RetailBizBlog

Last Wednesday, I posted that I was attempting to test the "Social Networking" power of two of the most popular networking websites; Facebook and Myspace. I ran several links to this bulletin on both sites. I also posted several links on other popular sites, LinkedIn and Twitter, asking people to vote on which site would provide the best source of traffic that would benefit a retailer looking to advertise. Lastly, I created discussion groups asking the same question. The winner by overwhelming landslide- .... drum roll please .......FACEBOOK!!! Facebook, was described as having a much more active community. Their interface is much more organized and easy to use than Myspace. There were several comments from Myspace users that would switch exclusively to Facebook if Facebook were willing to allow for profile modification and a music player. I must also note, that Myspace almost came in third place behind several "write-in" votes for Twitter. Part of this test ...

I was forwarded an article about several quotes from Costco Founder and CEO, James Sinegal. Quotations From James Sinegal He mentions several things that I think most retailers should listen to. I particularly like two of the quotes: 1. "I think the biggest single thing that causes difficulty in the business world is the short-term view. We become obsessed with it. But it forces bad decisions" With all the growth that has occurred over the last several years, many retailers got caught up in the short-term, and did not make wise decisions that would protect themselves from the inevitable slow down in the long-term. I think Mr. Sinegal hit the nail right on the head with that one! 2. "This is almost like show business. I mean, every day you're opening up and it's show time." This has actually been a saying I have heard in variations for years. Those who practice it do very well. This translates to everything from the cleanliness and visual standard of th...

AOL started it. With very popular chat rooms and a skeletal, but functional, social network. Myspace , Facebook , Twitter , Bebo , Friendster , LinkedIN and several others have since emerged. All offering something unique to make their platform the biggest and most successful. As I learn more about blog writing/internet marketing (yes, they go hand-in-hand), it is clear that these sites drive the "personality" that the online society has taken. To be successful online, it is clear that a strong and steady participation and presence on these sites is critical. This blog generates reports that allow me to view the sources of my daily traffic. So far, Facebook, Myspace, and LinkedIn, are responsible for a LARGE portion of my visitors. I am pretty much a "nobody" writing on a topic that interests me. I realize how amazing it is that because of the internet, people from around the world are reading what I am writing!! I wonder how powerful these sites would be...

As with Whole Foods, Starbucks is another major company that has taken a look at themselves and are offering something new. A Starbucks that is not a "Starbucks"!! NPR reported Saturday, Starbucks Goes Into Stealth Mode . Starbucks, a company that has done pretty much everything it can do, has found a way to continue to grow in their same niche. They looked outside themselves, the ones who commercialized and popularized the industry, to find out what more they could do. They "dropped" their own name, and essentially the brand recognition that they have "taken over the world" to achieve, to offer a "mom-and-pop" feeling coffee house experience. Two more additions to this new venture is the addition of alcoholic beverages and live music. I do admire and even encourage major corporations to take a look at themselves to discover opportunities for growth. However, I do have a criticism on this Starbucks approach. If they identified the late(r...

In a time when customers are demanding value and are really trying to stretch ever dollar to it's limit, some companies are doing their part to help. Whole Foods Markets are giving "value tours" to their customers to show them that even at a store with a pricey reputation, value is within reach. You can read more about their approach in Hawaii's Star Bulletin's: Getting the Whole Picture. I previously discussed the importance of corporate image to consumers. Whole Foods, embraced their reputation as a high-priced grocery retailer. They offer a level of quality and freshness that has raised the bar in the grocery industry. Instead of lowering prices and sacrificing the bottom line to grow their seemingly cult-like following, they took a more pro-active approach by educating their customers on more cost-conscious ways to shop. This is the kind of "outside-the-box" approach that more companies need to explore.

As I was walking the mall this past weekend I noticed a few strange trends. There were a lot of people in the mall, but there were lots of stores without a single customer. I chatted up some of the employees, and consistently received this generic response, "Yeah, it has been kinda slow lately". Then I went into some of the more "crowded" stores, and heard things like,"We are beating last year!", "Back to school seems to be starting early!", and "The mall seems to be picking up.". How can this be? I did notice one common thread that distinguished all of the slow stores from the busy stores. The stores that were slow were messy and dark. There were fingerprints allover the windows, dust-bunnies in every corner (one actually swirled around the table when I picked up a bag), and lights out around the store. If it is so "slow" how is there no time to clean or change lights? Then, to top it off, the employees had this ki...

