Excavating Problems at Anthropologie

The Washington Post: It’s hard not to see the parallels between what’s ailing J. Crew and what’s ailing Anthropologie: Both chains are simply failing to offer shoppers the kind of clothes they are looking for. And while it was easy at first to write off Anthropologie’s stumbles as a temporary blip, a full year of unattractive merchandise in dresses — one of the chain’s most essential categories — raises questions about whether it might be slipping into a rut.”

“It’s not all bad news for Anthropologie: The company said that sales of home products, beauty products, accessories and shoes were strong in the latest quarter.” CEO Richard Hayne “told investors he is so bullish Anthropologie’s potential as a home goods retailer that he said he could foresee a future in which clothing accounts for less than 50 percent of the store’s sales. If the store can pull off that change in the mix of the business, it may not matter so much if the apparel category goes through a soft patch.”

“And the retailer seemed to suggest that it is going to be more focused on building an international growth strategy this year, a move that could provide it with a fresh stream of sales growth.”

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A Revolution in Toothbrush Design

Gizmodo: “Researchers at the Fraunhofer Institute have developed a virtual brushing simulator that promises to revolutionize how toothbrushes are designed and tested … The size, shape, and elasticity of a toothbrush’s bristles can be precisely modified and tested in the simulator, but so can the size, shape, and quantity of the abrasive particles in a toothpaste.”

“Highly controlled experiments can be conducted in the simulator allowing toothbrush designers to almost instantly determine how effective a new bristle design is at removing dirt while still preserving tooth enamel … So in the future when a commercial for a new toothbrush promises it to be effective at battling plaque and gingivitis, hopefully its creators will be able to show the simulated results backing up their claims before you make the upgrade.”

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The Beatings Will Continue Until Morale Improves

“Gary Friedman, head of Restoration Hardware Holdings Inc., painted a dire picture of the furniture chain in an internal memo to employees, comparing its operations to a burning building with people on fire,” Bloomberg Business reports.

“Upset about customer service and late orders, Friedman fired off the message to the entire organization in late January … ‘We were sitting there discussing how the building caught on fire, why the building caught on fire, how long we expected the building to continue burning,’ he said in the memo … ‘NO ONE WAS FOCUSED ON THE PEOPLE IN THE BUILDING WHO WERE ON FIRE. THEIR CLOTHES BURNING, AND MANY OF THEM DYING. WE HAVE LET CUSTOMERS DIE.'”

“’We need a MASSIVE CHANGE IN OUR CULTURE AND ATTITUDE RIGHT NOW,’” Friedman said in the message, which was replete with capital letters. “THE GOAL IS DELIGHT … YOU WILL NEVER GET IN TROUBLE FOR MAKING A DECISION TO DELIGHT OUR CUSTOMERS. YOU WILL, HOWEVER, LOSE YOUR JOB IF YOU DON’T.”

Explaining the memo in an interview, Friedman said: “It’s empowering people in the organization,” he said. “We have a leadership culture, not a followship culture.”

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Bluetooth Can Be a Driving Headache

“The road to the autonomous future, it seems, is not as smooth as it appears,” The New York Times reports. “Problems related to cars’ rapidly advancing technology are now at the top of the list of consumer complaints, according to the 2016 J. D. Power Vehicle Dependability Study.”

“The biggest issues are balky voice recognition systems and problems with Bluetooth pairing, accounting for 20 percent of all customer complaints. Over all, the discontent drove a 3 percent decline in vehicle dependability in the study … Complaints about technology have gone from being fifth most troublesome in the 2014 study, to third last year, to now being first.”

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Customer Service Declines When The Economy Improves

Quartz: “Consumers are more unhappy with customer service at department and discount stores than ever. According to the University of Michigan’s American Customer Satisfaction Index, satisfaction is at its lowest level since 2008, falling during the last year by 3.8%. Consumers are griping about store cleanliness and slow checkout lines, specifically.”

