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.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

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.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Wegmansmania: Bigger than the Beatles?

The Wall Street Journal: “Across the U.S., grand openings of specialty grocery chains such as Whole Foods Market, Stew Leonard’s and Wegmans Food Markets Inc. are attracting customer hordes … By 7 a.m., roughly 2,000 people had swarmed a shopping center in Hanover, N.J., to mark the arrival one Sunday this summer of a Wegmans and its exotic cheeses and hen-of-the-woods mushrooms.” Robin W. Dente, community-affairs coordinator for the township comments: “It reminded me of when the Beatles came to America.”

“Wegmans, which has drawn lines of loyal ‘Wegmaniacs’ to opening days since at least the 1950s, doesn’t give out freebies to woo shoppers at dawn, according to the company.” However: “As part of its multibillion-dollar expansion, the German discount grocer Aldi Inc. is running multiday openings with tastings of chocolate truffles and imported brie—and a chance to win produce for a year.” Meanwhile: Stew Leonard’s, a Connecticut-based chain known for holding Christie Brinkley wine tastings and other celebrity events, has dialed down a bit.”

“Before it entered Long Island last year, it hit local media and attended a village pumpkin festival and other events, handing out 100,000 $5-off coupons. Then, more than 20,000 people showed up at its Farmingdale store the first day, and the crush clogged the aisles … The company reassessed its approach. For the debut of a second Long Island store in August, it invited local politicians for a party but kept the grand opening pared down, said Stew Leonard Jr., the chain’s CEO,” who says: “We’ve gone from a thunder to a rain philosophy.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

V8 & Mr Peanut: Iconic Brands No More?

YouGov BrandIndex: “Two of the most well-known legacy supermarket products — V8 Vegetable Juice and Planters Peanuts — show significant declines in multiple consumer perception metrics over the long-term … From 2013 through the present, both of these brands have suffered their own distinct issues, and one big shared one: millennials.”

“Both V8 and Planters Peanuts are seeing their levels steadily eroding over the past four years, almost entirely brought down by millennials. 94% of all consumers were aware of V8 in January 2013, slipping down to its current 85%. Planters took a steeper drop of 17 percentage points, dropping from 95% down to 78% over the same time period … Millennials change the picture entirely, especially for Planters Peanuts: V8 is down 14 percentage points (from 86% awareness to 72%) with the younger crowd, and Planters Peanuts sees a 32 percentage point fall (from 83% awareness to 51%).”

“V8’s Value and Quality perception with overall consumers has also been falling steadily since 2013. Except in this case, instead of millennials, adults 50 and over dominate the growing negative numbers behind these two metrics, perhaps having been priced out of purchasing the vegetable juice. Consequently, Purchase Consideration by boomers of V8 has declined as well: the juice went from 43% of adults 50 and over considering buying V8 the next time they were purchasing a beverage to 33% now.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Airbnb Antidote: Hotels Take Aim At ‘Self-Worth’

The New York Times: “With competitors like Airbnb nipping at their heels, hotels are rolling out experiences to their most faithful customers that go far beyond extra nights and room upgrades. Want to improve your cooking skills? How about a class with a Michelin-starred chef? Or snorkeling in Hawaii with Jean-Michel Cousteau? Or basketball tips from the N.B.A. standout Dwyane Wade? … In offering such exclusive experiences, hotels are looking to establish deeper connections with their customers in the face of growing competition from start-ups.”

“Marriott is trying to differentiate itself by focusing on self-improvement activities, in part because its own research suggests this is how people will increasingly spend their money when traveling … Such experiences not only increased travelers’ self-worth and satisfaction, the research found, but travelers sought to share the interactions with experts on their social channels.”

“The large hotel brands are mindful that right over their shoulder, Airbnb, in particular, is reinventing what travelers expect from a local stay by introducing smaller-scale experiences and classes, which people can bid on through its site even if they are not staying in an Airbnb rental. One in Paris, for example, offers to teach patrons how to sculpt a head from clay, taught by an artist who studied at the Louvre museum. Another offers a class in San Francisco on creating a French macaron.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

How Whole Foods Steals Walmart Shoppers

Business Insider: “When Amazon’s acquisition of Whole Foods formally went through in August, the e-commerce giant immediately made some changes — most notably, significant price cuts … The biggest source of foot traffic for Whole Foods were regular Walmart shoppers. People who visited Walmart at least twice a month accounted for 24% of new Whole Foods customers the week of the price cuts.”

“Across the board, the customers who defected to Whole Foods from grocery rivals were wealthier than the retailers’ average shopper … Walmart’s regular customers’ average income is $59,264, according to Thasos data; the average income of a regular Walmart customer that is defecting to Whole Foods, however, is $71,697 … While Walmart has aimed for more aspirational customers as Whole Foods cuts prices, Thasos data proves that both retailers are competing for the same shopper: the upper-middle class customer who is increasingly important as wages stagnate for much of the US.”

