Archive for February, 2012

Focus your marketing on top-tier or new customers?

From a new RetailWire discussion: The blogger Mark Heckman discusses his argument for focusing promotional efforts and ad budgets on “best” customers rather than using circular dollars to encourage trial. I agree with a lot of his premise but it’s not that simple:

Mark Heckman brings up some valid points that are fundamental to a sound CRM strategy. You can’t ignore the sales and profit potential from your “platinum” customers, and some solid data mining will help uncover ways to drive their loyalty.

But, as usual, it’s not an either/or choice between “best” customers” and new ones. It depends more than anything on the objectives of the business: Is trial more important than loyalty during a start-up phase, or when a retailer is trying to gain share in a new market? The trick is to use some of the strategies discussed in the article to convert the first-time consumer into a loyalist.

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Thin Mints, anyone?

From a recent RetailWire discussion about new sales tactics being used by Girl Scout troops in the Twin Cities area…I think it’s a smart move to use ideas like credit card processing and kiosks to raise more money for a great non-profit cause:

I’m not sure whether the new Girl Scouts tactics really threaten the market share of major food retailers, but it is good to see a nonprofit thinking “outside the Thin Mints box” about updating its selling techniques. Most of the methods described in the article (accepting credit cards, mall kiosks) are not exactly new developments but could be rolled out to other regions. The next challenge is to develop e-commerce as well as tactics to sell cookies and other products during the holiday season, not just during the spring.

Thoughts on Super Bowl ads (part 2)

With the benefit of hindsight, here’s my take (from RetailWire) about the crop of commercials aired during the recent Super Bowl:

A pretty mediocre bunch of ads this year. The beer ads were particularly disappointing compared to past years, when audiences looked forward to Bud Light spots in particular. Dogs sell, along with babies and chimps, but some originality is is order. (Best exceptions: The Acura and Chevy truck commercials.) It’s possible that my enjoyment of the game was spoiled because the Packers weren’t playing.

Because Chrysler ran its spot with Clint Eastwood during halftime, this probably didn’t end up with much polling data. But there is no doubt that this was the most striking ad of the evening, and destined to be talked about even if it never airs again. To put a political spin on it, this would make a great reelection commercial for the Obama campaign.

Thoughts on Super Bowl ads (part 1)

The focus of a recent RetailWire discussion was Super Bowl TV ads…not the spots themselves (more on that later) but the idea of exposing them ahead of time online. I have no problem with it, given the huge cost of a 30-second spot and the desire to find a larger audience:

The trend toward online advertising creates more viral interest in watching the commercials during the game, not less. This sort of “sneak preview” seems to be drawing larger audiences to the Super Bowl, regardless of interest in the actual game or teams involved. Last year’s Super Bowl was the most-watched ever, and we can expect this year’s game to surpass it. If the goal is to expose advertising to a broader audience, more power to the online commercials.

Ralph Lauren: Why does the brand still work?

A brief comment (below) from RetailWire about Ralph Lauren and why its brand management has been among the best in the business:

Ralph Lauren is a great example of a brand that has stayed true to its aspirational position. It has successfully addressed different retailers’ price point requirements (as well as the higher prices in its own stores) while keeping a very consistent “lifestyle” point of view. It’s an object lesson to other consumer brands: You don’t have to reinvent yourself every year to stay fresh and relevant.

Walmart: End of the “greeter”?

My comment (below) was in a minority among fellow RetailWire panelists. The subject: Walmart’s transition from its famous “greeter” program (at the store entry) by redeploying these associates to help move customers through the checkout lanes. I see it as a positive:

Checkout lane management is becoming a more important part of the customer service process. Most customers would prefer an efficient experience at the end of their store visit, rather than the traditional Walmart “greeting.” I agree with this move, especially if it is expense-neutral.

Is JCP trying to reinvent the wheel?

I wrote the following comment for RetailWire after listening to the recent presentation by JCPenney senior management about their strategic initiatives. (I will have plenty more to say on the subject as the execution and results become apparent.) I will add — having shopped a couple of JCP stores since the beginning of February — that they need to communicate the new value proposition much more clearly than they are doing now.

The new pricing strategy at JCPenney is a bold experiment, and time will tell whether it will cause JCP to gain or lose market share. (It’s certainly a “statement” about brand differentiation.) I do wonder how the re-pricing affects national brands with broad distribution and “suggested retails”…everyone from Cuisinart to Nike to Seiko.

But I often find that retailers should address issues of merchandising and the store experience before (not after) dealing with branding and other marketing issues. JCP is tackling its brand position first, perhaps because it was the easiest to get done right away.

Mr. Johnson drew several parallels to the Apple “narrative” during his presentation yesterday, and many skeptics have pointed out the differences. (The Apple Store sells a narrow assortment from a single brand with a “cool factor” drawing crowds to new product introductions.) As JCP evolves its merchandising and store experience — on a rather slow timetable — it would be smart to infuse the sort of excitement surrounding short-duration promotions that has driven traffic to retailers like Target and H&M.


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