailers offering products related to these subject areas are most likely to be successful.
A new Benchmark report from RSR Research also validated that retailers are moving forward with green initiatives, despite the fact that many respondents are not yet seeing a big shift consumer spending toward green products and services. The RSR Research report, 62% of retail respondents said consumers are not yet spending on green products, however 44% said green initiatives are still strategic initiative in their company. The motivations for the green practices include ethical obligations as well as cost concerns.
Green food is a Natural
Supermarket retailers, in particular, are faring well in this area by offering more organic and whole foods, as well as environmentally friendly programs. This is a trend that has been in place for a number of years and is growing. It started with brands like Whole Foods and Trader Joe’s but is slowly infiltrating more mainstream grocers, such as Kroger, Supervalu and Safeway.
The mainstream supermarket retailers are hoping to benefit from offering lower prices for their organic goods compared to the specialty stores, which should be especially palatable to consumers in 2008 who are struggling with higher food prices, as well as increasing gas prices and other financial issues related to the current recession economy.
Some recent activity in this segment includes:
· Kroger introduced a plastic recycling program and is promoting is through an online contest called “Design Kroger’s Next Reusable Bag.”
· Safeway is banking on its line of private label organic products and some new Lifestyle store formats
· Supervalu-owned Acme Markets opened the first environmentally friendly supermarket in the Philadelphia, Pennsylvania area in April. The new store was built according to Leadership in Energy and Environmental Design (LEED) form the U.S. Green Building Council. For the Supervalu stores, the company is adding private label organic food products after failing with a small line of organic markets, introduced in 2005 under the Sunflower Markets brand.
· Tesco entered the U.S. market with its Fresh & Easy chain which focuses on healthy, reasonably priced prepared foods.
In a recent report, released in March by Citibank Global Markets, analyst Deborah Weinswig noted Kroger and Safeway as the stores best positioned to gain share from bigger, national brands.
Sustainability the word of the day
While “organic” has been the term most closely associated with healthier, better choices for food products, the term “sustainability” is taking over as the all-encompassing term that may help to attract consumers to other types of retailers.
Touted as Wal-Mart’s largest “sustainability” campaign to date, the retail giant’s Earth Day 2008 effort used advertising, in-store displays and featured products to reinforce Wal-Mart’s goal of making sustainable products available to customers at affordable prices, the company reported. Wal-Mart also has micro sites available for consumers including walmart.com/sustainability, walmart.com/green and walmart.com/earth. The company is selling more than 50 green products in-store and more than 500 online.
Home Depot introduced its Eco Options label in 2007, which includes 3,000 products from compact fluorescent lights to organic plants. The brand sold as well or better than similar products, exceeding sales goals and reaching $3 billion, the company reported.
The Marketing Challenge
A number of barriers are stalling retail sales of green products, including limited product availability due to uncertain consumer demand, and inconsistent product standards. In addition, consumers are less-than-confident in the green marketing messages from advertisers, according to Burst Media. The Burst survey found that 22.7 percent of respondents say they seldom or never believe green claims made in advertisements, and 65.3 percent said they “sometimes” believe the claims.
To help steer consumers in the right direction, one third-party source, called thepurplebook green, is offering a guide to green shopping online. Companies that sell their green products online are invited to submit their site for inclusion in the guide at www.thepurplebook.com. The sites and the products are then reviewed by thepurplebook staff and consumer feedback is considered to determine if that site will be included in the book as a recommended retailer.
Is green a viable, long-term market segment or a passing trend? The jury is still out.
Monday, March 3, 2008
Experts Offer Strategies On How Retailers Can Crack The Code On Mobile Marketing
By Amanda Ferrante, Assistant Editor
After seeing coupon redemption rates of 50% in its initial 12 test stores, Subway Restaurants recently expanded its “My Subway Mobile” campaign to more than 100 locations. The chain is now offering a dozen different promotional offers to more than 5,500 customers through the program, which is managed using a service from Modiv Media.
In another recent indication of the power of mobile marketing, Papa John’s Pizza recent Super Bowl campaign, “TEXTRA Points for Pizza,” drew over 115,000 registrants who were looking to score super discounts on pizza based on the final outcome of the big game.
While many of the early success stories around mobile marketing have been in the QSR sector, industry analysts suggest there are significant opportunities for other retailers to get in on the mobile action.
“The possibilities for mobile marketing are endless,” says Brad Beasley, president of CrossLink Media, a mobile marketing company offering both messaging and Bluetooth ad-serving software. MessageLink, the company’s proprietary messaging system, executes mobile campaigns via a secure online interface that enables clients to log in and create, modify, and deploy within minutes.
In addition, MessageLink provides a fully automated CRM solution offering additional information and request follow-up communication. “MessageLink provides a great CRM tool as clients now have immediate interaction with their mobile database and can reach these customers anytime, anywhere via the consumer’s most personal device – the wireless phone,” says Beasley.