“All of this means that wealthier shoppers are increasingly influential, forcing bargain-centric retailers like Walmart to expand into more aspirational brands … Walmart is gearing up to cash in on wealthier customers, especially as it expands its e-commerce lines. Whole Foods winning over high-income customers could force Walmart on the offensive in this battle — one that both retailers are determined to win.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Costco Knockoffs: It’s Cruel to Be KIND

The Wall Street Journal: “Kirkland Signature, Costco’s store brand, is challenging manufacturers hoping to earn or retain a coveted spot at the warehouse retailer. Since 1995, Costco has used its Kirkland products to attract shoppers, building a reputation for quality and low prices on milk, toilet paper, men’s shirts and golf balls bearing the unassuming red logo. About a quarter of Costco’s $118.7 billion in annual sales come from Kirkland Signature products, and the percentage is growing, company executives say.”

“Costco often introduces a new Kirkland product when its buyers or executives believe a brand isn’t selling at the lowest possible price.” For example: “Kind Bars sold for about $18 for a pack of 18 … When almond prices dropped in 2016 … Costco developed the Kirkland Signature Nut Bars, made by Leclerc Foods USA, which is owned by Leclerc Group, a Canadian manufacturer, and now sells a 30-pack for $17 in stores.”

“Kind Bars are still carried at Costco, though mostly new varieties, including fruit bars, mini nut bars and a peanut-free bar. ‘We look forward to continuing to grow with them,’ a Kind spokeswoman said.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Perennial Seller: Make Connections, Not News

The Wall Street Journal: In Perennial Seller, Ryan Holiday “emphasizes the value of low prices and word of mouth over press coverage. Raymond Chandler, he writes, became the ‘quintessential detective author’ because he encouraged his publishers to sell his books as pulp paperbacks, for 25 cents a copy. Suddenly his books went from selling a few thousand copies in bookstores to hundreds of thousands in gas stations, train stations and cigar stores. Humphrey Bogart as Philip Marlowe followed.”

“Likewise, the comedian Drew Carey’s long run on network television began with an invitation from Johnny Carson to appear on “The Tonight Show.” Validation by one person whose opinion is valued, Mr. Holiday argues, is worth all the press coverage in the world.”

“Iron Maiden has never relied on hit singles or frequent radio play, since its songs often run to 10 minutes, with solos from each of its three guitarists. Instead, the band has toured almost nonstop, building close connections with thousands of fans who now buy almost anything it puts out, from albums to beer to belt buckles. Its core of hard-core fans, Mr. Holiday writes, has allowed Iron Maiden to ‘endure through fads, technological shifts, and the fact that their music was never mainstream’.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Eataly Regulars: Try Some & Buy Some

The New York Times: “Eataly NYC Flatiron, which opened in August 2010, has become a popular attraction for tourists. They pack the 50,000 square-foot Italian food emporium, cameras in hand, to buy Italian imports and dine at its several restaurants. But in the produce section, there’s nary a tourist in sight. This is where regulars … stock up on their fruits and vegetables. Produce is delivered and restocked twice daily. Some of it, like blood oranges, Italian frisée and radicchio di Castelfranco (a red-streaked, bitter yellow leafy vegetable) is shipped in from Italy while the rest is from around the United States and nearby farms.”

“On the hunt for fresh baby corn or purple baby cauliflower? They’re here. So are about 17 kinds of mushrooms, including lobster and blue foot, and all sorts of radishes like Easter egg and Cincinnati. The staff of 14 is well-versed on the produce, and tasting is encouraged.” Produce manager Lenny Espinal comments: “I’m a big believer in the try-before-you-buy philosophy. If you don’t like it, you won’t waste your money buying it.”

“One of the department’s most interesting features may be the vegetable butcher, Nicole Williams, who stands at a counter with a sink at Eataly’s vegetarian restaurant, Le Verdure. She washes and chops customers’ fruits, herbs and vegetables for free. She also prepares samples. Recent offerings included watermelon chunks and jicama rounds dressed with olive oil, salt and lemon.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Academy Sports: First-Responder Retailer

The Wall Street Journal: “A sporting-goods retailer found itself at the center of the rescue effort in flooded Houston, first opening its stores to rescuers in need of boats, life preservers and other supplies, and then converting its headquarters into temporary residences for hundreds of police and other emergency responders. As of Wednesday morning, retail chain Academy Sports + Outdoors was hosting more than 400 rescue-team members at its corporate campus west of Houston, with people coming to work in 12-hour shifts from as close as Waco, Texas, and as far away as Connecticut.”

“Academy has a history of contact with law enforcement because it sells firearms in its chain of 235 sporting-goods stores. Dealing with the Federal Bureau of Investigation and other federal agencies is a daily part of its business. So when the first call came in Sunday from the Houston Police Department requesting flat-bottomed jon boats and paddles, Academy brass weren’t all that surprised. But the calls kept coming … they wanted kayaks, canoes, ponchos and pontoon boats. In many cases, Academy opened the doors of closed stores so first responders could grab what they needed.”

“As waterlogged evacuees made it to dry land, they needed more. Sleeping bags, air beds, backpacks, fresh T-shirts, socks, shoes and underwear. Rescuers needed all those goods, too, and a safe, dry place to rest. So Academy opened up its four-story sport-themed headquarters, which hasn’t flooded and still has power. It also has gyms for sleeping and places to shower … Academy is offering financial assistance for immediate needs like hotels for about 150 employees … (and) is deciding where to donate $1 million worth of clothes and shoes later this week.”

Facebooktwittergoogle_plusredditpinterestlinkedinmail