Category Archives: Merchandising and Marketing

by Jennifer Bosavage

Sometimes, Self-Service Is All the Interaction Needed

Remember the Looney Tunes cartoon with Pepe Le Pew and the little black cat? Poor Pepe struggles with an inability to pick up on the cues that his beloved really just doesn’t want to be bothered. She prefers to remain alone, solo, all by herself — you get the picture. To go about her business as she pleases.

Retail customer trends reveal that consumers still choose brick-and-mortar store locations for a significant portion of their shopping.

Retail customer trends reveal that consumers still choose brick-and-mortar store locations for a significant portion of their shopping.

Much has been made of retailers wanting to free associates from the cash wrap to interact with customers. The theory is that by creating a relationship between associates and shoppers, sales will increase. However, there is evidence that, in fact, in various circumstances just the opposite can occur.

A study last year by the Coleman Fung Institute at the University of California, Berkley, considered two situations. In the first, liquor stores in Sweden converted from full-service to self service format. Researchers found that not only did those stores offer a wider variety of products in the aftermath of the switch, but also that sales rose, particularly of products with difficult-to-pronounce names:

“Products with difficult-to-pronounce names might experience such a sales increase because consumers may fear being misunderstood or appearing unsophisticated if they mispronounce a name when ordering from a sales clerk; once a store introduces a self-service format and eliminates the need to pronounce a name, consumers may become more comfortable pursuing an otherwise mildly embarrassing or frustrating transaction.”

In other words, having sales staff on hand, being personable and forming relationships with customers might, in some cases, have a detrimental impact on sales, as the customer does not want to appear ignorant. That suggestion is supported by the revenue figures: The market share of products with difficult-to-pronounce names increased 8.4% in stores that switched to self-service.

The second environment studied was that of a pizzeria that had just added Web-based ordering to its phone and counter-service offerings. The researchers found in this case that customers’ purchases of more complex items increased, and orders of higher calorie foods also rose:

“The increase in high calorie items might be driven by a desire to avoid negative social judgment of their eating habits, while the increase in the complexity might be driven by a desire to avoid negative social judgment by appearing difficult or unconventional.”

The average order was found to be 14% more complicated, and have, in general, 3% more calories.

Overall, the researchers come to a conclusion that psychologists have recognized for a long time: People avoid social interactions that they perceive to be uncomfortable. While the online pizza orderers may have wanted to exercise more control over accuracy, the report’s authors found that to be a contributing, but not sole, factor in the increase of more complex (and caloric) selections. Rather, individuals change their behavior to put forth a positive image, often to avoid being embarrassed.

For retailers, “forcing” a relationship on those who are uninterested may have the same negative consequences as not engaging a more social customer. So, the next time you push your associates to interact with customers, consider the potential repercussions. While improved interaction provides plenty of benefits, don’t be blind to the potential negative effects. Don’t confuse improved with increased.

All of which underscore the importance of knowing your customer really, really well. Because if you’ve got a little black cat as a customer, the last thing you want to be is an over-attentive skunk.

by Jennifer Bosavage

Three Cool Mobile Apps Consumers Will Use in 2015

As mobile shopping continues to grow — 60 percent of Amazon’s holiday traffic originated from mobile devices, for example — customers are going to start demanding ways to streamline the experience. Today, it’s a treat to find a retailer who has integrated inventory online with its brick and mortar counterpart. And e-commerce sites that offer in-store pickup are also a shopper’s dream. In the coming year, however, those options will slowly but surely become must-haves for retailers hoping to increase their piece of the pie. Here’s a look at three apps that are worth paying attention to in the coming months.

Mobile apps and shopping sites offer a great deal of convenience to consumers, but retailers should keep the customer experience in mind when implementing their mobile options.

Mobile apps and shopping sites offer a great deal of convenience to consumers, but retailers should keep the customer experience in mind when implementing their mobile options.

