Posts Tagged ‘retail marketing’

The One and Only Question Facing Sears

Tuesday, January 3rd, 2012

By Doug Stephens

Amid the sounds of tearing gift wrap and popping champagne corks, ailing giant Sears Holdings Corp. announced over the holidays its intent to close as many as 120 stores.  This of course, came as little surprise to the industry that has witnessed the slow motion train wreck that Sears has become over the last several years.  The company has desperately been throwing a variety of ideas against the wall in the hope that something sticks.  So, far nothing has.

Yesterday Bloomberg news quoted Sears Chief Executive Officer Lou D’Ambrosio as saying that a combination of more technology and physical store improvements would help to put the retailer back on track and that Sears has to get better at delivering what its customers want across multiple platforms.  Mr. D’Ambrosio by the way, came to Sear’s by way of companies like Avaya and IBM, so he’s clearly no lightweight in discussions around technology.

Few would argue with the idea that Sears lags technologically or that its stores are dingy and dilapidated.   Even fewer would dispute the truth that Sears has to execute across multiple channels to be successful – that’s just table-stakes in today’s industry.

When tactics are mistaken for strategy

The problem I have with Lou D’Ambrosio’s thinking is that I believe Sears real problems are far more fundamental and critical.  In fact, I would argue that both the lagging technology and shoddy store conditions at Sears stores are symptoms of a far more deadly syndrome and one that goes to the very root of the company.  In my opinion what’s killing Sears is a complete and utter lack of clear and forward-looking vision.  No one has created a cogently articulated picture of what the Sears of the future looks like.  No one has made a promise to consumers about delivering something remarkable or uniquely valuable.

It’s a classic example of a business mistaking tactics for strategy.  Last year the “strategy” was licensing store space to Sear’s vendors.  This year it’s renovations and technology.  Who knows what will it be next week, month or year.   Certainly not the store staffer responsible for representing the brand to the consumer.  And therein lies the problem.  Sears has lost all sense of brand essence and purpose.

The one and only question

Frankly, there’s  only one question that the leadership at Sears needs to answer.  “What can Sears offer the world that the world can’t get somewhere else?”  The answer to that one question becomes the cornerstone for the entire strategy going forward. It becomes the prime occupation of every Sears employee – from Mr. D’Ambrosio down.  The answer to that question is all that matters.

If the answer is “nothing”, then there’s no technology or store renovation plan on earth that will save Sears.

 

 

 

 

 

 

The Declining Need for and Escalating Value of Human Service

Sunday, September 18th, 2011

By Doug Stephens

Technology has been steadily reducing the number of human service interactions we require in an average day. For at least the last decade, the list of what we as consumers can do for ourselves is growing rapidly.   Between kiosks, web based solutions and mobile apps, most routine customer service functions (product knowledge, price checks, inventory inquiries etc.) are now completely do-it-yourself.

With this “self-serve revolution” in place, it’s easy to regard human, person-to-person service as a somewhat archaic commodity for which the market value must be dropping.  I’ve actually heard retail executives say as much, inferring that customer service people have become merely low value cogs in the machine.  Not only do I completely disagree, but I’d go so far as to say that any company that adopts this attitude is making a colossal and potentially fatal mistake.

There’s no app for empathy

What technology has done is to automate the most routine and repetitive customer service tasks; the real mind numbing stuff that deserved to be mechanized.  What is hasn’t done (at least not yet) is automate advanced problem solving skills, empathy and likeability.  Hence, customer service as we know it, is evolving to become less about functional skills and more about cognitive reasoning and emotional intelligence – the really hard stuff!

Technology hasn’t lowered the value of personal service, it’s raised it.  As the need for personal, human service declines, its value in circumstances where it is required becomes exponentially higher!  It’s precisely because we can do so much ourselves that when we encounter something we can’t, it’s literally jarring.  Consequently, the stakes are immediately higher.  These are situations where the customer has already reviewed your frequently asked questions board, called your automated help line and read your user’s manual.  They’ve made every attempt to solve their own problem – all to no avail.  The only remaining option is to call an expert who can help.  The human being they call or visit at your business is the last and most vital stopping block between your customer and your competitor’s doorstep.

Moments of Truth

A great example of a company that gets this concept is Zappos. 75% of Zappos sales are transacted without any interference from a human being – all totally systematized.  Most businesses would invest proportionately in the side of the business that generates the majority of sales – the automated 75%.  And yet, Zappos puts incredible emphasis on the hiring, training and compensation of the people who respond to the 25% of sales that do require personal service.  The rationale is simple; the 25% personal sales are regarded as do-or-die moments of truth when the system won’t cut it and when the customer needs the brand to truly perform.  These are the sales that create memorable experiences and word of mouth.  To skimp on talent at these most pivotal circumstances discredits the entire brand.

The best analogy I’ve heard is that the role of the customer service person today is much like that of an airline pilot.  The pilot is not paid to fly the plane – that’s almost completely done by the autopilot system.  Rather, the pilot is paid to be there in the critical moment when the system fails.

