Retailers Miss Mark With ‘Targeted’ Emails

The Wall Street Journal: “Traditional retailers were once pioneers of using data to zero in on what customers want. But as the importance of their catalogs and mailings have been overtaken by email and other online media, they have struggled—sometimes to the frustration of their customers.”

Brendan Witcher of Forrester comments: “Nearly 90% of organizations say they are focused on personalizing customer experiences, yet only 40% of shoppers say that information they get from retailers is relevant to their tastes and interests. The ugly truth is that most retailers haven’t done the (hard) work of understanding how to use the data.”

“At no time is that more evident than during the year-end shopping bonanza, when retailers deluge customers with messages. During last year’s holiday season, retail emails increased 15% compared with the rest of the year, but shoppers opened 15% fewer of them, according to a study of eight billion messages by marketing-services firm Yes Lifecycle Marketing.”

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Social Media Buzz: Not Always Accurate

The New York Times: “On average, 19 percent of a brand’s sales — or between $7 trillion and $10 trillion in annual consumer spending in the United States — are driven by social conversations, both online and offline, according to a new study conducted by Engagement Labs, a Canadian company that analyzes conversations around brands. The study, which looked at 170 brands, found that companies often wrongly saw social media as an accurate and sufficient guide for tracking consumer sentiment. Often, though, that social conversation might be much different from what people are saying in private conversations with friends and family, the study said.”

Co-author Brad Fay comments: “The danger is you can make some pretty big mistakes if you assume the conversations happening online are also happening offline. Very often, they’re heading in different directions.”

“The most negative and most outrageous comments often get the most traction on social media. And sometimes, people post comments about a topic just to get a reaction or to reflect an ‘image’ or appear ‘cool’ to their social media followers, when their actual views may be the opposite.”

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Casa Barilla & The ‘Fast Pasta’ Trend

The Wall Street Journal: “It’s spaghetti and meatballs like grandma used to make, served in the culinary equivalent of a New York minute. Made-to-order pasta dishes such as fettuccine Alfredo and rigatoni Bolognese are being churned out at the speed of burrito-slinging at Chipotle. Italian food is having its fast-casual moment.”

“Chef Mark Ladner, formerly of Michelin-starred Del Posto, set out to open the McDonald’s of noodles, only healthier, with Pasta Flyer in Greenwich Village. The space, a former Chipotle, has been transformed into a terrestrial-inspired dining room with a hanging UFO and a black-and-white mural of Rome. Mr. Ladner leads the assembly line stirring up sauces for pasta combos such as fusilli with pesto; whole-grain rigatoni in a meat ragout; creamy fettuccine Alfredo; and gluten-free penne. Each are is priced at $7 to $8.”

“An early adopter of the grab-and-go noodle trend was boxed-pasta brand Barilla. Casa Barilla restaurant opened in Midtown in 2013, serving pasta, pizza and salads in a snap. The chain recently expanded to Southern California and to Dubai. Prices range from $7.95 to $12.95.” Restaurant consultant Clark Wolf comments: “This is about better ingredients and better foods in the right portions that happen to be delicious. It was bound to happen. It just had to wait until fear of carbs died down and until Americans learned that there’s more to making pasta than just industrial wheat.”

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Chock Full O’What? Yes We Have No Nuts

The New York Times: “It is almost as familiar a part of New York lore as a taxi or King Kong or the building that he climbed — a can of Chock full o’Nuts coffee. But then it became a New York export. And as the quintessentially recognizable can crossed the Mississippi River in a push to go national, concerns arose about one word on the label that might not play well in Omaha or Oklahoma City — nuts. So Chock full o’Nuts has put what amounts to a giant disclaimer on the can: ‘No nuts’.”

“Do people really think that Chock full o’Nuts cans are chock-full of nuts?Apparently so. Convincing consumers that there are no nuts in Chock full o’Nuts is, well, a tough marketing nut to crack.” Marketing chief Dennis Crawford comments: “Every time we’ve done consumer research on why some people do not purchase the product, the No. 1 thing that comes back to us is there’s something in the coffee. Most of the people in New York — we’ve been there forever and they get it, but if you’re in Omaha and suddenly we’re on the shelf and you see the brand for the first time, there’s confusion.”