Curbside

The Curbside app works with a number of retailers in the San Francisco area, including Target, Macy’s, Sears and Gamestop. (Sears offers “In-Vehicle Pickup” at other stores as part of its Shop Your Way loyalty program.) The customer can search for and buy products from local stores that can be picked up the same day. The user can search across multiple retailers and locations, and check out with one tap. At some stores, curbside pickup is available; at others the order is awaiting customer pickup. If successful, this could usher in a new wave of customers, particularly those with small children who may otherwise find it inconvenient to run errands with kids in tow. In addition, Curbside has introduced “Handoff,” which lets one person create the Curbside pickup, and invite someone else to pick it up.

Postmates

Postmates is Uber for deliveries. Users place an order from a restaurant or store and are matched with a Postdates courier. The courier retrieves and delivers the order in under an hour. Couriers go through a background check and must be customer-service savvy. They can earn $25/hour and work either part or full time. For users, pricing starts at $5 and is determined based on the distance of delivery. Furthermore, it doesn’t matter if the business offers delivery, Postmates handles it independently.

Instacart

Many parts of the United Statesre served by grocery chains’ online delivery service. In the Northeast, for example, it’s Peapod, owned by Stop and Shop. While Instacart delivers groceries, it provides the service to different chains, so a shopper could use the app for Whole Foods on Monday and, if you’re in Philly, Reading Terminal Market on Saturday. The great advantage is the variety of stores offered by the service. Retailers do not need to set their own logistics, freeing themselves up to concentrate on their core business rather than on delivery vans.

Mobile will only continue to grow in 2015, as customers look to employ apps that will help them be more productive and efficient shoppers.

 

by Retail Pro

Steps toward more prolific ecommerce performances

The ecommerce revolution is in full effect, with a breadth of new businesses – especially retailers and professional service providers – launching operations in entirely digital environments to reduce overhead and drive financial performances higher. Although the recent resurgence in the United States economy has presented business leaders with a wealth of new opportunities and far more preferable conditions than any time since the recession, it has also lead to increased market saturation.

As a result, ecommerce retailers need to find ways to separate themselves from the competition and drive visibility in crowded markets, and this can be achieved through the use of the right targeted marketing efforts. By thinking out of the box and never allowing the firm to take a cookie-cutter approach to brand management, this can certainly be achieved in a comfortable fashion. 

Simple steps toward greener pastures
Forbes recently listed several tips for ecommerce retailers who want to add a little spice to their marketing communications, affirming that the first step is to try and identify the context of these pursuits and build comprehension throughout the strategy using these insights. Sometimes marketers will fall into a trap in which they are reciting certain communications constantly and losing sight of what it all means. 

By staying focused and on target, this issue – which can quickly reduce customer engagement – can be adequately mitigated. According to the news provider, retailers should always be looking to their customers – both prospects and loyal consumers – for guidance on how their marketing communications should sound and be delivered. This takes the guesswork out of strategic oversight and fills it in with more accurate and effective activities, bolstering the positive impact of advertising investments over time. 

Furthermore, the source noted that ecommerce retailers might want to expand the number of languages available on their websites to ensure that all prospective customers can understand them in their native tongues. 

Other recommendations
One of the most critical aspects of online marketing is the differentiation of a firm's communications and brand from others in the field, and this will only be achieved when leaders take a highly unique and guided approach to strategic oversight. Get employees in various departments involved in the planning stages, and work to align communications and brand management tasks with specific missions, objectives and values of the business.

by Jennifer Bosavage

Christmas Present And Future

The Christmas holiday season has come to a close

And next comes the question we just have to pose:

For you, dear retailer, was it a success —

Or was it plain and simply a mess?Retailers are cautious of slim Christmas sales.

 

Was your POS system mobile and free —

Or were customers driven right up a tree?

Were inventories in sync online and in-store —

Or were items missing, to be found never more?

 

Indeed, RFID holds such great promise,

But never found its way onto your to-do list.

Clienteling and customization are all the rage

However, you never got on the same page.

 

And yet, dear retailer, please don’t despair.