Mobile Reality Check

Monday, June 6th, 2011

Many of the headlines we read would have us believe that consumers are running rampant, begging for opportunities to browse, shop and even transact retail purchases on their mobile devices.  While there’s no question that mobile commerce and payment are coming fast, it’s often difficult to gauge precisely how fast.  The answer is critically important for marketers as they wade into mobile marketing initiatives and tactics.

In part 1 of Mobile Reality Check, I’m joined by Gary Schwartz, Founder and CEO of Impact Mobile.

Over the past nine years, Gary has played a leadership role in the mobile industry. He founded Impact Mobile in 2002 running the first cross-carrier short code campaign in North America.

In 2006, Gary founded the mobile committee for the Interactive Advertising Bureau (IAB) and sits as Chair of the Mobile Entertainment Foundation (MEF).

Gary has been involved in mobile marketing from virtually every conceivable angle and is the recipient of the Asia and Japan Foundation Fellowship as well as the Macromedia Peoples’ Choice Award and Dodge Foundation award for innovation. He is also the author of the upcoming book, Click2K’Ching: The Mobile Shopper & The Impulse Economy.

I had an excellent chat with Gary from his offices in Toronto in which he shed light on some of the truths and tall-tales with respect to mobile consumerism.

[youtube]http://www.youtube.com/watch?v=8Ee1DqPLCPQ[/youtube]

PlayBook gets subdued retail launch

Thursday, April 21st, 2011

Via Computerworld

By Matt Hamblen

The Blackberry Playbook Tablet

Nobody expects the BlackBerry PlayBook tablet to sell as well as the iPad 2. Still, Research In Motion seems to have taken an especially measured approach with its PlayBook launch, which started Tuesday in stores such as Best Buy and Radio Shack.

All along, analysts have predicted that RIM would mainly sell the first Wi-Fi-only version direct to business customers, RIM’s traditional base.

Read More

Sony Kicks It Up A Notch

Wednesday, April 20th, 2011

Sony's new concept store

The days of abundant demand and easy sales are over and it appears Sony is facing that music head-on.  The company has not only unveiled it’s new and decidedly cooler store concept in Los Angeles but also closed 11 of it’s older format stores.

RIS News quotes a Sony spokesperson as saying that, the closings were “a result of our ongoing evaluations and careful review of our future direction. Sony continually evaluates all areas of our retail business to ensure that we are offering the best consumer experience while maximizing profitability.”

The re-tooling by Sony is indicative of the broader rethinking that is taking place among the retail community in general as it faces the prospect of a flatter economy and higher consumer expectations.

Does Love Scale?

Tuesday, April 19th, 2011

Image courtesy of the I Love You Blog

This week Wal-Mart announced its purchase of social media firm Kosmix to help it better manage and capitalize on its social and mobile marketing efforts.  What is clear from the announcement is that Wal-Mart recognizes the unrelenting shift to social and mobile media as an integral component of doing business and is literally buying in.  What is less clear but inferred in the move is that Wal-Mart also understands the challenges involved in scaling the real-time, personal interactions that positive social business demands across such a mammoth organization.  While Wal-Mart won’t be the first large company to engage in social media, it is nonetheless, the largest retailer on earth.

And so, that leads me to ask the questions: Can social media really be scaled beyond a certain point before it becomes mass media in disguise? Does an abundance of structure and protocols, undermine the spirit of a conversation in the first place?  Does social media lose its sense of intimacy if we feel that it’s been manufactured through an enormous infrastructure of contractors and systems?

To be honest, I don’t really have an answer to this but would be interested to hear if others think genuine and meaningful social interaction be achieved on a massive scale.

What do you think?

Death of the Focus Group: Research Meets Mobility

Saturday, February 5th, 2011

By Doug Stephens

I sat on a panel discussion this week that explored how social and mobile media is changing the way customer feedback is collected, analyzed and acted upon by retailers. One specific question asked how mobile devices can be used in a retail environment to facilitate better customer feedback or improve responsiveness to complaints. Within the context of this discussion, the idea was to comment on how mobile is being used as a customer service channel but it occurred to me that there’s a much more important data track.  One  that provides a completely new and revolutionary opportunity for marketers.

Say versus Do

First, one has to appreciate the historic problem with consumer research and the challenge it’s always posed for retail marketers.  Consumer research often attempts to predict future consumer behavior but the reality is that consumers very often say things that don’t correspond at all to what they eventually do in store.  In fact, there’s often a gaping disconnect between a consumer’s needs as articulated in focus groups and the basket of stuff that gets taken home from the store.  If the two matched up even the least bit closely, marketing would be a cinch but they often don’t and with good reason – consumers rarely have a clue why they do what they do in stores!  And in other cases, focus group participants simply don’t tell the truth, which probably doesn’t come as any great shock.

Data, data everywhere…

One thing is for sure, the problem with consumer and shopper research isn’t born out of a lack of data.  We’ve got  a plethora of information on both ends of the shopping spectrum, loads of focus groups, surveys and intercepts to gauge needs on the front end and a steady flow of point of sale data to analyze purchases on the back end.  What have been missing are the critical insights in the middle – what shoppers actually do in the store!  This has largely been the realm of anecdotal data and lab-based studies, both of which are often highly inaccurate.