“The ‘no nuts’ panel on Chock full o’Nuts cans summarizes the history of Chock full o’Nuts. ‘1920s — we sold nuts. 1930s — we sold nuts and coffee. Now — we don’t sell nuts. We just sell coffee. But we like our name’.”

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The 3 C’s of Retail Revival

Quartz: Ryan Raffaelli of Harvard “studies how mature organizations and industries faced with technological change reinvent themselves. Raffaelli has termed this line of research ‘technology reemergence.’ It began with his study of the Swiss watch industry, which collectively reinvented itself (and thus survived) in the wake of digital watches. Five years ago, he set out to discover how independent bookstores managed to survive and even thrive in spite of Amazon and other online retailers.”

“Here are some of Raffaelli’s key findings so far, based on what he has found to be the ‘3 C’s’ of independent bookselling’s resurgence: community, curation, and convening. Community: Independent booksellers were some of the first to champion the idea of localism; bookstore owners across the nation promoted the idea of consumers supporting their local communities by shopping at neighborhood businesses … Curation: Independent booksellers began to focus on curating inventory that allowed them to provide a more personal and specialized customer experience.”

“Convening: Independent booksellers also started to promote their stores as intellectual centers for convening customers with likeminded interests—offering lectures, book signings, game nights, children’s story times, young adult reading groups, even birthday parties. ‘In fact, some bookstores now host over 500 events a year that bring people together,’ Raffaelli says.” He adds: “The theoretical and managerial lessons we can learn from independent bookstores have implications for a wide array of traditional brick-and-mortar businesses facing technological change.”

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The Un-Store: Can’t Buy Me Gloves

Quartz: “The idea that a brick-and-mortar store would lack actual, purchasable merchandise seems like a gamble … But more retailers are beginning to embrace the ‘un-store,’ which is a retail space that doesn’t actually stock products for sale. By eschewing the traditional sales-based model for one that focuses on customer engagement, product education, and services, the shopping experience becomes less about the bottom line, and more about top-line brand engagement and loyalty-building.”

“When people visit Samsung 837, they’re in a comfortable environment where they can relax without feeling the pressure of a sales associate encouraging them to buy something. They’re therefore free to spend more time learning about the products and interacting with them, which boosts their connection to the brand and their understanding of its wares … those interactions can give the retailer more valuable information than money can buy. For example, they can use the data generated during a store visit to determine if a particular campaign is working, or if there is more interest in a one product versus another.”

“This past October, department-store retailer Nordstrom launched its own un-store concept with Nordstrom Local, a 3,000-square-foot, service-driven space in Los Angeles’ West Hollywood district … Here, the focus is on convenience … they offer services such as personal styling, on-site alterations, in-store pick up, returns, manicures and, of course, coffee, drinks, and wine.”

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Everlane Experiments with Community & Commerce

The Washington Post: Everlane founder Michael Preysman “has spent the past two years experimenting with different types of formats … to find the right approach for Everlane stores. One concept, called Shoe Park, required customers to take off their shoes at the door … Shoppers were encouraged to try on a pair while they grabbed coffee or sipped a cocktail. It turned out to be fun, Preysman said, but not very practical.” He adds: “We turned it into such a playground that at the end of the month, we ended up with all sorts of damaged shoes.”

“Last winter’s ‘Cashmere Cabin,’ a six-week pop-up in New York’s West Village, allowed shoppers to browse sweaters while they drank mulled wine and hot chocolate. Cozy and enjoyable, sure. But a long-term business model? No. Other experiments, which the company called open houses, were built around Everlane’s mission to be as transparent as possible. Evening events showed customers where products were sourced and how they were made but didn’t offer many items for sale. That didn’t work, either, Preysman said.”

“That just confused everybody,” he said. “We learned that while people want experiences, they also want to shop. It’s got to be a mix of both community and commerce.”