Not everyone had iBeacon covering their lair.

Tomorrow’s the start of holiday planning ’15

And you can become a lean, mean, retail machine!

 What’s your plan for 2015? Tell us in the comments below.

 

by Jennifer Bosavage

Keeping High Rollers Happy With Loyalty Rewards

In the old days, the general store knew each of its customers by name, and even offered house accounts as a convenience for customers. Although those accounts were kept on handwritten ledgers, it was really the humble beginnings of the loyalty clubs we know today: Because you shop here regularly, we will allow you to run a monthly tab.

From club memberships to mobile apps, merchants encourage customers to return by offering them incentives like discounts or gifts in exchange for their loyalty.

From club memberships to mobile apps, merchants encourage customers to return by offering them incentives like discounts or gifts in exchange for their loyalty.

As a result, shopkeepers got to know their customers. Today’s loyalty clubs offer that advantage as well as, hopefully, a few more perks for customers. Retailers that capture data regarding past shopping history can use that information to reinforce that customer behavior — “Come back to Joe’s when you need paper clips again” — but it does little to extend revenue. The report, “Customer Lifecycle Engagement: Imperatives for Midsize-to-Large Companies,” reveals that marketers think they know their customers well: 53 percent of respondents said they have an excellent understanding of customers’ purchase history, followed by 42 percent for basic demographic information such as gender and age. However, the reported concluded that they lack the deep data insights that would enable them to send personalized, relevant campaigns. Less than 25 percent of marketers are using channel-preference data, propensity scores or household composition. Such often-overlooked pieces of data will reap results, because of their inherit value and because competitors are unlikely to be considering that information.

Loyalty data of past behavior is valuable because when the correct analysis is applied, it becomes predictive — and that’s where retailers will really profit.

While some retailers are stingy with what they offer customers in return for personal data — a strategy that, ultimately, will be unsuccessful — beware of giving away too much in an attempt to improve loyalty. A study by the Harvard Business Review revealed that offering too many perks or services can be unproductive.

Authors Louise O’Brien and Charles Jones in, “Do Rewards Really Create Loyalty?” note that small businesses have traditionally compensated loyal customers with free or bonus items. But as companies grew, it became harder to tell which customers were being loyal as well as the most valuable to keep:

“Rewards programs are widely misunderstood and often misapplied. When it comes to design and implementation, too many companies treat rewards as short-term promotional giveaways or specials of the month. Approached that way, rewards can create some value by motivating new or existing customers to try a product or service. But until they are designed to build loyalty, they will return at best a small fraction of their potential value.”

There is a difference between the loyal customer who comes in monthly and spends $50 and the one who spends $500. Both are loyal, and both are probably worth rewarding, but the customer spending more would probably enjoy (and respond favorably to) receiving a unique promotion. Most companies treat all customers as equals: Everyone gets a 10% off coupon. Those VIP customers are quick to pick up on this and if they aren’t made to feel special, they are likely to find appreciation in the arms of your competitors.

O’Brien and Jones note, “A company that offers average-value products and services to everyone wastes resources in over-satisfying less profitable customers while under-satisfying the more valuable loyal customers. The outcome is predictable. Highly profitable customers with higher expectations and more attractive choices defect, and less desirable customers stay around, diluting the company’s profits.”

What are you doing to keep your high-rollers happy?

by Jennifer Bosavage

Clienteling Helps With All Those Returns

 

 

The holidays will soon be over — and with that comes all those returns.

Surely someone wants that luxurious mint green cashmere Armani sweater, violet Diane Von Furstenberg wrap dress or deep orange Prada bag, just not the first owner.

So back it comes.

As a retailer, you are trying to make way for Spring fashions, and as delightful as these items are, they are just not a fit for this time of year.

You need to move them, pronto.

However, mark downs can make items seem “cheap,” and, particularly in luxe goods, perception is everything.

How to get these products into appreciative hands?

Analyze your shopping data and you just might find some happy homes for these “misfit” goods.

