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“Not your father’s” marketing trends

Could it be 25 years already that the TV ad spot  “This is Not Your Father’s Oldsmobile” (see video below, starring the still-slender William Shatner) became an instant classic?!  The catchy phrase was quickly adopted in any context (“This is not your father’s whatever”) reflecting the gestalt of the era.  In other words:  things had changed…

Yet perhaps the change mantra has never been so applicable as in marketing today.  The game has changed, and for many reasons.  To commemorate the New year, below are some of the key ones we see:  the trends we see coming at us less like an Olds and more like a Corvette:

  1. CONSUMER AS CREATOR.  God forbid you asked the customer to help develop your product!  You only dared came out with it after exhaustive research, branding and budgeting.  In today’s era of crowd funding and social signals  (“Like”, “Follow”, etc),  consumers want to share in the creative process.
  2. CALLS TO ACTION VS. CAMPAIGNS.  Used to be you planned a nice and orderly campaign months in advance and ran it on the media schedule you chose.  Today, you need to communicate with your customer all the time:  they pick the time they want to receive your (timely and relevant) message.
  3. MOBILE MATTERS.  It’s all about the smartphone now.  If you don’t have a mobile app you lose cred with consumers, period.
  4. SOCIAL STRATEGY SMARTS.  Before, getting your company name or product up on Google was enough.  Now, with tighter content controls, search engine optimization (SEO) has become quite a science.  With SE recognition of complete questions instead of just keywords,  this provides more opportunity for capturing them (the good news), but you have to keep working at it.
  5. INBOUND ABOUNDS.  It’s not about pushing your product out the door any more.  Attracting customers by the online content you create and the value your company provides is the all-important pull strategy that builds long-term loyalty.
  6. OMNICHANNEL SURFING.  Back in the day, it was solely the bricks & mortar  that counted.  Today, you may still want to get them in the store but the outreach now involves additional platforms, all working together to achieve “omnichannel”, or seamless shopping experience for the customer. (We’ve posted about this trend a few times, so please check out the topics on right)
  7. B2B SPECIALTY.  More than at any other time, business-to-business marketing is becoming a recognized and respected specialization.  Helping businesses do business better is critical in these times of reduced resources, higher costs, aggressive competitors and demanding consumers.
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Lost in translation: convert shopper intel into action

lesson #1:
Is your shopper intel lost in translation? (Photo: NapaneeGal)

There’s no question information is power, especially when it comes to targeting shoppers.  Companies  like Kantar and Marketing Lab, among others, specialize in providing insights to help retailers better align their shopper research, store ops, merchandising and upper-management buy-in with vendor products and programs.

The ability, or more emphatically, the willingness of chain management to translate this information into actionable sales steps for their stores is critical.  However, it seems most can’t or won’t do it.

MarketingLab’s recent retail survey reported that 85% of chains have been participating in vendor-funded shopper programs.  However, less than five percent of those feel they are successful in incorporating insights into action. This is a grim rate, indeed, especially given the effort and money involved.

Why do these marketing insights appear “lost in translation”? Did the chain not understand the information?  Was there directive from Corporate on how to best align those with sales goals?  Was the vendor at fault for not providing more guidance?

The answer is probably a combination of all three, but most likely the third:  vendor at fault.  We say that because we, ourselves, have been guilty of this in the past.

We admit we have conducted exhaustive (and pricey) studies of a client’s category or products, matched the findings nicely with a retailer’s customer profiles, then handed the whole kit & kaboodle to the chain’s marketing execs.

With a handshake and a big smile, we’re off.  But when we call on them again months later, we see the  file still sitting on their desks, gathering dust…

This situation is not only a waste of everyone’s time, but goes against the basic premise of the vendor/retail partnership, which is mutual advantage.   It’s not that the chain doesn’t want that intel;  it’s just that their personnel may not have the creativity, knowledge and even less time to review it and execute relevant programs.