“Of the bigger companies, the steepest decline in satisfaction—an 8% drop—went to Macy’s … While an improving housing market increased competition between Lowe’s and Home Depot, both groups saw drops of 9% and 4%, respectively. Among supermarkets, Whole Foods took a 10% hit, knocking its ranking below Trader Joe’s, Kroger and Meijer.”

“The relatively buoyant economy is partly to blame. After 2008, competition for consumer dollars intensified, prompting discounts and better service. Employees fearful of losing their jobs stayed motivated to work hard pleasing shoppers. Then, things got better.”

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Loyalty Is a Two-Way Street at Starbucks

What defines loyalty in the customer-brand relationship? Until this week, Starbucks defined it as the number of times the customer bought a cup of coffee; buy 12 cups and you get one for free. The retailer has now re-defined loyalty as the amount of money spent. This has caused upset among some of its “loyal” customers, who now must purchase 32 cups of coffee to get that free cup. Starbucks apparently was inspired by certain airlines — Delta and United — that now award loyalty points based on the amount of dollars spent, and not on the number of miles traveled. This might telegraph as: We want your money but we don’t want you.

The Starbucks switch was at least partly motivated by profits; obviously it is more profitable to motivate its most profitable customers. However, it also suggests a change in culture. As reported in The New York Times, the Starbucks loyalty program previously was premised on a warmer, fuzzier idea, as articulated by a Starbucks marketing manager in a 2012 blog post: “At Starbucks, our rewards program comes from a different philosophy. At its simplest, we like seeing you, regardless of whether your purchase is a short-brewed coffee or four Venti White Chocolate Mochas. My Starbucks Rewards is designed to show our appreciation simply for stopping by.”

This would be consistent with the way Starbucks famously welcomes everyone to hang out as long as they like at their stores, even if they buy nothing at all. Sadly, such “customers” are the poor cousins of those who gamed the Starbucks loyalty program by asking cashiers to ring up each item separately to artificially inflate their number of visits. This subterfuge also caused lines to slow, making the Starbucks experience worse for everyone else.

The Starbucks-customer relationship in total calls into question the very meaning of “loyalty,” and whether it even exists in a commercial context. As the Times article notes: “Starbucks fell into a trap that is common with loyalty programs: establishing not just an exchange relationship with its customers based on mutual benefit, but a communal relationship based on mutual caring and support … If customers are going to take a ‘hey, it’s just business’ approach to their relationship with Starbucks, they should expect the company to do the same — and it has.”

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Tesco, Apple & The Meaning of ‘Marketing’

Two weekend news stories paint “marketing” in a pejorative shade; one is kind of funny and the other is decidedly not so funny. The lighter story concerns Tesco, the UK supermarket chain, and its decision to stop making crescent-shaped croissants. This is how Harry Jones, Tesco’s croissant buyer, explained the decision in a written statement, cited in The New York Times:

“The majority of shoppers find it easier to spread jam, or their preferred filling, on a straighter shape with a single sweeping motion. With the crescent-shaped croissants, it’s more fiddly, and most people can take up to three attempts to achieve perfect coverage, which increases the potential for accidents involving sticky fingers and tables.” The story concludes by noting that Tesco’s move to twist-free croissants was roundly mocked on Twitter “as a marketing tactic.”

The other story is, of course, the one involving Apple and the Justice Department’s demand for “the technical tools to get inside the phone” to help investigate the mass killings in San Bernardino, California, also reported in The New York Times. In a court filing, prosecutors said Apple’s resistance “appears to be based on its concern for its business model and public brand marketing strategy.”

In Tesco’s defense, it appears the retailer is mainly interested in creating what it believes is a better croissant “experience” for its customers. Call that “marketing” if you want, but it falls squarely within the realm of solving a perceived customer problem. Bravo. The problem is that Tesco is forcing this solution on all of its customers, disenfranchising those who care less about the efficiency of consuming a croissant than the enjoyment of it. For many, this means pulling the damn thing apart bit by bit and making a real mess of it along the way.