The most loyal among your shoppers may be in store for some good deals if you can decipher which customers should be targeted for specific items.

By narrowing down the prime candidates, retailers can clear out merchandise in a way that is much more appealing than throwing it on a clearance table.

That is where clienteleing— the art of tailoring of a sales message to a particular customer or segment — excels.

Luxury shoppers in particular respond well to a personalized approach, as evidenced by the popularity of the “private shopper” at high-end retailers.

Retailers can start by analyzing their most loyal customers’ information.

What are their shopping habits, and what might entice them to come into the store?

Perhaps a promo code in an email or text message to these valued customers is in order.

Another idea is to compose an email with a personalized URL such as www.JensShoes/CustomerName.

Now you’ve created not just a multi-channel experience but a personalized one to boot. (Excuse the pun.)

Within the email should be some unique information directed at that particular customer.

For example, if a male shopper purchases a similar type item every year at the same time for his wife, the retailer can send him an email with some enticement for him to return.

Or, a phone call from the lead sales associate can work wonders.

Technology sometimes seems at odds with old-school ways; thinking of associates armed with tablets in a general store with its neighborly ways seemingly offers an anachronistic view of the retail experience.

But not really; by embracing technology, retailers can nurture an atmosphere of familiarity, one where everybody knows your name — and your shoe size.

 

by Retail Pro

Lessons in agile, responsive retail marketing

The consumer landscape has been in a state of perpetual flux for several years now, driven by an ever-younger population of individuals becoming the most important purchasers in the United States. Additionally, new technologies have quickly transformed the requirements associated with retail management and the best practices of customer prospect targeting, conversion and retention in a relatively short period of time. 

The most successful retailers of the future will be those that handle the ebb and flow of consumer preference evolution in stride, focusing on agile strategies that adapt whenever necessary. This is no easy pursuit, but a little guidance, a lot of internal research and plenty of healthy technological provisioning can help companies reach and retain a higher volume of prospects in the coming years, leading to increased financial performances. 

Perfection in practice
The Drum recently reached out to several marketing directors, professionals and experts regarding their sentiments on agile advertising strategies, affirming that adaptation is among the most critical actions in this regard. Once a business begins to lose its relevance in the current market, significant issues will inevitably manifest into reality, such as a lack of prospect conversions and hindered retention of otherwise loyal customers. 

According to the news provider, one of the main drivers of an agile retail marketing strategy is adequate and consistent research, working to identify trends as they proliferate – or even before – rather than only obliging the evolutions in a reactive fashion. When it comes to virtually any type of business strategy, proactive companies will almost always outperform reactive ones, regardless of which industry one might be discussing. 

Analysis of available data will often indicate what needs to be done to improve the marketing strategy in stride. 

"We know that we need to engage across multiple channels," Web-based retailer Big Lots Director of Marketing Strategy Brandi Ply told The Drum. "This holiday season we have increased our focus on social and digital media, including creating an online only holiday gift guide, multiple social sweepstakes across Facebook, Twitter and Instagram, creating video content specifically for YouTube, and pushing content on Pinterest for the first time."

The source went on to note that beyond agility, marketing programs must be optimally integrated to ensure a consistent brand image across channels and among customers to be truly successful. 

Takeaways for digital retailers
Online businesses have unique opportunities to create more cohesion throughout the market research, lead generation, advertising, sales and client relationship management cycle, especially as so many consumers are looking to the World Wide Web to connect with companies. For this reason, the focus in 2015 should be establishing a seamless strategy that links each investment into one organic system of brand management. 

When online retailers can strike the right chord in marketing, sales and client relationship management, the sky will be the limit for revenue and visibility growth, while customers will inherently enjoy a more preferable experience over time. 

by Retail Pro

Is social media helping or hindering retail marketing?

Although social media has among the lowest conversion rates in retail marketing strategies, it is a critically important framework of communications with respect to brand management and customer engagement. When a retailer sets up social media accounts and begins to ignore activity stemming from consumers, the chances of reaching and sustaining a positive level of brand recognition will be relatively low. 