MessageLink also controls CrossLink’s “Txt 2 Buy” feature that enables consumers to purchase products directly from their wireless phone and makes every advertisement and communication with the consumer an immediate point-of-sale opportunity. With Txt 2 Buy, consumers don’t need to wait until they get online to place an order, nor do they have to wait on the phone for an operator to complete the order.
Beasley says the highlights of mobile marketing include the following potential payoffs for retailers:
Ø 1-to-1 interaction with consumers vs. mass communication
Ø Measurable results
Ø Increased store traffic
Ø Increased impulse buys
Ø 24 x7 x 365 access
Ø Ability to reach only those customers who have specifically asked to receive your offers. No more wasted advertising
DIALING UP URGENCY
Andy Nulman, CMO of Airborne Entertainment, a mobile marketing company that’s worked with major brands such as Taco Bell, Maxim Magazine, and the NHL, agrees there is a big opportunity for retailers to cash in on the immediacy that the mobile medium provides.“It’s not about technology, it’s about people. People are interested in finding deals. Mobile marketing is just getting off the ground…the time is right now.” Nulman builds his case for mobile marketing around the acronym NOW, pointing to the following strategies:
Nearby: “Customers need to be in your radius, close, local. Shoppers aren’t traveling very far for a pair of jeans.”
Only: “There has to be a limit. Create a sense of urgency for your campaign. Establish a relationship to create an addicted customer.”
Wow: “Make a compelling offer. Make consumers opt in for select communication. You want them to come sporadically.”
A few of the key benefits of mobile marketing Nulman points to include the local drawing power of mobile media and the urgency that is created by text messages. “It is also dynamic so that you can take action when you need to. Do you have an empty store? Do something about it,” Nulman says. He offers the following 5 strategies retailers can employ to take advantage of the rapid growth of mobile marketing:
1. The NOW Psst: “Limited time offers, but they need to be engaging and special. Target people near your location.
The Secret Sale: Things like in-store sales, or special offers. Having consumers text to a special number will provide them with a message/discount/coupon. It’s completely opt-in and there are no paper costs.”
2. Random Discounts: “For instance, have promos that allow consumers to text for specific discounts, coupon codes, etc.”
3. The In-store Experience: “Give the customer control of what they want. Get them additional information like the back-story on products. When you make products more people-oriented, like Gap’s Red campaign, it becomes personal, and people will want to buy. Let consumers feel like they have the inside scoop.”
4. The Countdown: “Let the shoppers know that time is running out to save. Text alerts like ‘Only ten pairs left’ with an image of the product. And do so whenever there’s a new number to report. This creates urgency and keeps the customer’s mind on the store.”
5. Develop WAP Sites: Create a mini website for people to view on their phone. Keep it simple with your company logo and plain text. This lets people know what’s going on in your store.”
Another point of value in the mobile phone is its capability to increase customer loyalty. Dustin Young, Vice President of Emerging Technologies at InComm, a leading distributor of stored-value gift and prepaid products with over 145,000 retailers, says there are three points of true value in utilizing the mobile phone as a CRM tool:
· Provide the retailer with a cost effective channel;
· Provide the consumer with a user-friendly way of accessing unique offers, like an abbreviated dial code;
· The ability of the merchant to tie coupons to existing vehicles of POS code
After seeing coupon redemption rates of 50% in its initial 12 test stores, Subway Restaurants recently expanded its “My Subway Mobile” campaign to more than 100 locations. The chain is now offering a dozen different promotional offers to more than 5,500 customers through the program, which is managed using a service from Modiv Media.
In another recent indication of the power of mobile marketing, Papa John’s Pizza recent Super Bowl campaign, “TEXTRA Points for Pizza,” drew over 115,000 registrants who were looking to score super discounts on pizza based on the final outcome of the big game.
While many of the early success stories around mobile marketing have been in the QSR sector, industry analysts suggest there are significant opportunities for other retailers to get in on the mobile action.
“The possibilities for mobile marketing are endless,” says Brad Beasley, president of CrossLink Media, a mobile marketing company offering both messaging and Bluetooth ad-serving software. MessageLink, the company’s proprietary messaging system, executes mobile campaigns via a secure online interface that enables clients to log in and create, modify, and deploy within minutes.
In addition, MessageLink provides a fully automated CRM solution offering additional information and request follow-up communication. “MessageLink provides a great CRM tool as clients now have immediate interaction with their mobile database and can reach these customers anytime, anywhere via the consumer’s most personal device – the wireless phone,” says Beasley.
MessageLink also controls CrossLink’s “Txt 2 Buy” feature that enables consumers to purchase products directly from their wireless phone and makes every advertisement and communication with the consumer an immediate point-of-sale opportunity. With Txt 2 Buy, consumers don’t need to wait until they get online to place an order, nor do they have to wait on the phone for an operator to complete the order.