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Kosher Cocktails: Man-O-Manischewitz

The New York Times: “At the Upper East Side branch of the Second Avenue Deli, they have matzo ball soup for what ails you. If that doesn’t do the trick, soon you can walk upstairs for something stronger. On Nov. 27, the brothers Jeremy and Josh Lebewohl … plan to open 2nd Floor, a cocktail lounge just above the restaurant, with a separate entrance on East 75th Street. This is fairly uncharted territory for Jewish delicatessens. In 1997, the owners of Ratner’s, the famous kosher dairy restaurant on Delancey Street that is now closed, opened a speakeasy in the back called Lansky Lounge. But delis are usually not associated with sophisticated drinking.”

“The bar will be unusual in that the liquid menu is certified kosher. Also, some ingredients are not ones you’re likely to find at any other cocktail bar in town. Man-O-Manischewitz, a riff on the gin cocktail called the Bramble, uses a syrup made from Manischewitz wine rather than the traditional crème de mûre. The Upper Eastsider, a long drink that can be made with gin or vodka, has Dr. Brown’s Cel-Ray soda as a component. A drink called the Shofar, similar to a Jack Rose, is made up of ingredients whose flavors are associated with Rosh Hashana, including apple brandy, pomegranate (in the form of grenadine) and honey.”

“The space, which seats roughly 100, is designed to look as if it’s been there for years, with wooden floors, club chairs and an old tin ceiling. In the bathroom area, there are framed photos and posters of old Yiddish theater stars, a nod to the deli’s original location in the heart of the now-vanished Yiddish theater district.”

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Shopper Mobs: The Dark Side of ‘Black Friday’

The New York Times: “What turns ordinary shoppers into dangerous mobs? Social scientists and psychologists are trying to find out. Sharron Lennon, a professor in the merchandising program at Indiana University, became interested in studying consumer misbehavior after seeing news reports a few years back about fights breaking out at her local mall … Dr. Lennon speculates that feelings of unfairness drove many of these shoppers to behave the way they did. Shopping and the retail-consumer relationship, she said, is expected to be an equitable exchange of a good for payment. Any violation of the exchange can evoke strong feelings of inequality.”

“When a store failed to properly stock advertised ‘doorbusters,’ when sale prices weren’t honored, such as being denied an early bird discount at checkout even though they were in line before the sale expired, or when they failed to obtain an advertised item or failed to receive the discounts they anticipated, Black Friday shoppers were most likely to misbehave. In a follow-up study, Dr. Lennon … found that those who felt other customers were being ‘unpleasant’ were more likely to feel the store was being unfair — and were more likely to become uncivil themselves.”

“Perceptions of scarcity are also a driving factor in consumer misbehavior, said Bridget Nichols, an associate professor of marketing and sports business at Northern Kentucky University. When consumers feel a product is scarce, they value it more. And Black Friday is designed to offer limited amounts of products for a limited amount of time, thus heightening the sense of urgency, she said … Sharing the Black Friday ritual with friends and family can create a similar sense of tribal bonding, Dr. Nichols said, and reinforce bad behavior.”

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Black Friday Tricks of the Trade

The Wall Street Journal: “Instead of copying Amazon.com Inc.’s playbook, retailers such as Wal-Mart Stores Inc. and Target Corp. are coming up with new tricks to maximize sales ahead of Black Friday … In the months leading up to the holiday, Target has shifted away from ‘up and down’ pricing moves, streamlining the number of promotions to focus only on ‘impactful’ sales … The company has also reduced the phrases it uses for discounts from 28 last year to seven, dropping language like ‘weekly wow’ and ‘as advertised’ … It is also offering extra incentives to its loyalty card holders, such as early access to Black Friday promotions.”

“Wal-Mart, which has long emphasized an ‘everyday low price’ message, has been experimenting with a new online system, which at times results in higher prices online than in stores for goods that would otherwise be unprofitable to ship. Some product listings on its website now indicate an ‘online’ and ‘in the store’ price … The Bentonville, Ark., retailer said it would sell more exclusive products this holiday as compared with last year.”

“For the first time, Best Buy Co. offered hundreds of Black Friday deals on TVs and other devices in early November in hopes of driving sales before the competition heats up. The electronics giant has a price-matching guarantee, but the offer doesn’t apply to items on sale Thanksgiving through Monday.”

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