On the other hand, firms that proactively and comprehensively manage their social media marketing and branding efforts will enjoy a significant pool of opportunity within these channels and platforms. The trick is to leverage social media investments and activities to the best of their ability, not allowing leaders to try and fit a square peg in a round hole for too long and guiding staff members through their relevant responsibilities through education and training. 

Where is social heading?
International Data Corporation recently released a study regarding the transformation of social media pursuits among businesses looking forward to 2015, affirming that changes are sitting right on the horizon with respect to the best practices of measurement and analysis. As a note, one of the more critical aspects of marketing, regardless of which method is being used at one time or another, is the consistent measurement of performances. 

Notably, the analysts believe that one of the main opportunities that will emerge in 2015 is the ability to build and sustain a strong following at relatively early stages of business ownership. For example, they stated that the total value of online communities specifically targeted at supporting innovation throughout various departments will increase by 30 percent between 2014 and 2015, tacking on another $200 million. 

Companies looking to go social in the new year will also want to strive for integration of various investments and pursuits into one consistent and efficient initiative. 

"The basic building blocks of social business, content, and community are still creating opportunity for change and disruption, but the picture of how and in what business areas is much clearer today," IDC Software Business Solutions Group Vice President Michael Fauscette explained. "The other thing that is clear, although certainly a point of contention for many, is the business value of these new solutions and the general shift to digital."

Looking internally and outside
Social media can provide decision-makers with a wealth of information from the people who matter the most – employees and consumers – more efficiently and quickly than virtually any other platform has offered. When policies and strategies are aligned with specific corporate objectives, investment in various social media pursuits will be more likely to come back with high returns and substantial operational improvements. 

Retailers looking to truly carve out a segment of their market to achieve and sustain revenue growth through the use of social media should also remember that the tools might work best when acting as a glue that holds other pursuits together. The successful combination of social media, content and email marketing, among other platforms, will inherently yield a more consistent brand image. 

by Jennifer Bosavage

So a Millennial Walks Into a Store…

Yesterday, I wrote about the unique perspective the Millennial generation as a whole brings to retail. This group is the first generation to grow up with a computer in their homes, in their schools, and in their pockets — if you count smartphones’ computing power. But I decided this morning to do a little of my own (very limited) research with a Millennial I’m fond of: my son.

Millennials are beginning to gain ground as young professionals, which means that they're a group with disposable income that the retail industry is very interested to engage.

Think you know Millennials? How they perceive retail and shopping for things may surprise you.

Understand, he is at the young end of the generational span. Born in 1997, he will turn 17 on Sunday. He is like many other young men his age: He has a part time job, will have his license in less than two weeks (we hope) and is a strong student. He’s personable and affable, while at the same time successful at being self-centered in the way most teenagers are. Contrary to recent research on members of this generation, he is brand conscious, and, frankly, fussy. Patagonia, Timberland and L.L. Bean have a place in his closet. He’s athletic. He texts and chats with friends in Google hangouts. He’s pretty typical.

So I asked him on the ride to school, “Hey,  if you were going to buy something substantial, like a television set, for your sister, for Christmas, how would you go about doing it?” I really thought I was going to hear a diatribe on why she shouldn’t get a TV, why wasn’t he getting one, etc., but he seemed to understand this was a hypothetical and played along nicely. He said: “I’d go to a store, like a Best Buy, and talk to the guy there. Then I’d go home and look up what he told me. I’d look at the reviews and make a decision.”

I asked him where he thought he’d ultimately buy it. He wasn’t sure, but leaned toward going back to Best Buy, depending on what his research turned up. I also wondered why he didn’t start his research online. He responded, “I want to touch it and try it out. I want to talk with someone who knows what he is talking about.”