Employee confidence has been a major issue that I have tried to address. I read an article today detailing plans of AOL's new CEO Tim Armstrong. "Can Tim Armstrong Think Different at AOL" His description of the "core" problem at AOL, was the employees have a "crisis of confidence". I LOVE that expression!! That fits almost everything I have been saying about the state of many employees! AOL, has been a major web player, well, before I even knew there was a "web" (25years!). Previous CEOs have taken on numerous projects and partnerships (Time Warner), all in an effort to keep AOL competitive with the exponential growth of competitors like Google, Microsoft, and Yahoo. Mr. Armstrong, (formerly of Google's advertising division) has a "new" vision for AOL. What struck me, is it is not far from the "original" vision of AOL. I really wish AOL the best of luck. I am excited to see a Leader remembering where their s...

As we are all searching for the next best way to cut costs, I ran across an old article about an approach Delta Airlines took in the mid-90's. They asked their employees! On an employee suggestion, they removed the lettuce leaf that was served in their food trays as garnish to an astounding $1.4 million in annual savings! http://gtalumni.org/Publications/magazine/win93/delta.html I recently worked for a company that was so incredibly operationally inefficient that I was amazed they were still in business. Three months later, they weren't! From having way too much lighting in the stock areas, to a time-wasting price change procedure, to unnecessary shipping costs($4ship fee for a $.99 item), to incredible wastes of paper (I actually counted a minimum of 45 sheets per day wasted...in one store). This store had so many little things that could have completely changed the cost of business, it is a shame they didn't listen to their employees. Employees may not have t...

With all the talk of decreasing traffic, and customer conversion, many companies are not trying to ask for the undeliverable, they are doing their best to help you. Mailing lists, and customer information gathering has been around forever. The "old school" thought is that it is crossing a "privacy" line, and many employees don't feel comfortable asking customers for personal information. Some employees will disregard the procedures simply to save time during the checkout process. Times have changed. Email is rapidly replacing "snail mail". As percentages of households owning a computer increase, so do business opportunities for almost every retailer. Direct mail advertising is disappearing. It is resulting in less and less customer impressions, is expensive, and is not very "green". People are getting more comfortable with giving out an email address. It doesn't necessarily give out their name, it doesn't tell where they li...

In my last post, I referred to the customer experience as being a major part of a corporate image. I received a few responses asking me to discuss that a little more. With the rapidly changing economic conditions, retail has had to evolve very quickly. Companies are being forced to reevaluate the way they are doing business, and more importantly, reevaluate the customer experience within their stores. Creativity is necessary to increase consumer spending. Ikea is known for their "maze" of sales floor, that is designed to get you to "imagine" all the possibilities to decorate your entire home and office. They incorporate a powerful combination of creative merchandising, aggressive price point marketing, an easy to find sales staff and consumer psychology. They have built a successful business model entirely centered around the customer experience. From their lay-flat packaging, to their low cost food court, Ikea is the extreme model of the customer experience...

Recently, I have been finding myself getting into discussions about corporate images. It seems that some retailers are "playing it safe" in terms of their image. They are carrying lines that have been consistent sellers. The "Gap" that I remember, was the best place to get basics and to fill the "holes" in my wardrobe...guess what? They are again! Even Abercrombie & Fitch doesn't seem so "scandalous" as they now carry an extensive offering of polos, plaids, and oxford button-downs. According to the NY Times, Eddie Bauer has filed chapter 11, and the investor group that is poised to make the buyout, is the same group that passed on Eddie Bauer in 2003 when they were also in bankruptcy trouble. Eddie Bauer executives at the time had a future vision of Eddie Bauer as a conservative womens retailer. The investment firm felt that was not a smart move considering the foundation and reputation Eddie Bauer had established for over 80 years. Now, ...

With the weakened state of our economy, there are several retailers that are turning to "conversion"(percentage of people that enter the store that make a purchase) as a primary statistical measure. Some are even initiating disciplinary action on Managers not reaching company standards. I have heard conversion goals as high as 20%. This can all be very scary. I was told early in my retail career to never make excuses to the state of my business, but instead offer what is happening to improve it. Unfortunately, "People are just not coming in" is becoming a VERY popular statement. It is only natural for a retailer to find the focus that can eliminate that excuse. I once ran a store that was a high-volume store that had fallen from its former glory to a middle volume. When I took over that store, the overwhelming notion from the staff was that customer traffic just wasn't what it used to be. I put a greeter in the front of the store and told him to physica...