Beasley says the highlights of mobile marketing include the following potential payoffs for retailers:
Ø 1-to-1 interaction with consumers vs. mass communication
Ø Measurable results
Ø Increased store traffic
Ø Increased impulse buys
Ø 24 x7 x 365 access
Ø Ability to reach only those customers who have specifically asked to receive your offers. No more wasted advertising
DIALING UP URGENCY
Andy Nulman, CMO of Airborne Entertainment, a mobile marketing company that’s worked with major brands such as Taco Bell, Maxim Magazine, and the NHL, agrees there is a big opportunity for retailers to cash in on the immediacy that the mobile medium provides.“It’s not about technology, it’s about people. People are interested in finding deals. Mobile marketing is just getting off the ground…the time is right now.” Nulman builds his case for mobile marketing around the acronym NOW, pointing to the following strategies:
Nearby: “Customers need to be in your radius, close, local. Shoppers aren’t traveling very far for a pair of jeans.”
Only: “There has to be a limit. Create a sense of urgency for your campaign. Establish a relationship to create an addicted customer.”
Wow: “Make a compelling offer. Make consumers opt in for select communication. You want them to come sporadically.”
A few of the key benefits of mobile marketing Nulman points to include the local drawing power of mobile media and the urgency that is created by text messages. “It is also dynamic so that you can take action when you need to. Do you have an empty store? Do something about it,” Nulman says. He offers the following 5 strategies retailers can employ to take advantage of the rapid growth of mobile marketing:
1. The NOW Psst: “Limited time offers, but they need to be engaging and special. Target people near your location.
The Secret Sale: Things like in-store sales, or special offers. Having consumers text to a special number will provide them with a message/discount/coupon. It’s completely opt-in and there are no paper costs.”
2. Random Discounts: “For instance, have promos that allow consumers to text for specific discounts, coupon codes, etc.”
3. The In-store Experience: “Give the customer control of what they want. Get them additional information like the back-story on products. When you make products more people-oriented, like Gap’s Red campaign, it becomes personal, and people will want to buy. Let consumers feel like they have the inside scoop.”
4. The Countdown: “Let the shoppers know that time is running out to save. Text alerts like ‘Only ten pairs left’ with an image of the product. And do so whenever there’s a new number to report. This creates urgency and keeps the customer’s mind on the store.”
5. Develop WAP Sites: Create a mini website for people to view on their phone. Keep it simple with your company logo and plain text. This lets people know what’s going on in your store.”
Another point of value in the mobile phone is its capability to increase customer loyalty. Dustin Young, Vice President of Emerging Technologies at InComm, a leading distributor of stored-value gift and prepaid products with over 145,000 retailers, says there are three points of true value in utilizing the mobile phone as a CRM tool:
· Provide the retailer with a cost effective channel;
· Provide the consumer with a user-friendly way of accessing unique offers, like an abbreviated dial code;
· The ability of the merchant to tie coupons to existing vehicles of POS code
Thursday, January 17, 2008
Office Max "Elf Yourself" Final Results Are In
By Amanda Ferrante, Assistant Editor
Even if you didn't create your own Elf on ElfYourself.com this holiday season, you probably opened your inbox to the big hit that infiltrated pop culture with a huge viral impact.
Elf Yourself 2007
The Elfin' Impact from 11/20/07 to 1/2/08 :
- Over 193 million site visits
- Over 123 million elves were created
- 60 elves were created per second
- Users spent a combined average of 2,600 years on the site
- Ranked #51 most visited website on the web (HitWise Intelligence)
- Ranked #1 on "Movers & Shakers" (Alexa Rankings)
- Ranked as top 1,000 website in 50 countries (Alexa Rankings)
- Featured on CNN American Morning, ABC World News, Good Morning America , The Today Show, TNT Sports News, Fox News, & Rosie O'Donnell's blog.
Elizabeth McDowell, Publicist for EVB San Francisco, the co-creator of "Elf Yourself," says "The success is in part due to three fundamental characteristics 1) Keep it Simple 2) Make it Personal and 3) Give People a Reason to Pass it on."
Discussions for a 2008 version of last holiday season's favorite online activity are underway.
Even if you didn't create your own Elf on ElfYourself.com this holiday season, you probably opened your inbox to the big hit that infiltrated pop culture with a huge viral impact.
Elf Yourself 2007
The Elfin' Impact from 11/20/07 to 1/2/08 :
- Over 193 million site visits
- Over 123 million elves were created
- 60 elves were created per second
- Users spent a combined average of 2,600 years on the site
- Ranked #51 most visited website on the web (HitWise Intelligence)
- Ranked #1 on "Movers & Shakers" (Alexa Rankings)
- Ranked as top 1,000 website in 50 countries (Alexa Rankings)
- Featured on CNN American Morning, ABC World News, Good Morning America , The Today Show, TNT Sports News, Fox News, & Rosie O'Donnell's blog.
Elizabeth McDowell, Publicist for EVB San Francisco, the co-creator of "Elf Yourself," says "The success is in part due to three fundamental characteristics 1) Keep it Simple 2) Make it Personal and 3) Give People a Reason to Pass it on."
Discussions for a 2008 version of last holiday season's favorite online activity are underway.
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