Nothing trumps the ability to physically see a product. Whether the customer is 17 or 77, customers want to “test-drive” when possible. And, think about it, wading through dozens of products, reviews and images is time consuming. We GenXers and Baby Boomers remember the days of visiting six or seven stores to get pricing and product information; so the ability to look up all that data online is seen by us as a huge time savings. Millennials have no such frame of reference. They’ve never been driven around town on a hot summer day with no air conditioning to see if that 18-inch RCA was on sale at “just one more place.”

So, rather than spend time researching online, people like my son will simply pick the brains of a retail “expert.” A 15-minute chat with a knowledgeable associate is likely to yield as much information as sitting in front of the computer for an hour. Plus, the customer gets to touch and feel the product in question. It’s a quick, efficient method for getting everything accomplished in a rather social manner.

Brick and mortars are in a unique position to cast themselves in the role of trusted advisor or product expert. By investing in merchandise training for associates, a retailer becomes known as “the” place to shop for particular items. Couple that with modern, customer-facing technology — such as mobile point of sale, RFID and personalized loyalty programs — and retailers have a recipe for success. Even with Millennials like my son.

by Jennifer Bosavage

Bringing E-Commerce Features to the Storefront

One of the most interesting observations about the retail sector over the recent past is the adaptation of online features at brick-and-mortar stores. Only two years ago, it seems, retailers were anxious about holiday receipts due to the practice of showrooming, and the social capabilities of online shopping seemed to threaten brick and mortar sales. But then, it seemed to click (excuse the pun): What is more social than going out and physically being seen? Price matching is as old as retailing itself. And nothing beats experiencing a product before buying it. Put the best feature of e-commerce — its ability to be everywhere at once — to work in a brick and mortar, and you’ve created an enormous competitive advantage.

A great example of that trend is the newest UGG footwear store that opened this month outside of Washington, D.C. Deckers Brands, which owns the brand, has opened one other, similar “UGG Innovation Lab” in Santa Barbara, CA. Like that location, the Tysons Corner, Va., store uses technology to create a customized, customer-centric atmosphere.

“Omni-Channel isn’t just a catchphrase for Deckers; it’s an integral part of our culture of innovation and our retail strategy – one that we’ve made investments in for more than five years now – to engage with our consumers with respect to their preferred shopping channel” said Dave Powers, president of omni-channel for Deckers Brands, in a release. “That strategy is on full display at the UGG store, where we are merging the best of digital and physical shopping experiences, and setting the foundation for future Omni capabilities across our brands.”

By integrating online features into the in-store experience, shoppers can make selections from almost 230,000 SKUs. But if a custoUGGmer just can’t find that perfect pair, UGGs offers customization. The “UGG By You” program gives buyers control of the design process to make their mark on five classic UGG styles. And for those fancying a bolder approach, the “Bling it on Program” lets customers use Swarovski crystals to personalize their looks. In addition, the store has installed technology that reports on products that are tried on, and offers feedback to the consumer on suggested additional products. That’s very similar to an e-commerce site’s “Recommended for You” or “Shoppers Who Have Bought This Item Also Like…”

To enable that, Deckers is implementing radio-frequency identification (RFID) technology that lets shoppers who are trying on merchandise to view digitally triggered content on four 65-inch HD touchscreens throughout the store. That content comprises product information and options, style tips, videos, related marketing campaigns, and suggested complementary products. Shoppers can send themselves SMS texts with a product link directly from the HD screens.

Of course, customer associates are out from behind the cash
wrap, using handheld devices to search inventory, answer customer questions and finalize sales as well. But these days, that’s old hat at many specialty retailers, which took the cue from the Apple Store.

Whether you are a retailer specializing in products from footware or home goods, keeping tabs on inventory is mission critical. Technology can provide retailers with data that initially only was captured by e-commerce stores. Now brick and mortars can know who’s trying on what, how long they engage with the product before purchasing (or not) and can make suggestions for add-on sales before the shopper even reaches an associate.

Retail Pro offers retailers a highly competitive solution that helps track inventory. In addition, our software can be used to monitor fast-selling products, keep tabs on slow sellers and otherwise help their purchasing decisions — something that’s vital in today’s borderless e-conomy.