Every move you make

That’s where I believe mobile apps, near field communication, location based services and other intelligent retail technologies are poised to revolutionize our approach to consumer and shopper research.  For the first time ever, researchers will be able to connect the expressed needs of consumers with their actual, physical path to purchase.  Questions like where they go in the store and where don’t they go, where they stop and what they race right by will finally be precisely answerable.  We’ll have visibility into the specific events that trigger a customer to abandon their visit or buy more than usual.  We’ll see more clearly what occurrences precede a complaint.  We’ll even have the potential to see where they’ve come from and where they go after leaving the store.  And what’s critical is that marketers can view this kind of information in aggregate according to what thousands of consumers do, not simply within a narrow and controlled study group.

But understanding the consumer’s physical path is only one of the new streams of data.  The other and more important stream will reveal what they actually engaged and interacted with in the space.  Which in-store marketing messages did they connect with and for how long, which coupons did they download, which products did they scan but put back without buying?  Marketers will see where consumers required more or less information to make a decision and perhaps even when they compared prices with competitors before deciding.  Even insights on how different ages, sexes and races move through a given retail environment are entirely possible.

Finally marketers can validate the reams of data they currently collect with credible information on the consumer’s actual in-store behavior.  This presents a whole new world of opportunity to give retail consumers what they want – potentially without ever once asking them.  It’s also chance to better understand the gap between what consumers say and what they do.

In fact, it’s entirely possible that this new ability to validate in-store consumer behavior will render front and back end consumer surveys a thing of the past.

The Customer in Control: Mobile Self-Check Out

Saturday, January 15th, 2011

One of the hottest topics at the 2011 National Retail Federation Conference was that consumers are increasingly using brick and mortar stores as mere showrooms to view products before buying online.  Furthermore, in a growing percentage of cases, these online purchases are being made right from the aisle of the physical store.

In this segment we highlight AisleBuyer, a new mobile application that not only gives customers the power of mobile scanning, browsing and self-checkout but also allows retailers a degree of control over the shopping experience, working to keep the consumer and the sale in the store.

[youtube]http://www.youtube.com/watch?v=FVEMSzcS8mg[/youtube]

The Shortest Ever Guide To Success In Specialty Retail

Friday, November 19th, 2010

By Doug Stephens

Chapter 1

Here’s the way it is…

Any specialty retail business that stands on selection, price or convenience as its point of competitive differentiation will be toast… if not today then very soon.

Between Amazon, Facebook Marketplace, EBay ,Google Boutiques, Wal Mart and a host of others, the price, convenience and selection markets are cornered.  And they’re already scaled beyond the point where you could ever dream of catching up so throw away any notions you have about trying.  It’s a fight you can’t win.  And frankly if you think you’re winning at it, you’re losing.

Here’s what’s left for you to compete on – service, shopping experience and product quality.  Choose at least one of these and dominate in it.

But by dominate, I don’t just mean be good at it.

I mean be extraordinary.  Be remarkable to the point where you become famous for it. Hire it.  Train it.  Instil it in your people and reward them when they do it.  Communicate it at every marketing touch point.  Get so good at it other businesses come to you to learn how to do it.  Treat it like a religion.  Write a book on it.  Be so ridiculously excellent at it that no competitor would bother trying to beat you at it.  Put it on a T-shirt.  Be it! Own it! Tweet it! Crush it! Live it!

Now, just do this every day and you’ll be successful.

Chapter 2

(Re-read Chapter 1)

Holiday Retail Sales: Why Prognostication Breeds Procrastination

Monday, October 11th, 2010

By Doug Stephens

It’s that time of year again…prognostication time.  The time when retail industry experts far and wide weigh in with their respective projections for sales for the upcoming holiday season.  For my part, I’m sitting this one out.

I’ve resolved to stay silent this year, largely because I don’t think it really matters what incremental difference we see in sales performance this year versus last.   And I don’t say that lightly, because I recognize fully that the livelihoods of countless retail workers hang in the balance.  What I mean is this; I don’t think sales being up, down or sideways has any bearing on the deeper realities this industry is confronting.  Would a 0.3 percent year on year lift have prevented Blockbuster’s demise?  Would a better than expected quarter have helped Borders…or Linens n’ Things?  Would a slight rise in sales have saved the recording industry? Probably not.

In fact, a strong-ish holiday season may only serve to cover up the cracks in the foundation.  I will go so far as to say that anything that approximates good news might actually encourage many retailers to procrastinate in their efforts to prepare for the future – a very different looking future.

We are sitting on the fault line of seismic shifts in media, consumerism, global economics, technology and demographics.  And not only is change a reality, it’s also taking place faster than many businesses can keep pace with.  The shifts that are happening today will long outlast the current economic ice-age.

Some might say that this is a revolution you either lead or die in.  I prefer the glass half-full view – that these changes hold incredible opportunities for retailers who are willing to understand and act on them now. But that can only happen once you question your current business model and value proposition; once the tension for change sets in.  And as long as the intravenous drip of incremental sales improvement continues, too many retailers will remain satisfied clinging to life.

I’d rather be a proponent of change than mere survival.