As for Apple, it’s clearly a more complicated issue. Without taking sides on the controversy itself, this much is clear: The company should not be denigrated as a “marketer” for trying to keep its brand promise — privacy– to its customers. This isn’t about marketing to its customers; it’s about being true to them. The Times article also makes this key point:

“Apple has taken a strong stand on privacy … because the company’s business model encourages a bolder stance. Unlike other Silicon Valley tech giants, Apple’s business has a straightforward hardware model that hinges on selling physical devices like iPhones, iPads and Macs. Other tech companies, including Google, Facebook and Twitter, depend more on the online collection of large amounts of consumer data for their digital advertising-oriented businesses.”

Where others build their businesses on selling their customers’ privacy, Apple’s premise — and promise — is just the opposite. Its privacy policy states: “When we do ask to use your data, it’s to provide you with a better user experience.” You can believe that or not. You can side with Apple or the Justice Department (and again, no position is taken on that here). However, to disparage or dismiss Apple’s stance as just “marketing” demonstrates a fundamental lack of understanding that the ultimate worth of any brand is grounded in the promises it makes and keeps. That’s not just “marketing.” It’s everything. With a little butter and jam on the side, please.

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Some Uber Drivers Are Not Uber Happy

Christian Science Monitor: “Harry Campbell, author of The Rideshare Guy, a popular blog for rideshare drivers, asked his 10,234 e-mail subscribers to rate their experience with Uber. Of the 453 who responded, only 48 percent are happy with their employer.”

“A common perception of the difference between Uber and Lyft is that Lyft is a better company to work for, but Uber brings in higher pay. But Uber’s claim to fame among drivers – that it offers the highest wages in the game – is slowly eroding. To increase business during the slow winter months, Uber recently cut fares for passengers, and thus salaries for drivers, in over 100 cities.”

Some drivers say “weekly expenses like gas, toll fees, insurance and car maintenance detract the company’s impressive averages. In a company report last year, 11 percent of drivers said they actually lost money after being their employment with Uber.”

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Fresh Air: Glade Discloses Ingredients

Huffington Post: SC Johnson is “the first major player in the household chemicals industry to list 100 percent of the ingredients used to create fragrance in one of its lines of scented products, the Glade Fresh Citrus Blossoms collection of wax melts and air fresheners. That includes the chemicals ordinarily glossed over with catch-all phrases like natural ingredients or essential oil.”

“Its goal, in part, is to create a new standard of transparency that would challenge upstart competitors, who sell themselves as greener alternatives, to disclose every single component in their fragrances.”

“It’s important to lay it all out there for the scrutiny of the world what goes into our products if consumers are going to trust us,” says Herbert Fisk Johnson III, the company’s chairman and chief executive. “In the absence of information, people tend to think the worst.”

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The Model ‘X’ Experience: Tesla Bans a Cranky Customer

Elon Musk cancelled an order for a new Tesla after the buyer criticized the Tesla CEO’s handling of “an event designed for customers.” The customer was venture capitalist Stewart Alsop, who complained that he “felt ignored” because he had spent two hours at a Musk-hosted event but never got to see the Tesla Model X he had on order and had been invited to see. “I suppose you think that I left too early at 9:00pm and should have stuck around longer if I really wanted to see the car,” Alsop wrote after being banned.

About Musk banning him as a customer: “I am mostly sorry not to be able to participate in the automobile revolution that Tesla started,” Alsop wrote. “You have created a car company when everybody decided decades ago that it was not possible. You have challenged the hateful and intimidating distribution system that forces people to be subjected to the hard sell even if they just want to buy a car they know they want. You have innovated on user experience, battery technology, autonomous operation, and virtually every other aspect of the automobile experience today. And you designed and produced a really beautiful and amazing car along the way!”

Noting that Tesla “does not have a marketing department,” Alsop suggested “it might be time for the company to take on such a function. At the very least, it might mean that your events start on time and they are designed for the people who are invited to attend.”

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