It is then incumbent on the supplier to take steps to ensure their valuable support is both appreciated and executed.   We have found that these six simple steps help get action in that area:

  1. Findings are not enough.  Fascinating factoids about a chain’s customer base without relevant implications and proposed next steps is a time-waster.  Specific proposed solutions should be part of every research study.
  2. Work within strategies already in place.  Don’t propose, say, an aggressive mobile marketing campaign when the chain has never done one, or is unsure of its commitment to mobile to begin with.  The learning curve is too steep to ensure timely and successful results for both client and retailer.  Stick with the venues and strategies they are already comfortable with.
  3. Ensure upper-level buy-in.  If the Big Cheese doesn’t like it, or the intel doesn’t fit the chain’s goals, culture or capabilities, it won’t make it to store level.
  4. Taking it to the streets.  Conversely, we have found that field merchandisers — foot soldiers who visit stores frequently– are often instrumental in gaining program execution.  In many cases they are the ones in there putting up the POS, running the customer surveys, guiding department managers, etc.  In short, making sure the program is given life.   Sometimes the influence works upward:  an excited department manager tells Corporate he can’t live without the  program. (Caution:  some chains won’t allow this type of vendor interaction at store level.  Get it OKed first.)
  5. Start small, then roll out (maybe).  Don’t go in with the entire enchilada.  A big program that involves all stores in a chain is a risky proposition for all.  Start with specific stores, districts or other grouping that best align with your target consumer and program.  Test small, then increase  gradually, measuring results along the way.  It may never reach complete roll-out, but at least you’ll have a track record and case history to boast about.
  6. Address the “YIIFM?” Factor.  Competitive and job-security issues are at the top of many retail personnel concerns today.   “What’s in it for me?” is a question often asked or at least implied.  Be sure to sell in the benefits of their having the program to begin with, or otherwise appeal to the self-interests of the personnel involved.  Is it general PR they lust after?  Do they want to gain attention from their boss?  Is it all a vanity effort with no care for ROI? Go with what floats their boat, and thus avoid the sinking ship.

Is “Grey Thursday” here to stay?

Some pals not involved in the retail world have asked me why they call the Friday after Thanksgiving Black Friday.  Our esteemed (and smart) readers all know the answer.  (For those still in the dark, check out Wikipedia.)

English: Nordstrom at Washington Square (Orego...
No Grey Thursday for them…

Let’s clarify one thing:  we LOVE a hot sale!  We are all about selling; it’s our reason for being.  In the food business, this is the most profitable time of the year. Bring’em on!

What we are not so hot about is this new trend of shopping for stuff on Thanksgiving Day.  So many seem to be doing it now (in the states with no Blue Laws, of course). Many, except for our revered Nordstrom.

Our love affair with the chain began when we first blogged about them years ago.  We highlighted a personal experience involving the delivery of an evening gown, expertly altered,  to our very doorstep by their department manager a couple of hours before a special event.

The other custom that sometimes backfired on them but made you love them even more was their no-questions-asked return policy.   We understand they even took back a few car batteries…

In short, “Nordys” gets retail, espousing the “ABCs” of customer service.  According to Boston Retail Partners, these are:

  1. Anticipate customers’ questions before they ask.
  2. Be ready to offer suggestions for upsells and cross-sells.
  3. Create an interactive experience throughout the store.
  4. Deliver personalized offers and promotions.
  5. Execute a seamless checkout experience.

Their strong understanding of what they do and why they do it  is why you won’t see any Christmas decorations or hear any carols sung in Nordstrom stores until Friday. “We just like the idea of celebrating one holiday at a time,” their signs and ads say.  

Their web site also explains why they believe their employees should spend holidays with family.   Judging from the positive comments about this on their and other news sites, consumers are on their side.

The idea they espouse of “celebrating one holiday at a time” is sound, especially when you consider that Christmas decorations as early as Halloween (even in August, in some cases!) are really an affront to our senses.  As a business strategy, it also reflects a  lack of imagination, and we know that to succeed at retail you need lots of imagination.

There was a time, not long ago, when only a few retailers would open at Thanksgiving.  Not a great idea, but at least they were different; they stood out.   Now, everyone seems to be doing it.

We all know that swimming in a sea of sameness is the death knell for retail.  In fact, there is already a segmentation between customers of the lower-end, price-strategy chains (who are open on Thursday) and the service-strategy ones who don’t, and that the twain shall never meet.

Today we applaud those retailers who know how to take a stand but also how to stand out in the marketplace.

A VERY HAPPY THANKSGIVING TO YOU AND YOURS!

Food deserts & double jeopardy

Bit of an urban sprawl
Searching for the green in urban sprawl (Wikipedia)

On a recent trip to Latin America, we were sharply  aware of the great divide that exists rich and poor, between “good” and “bad” neighborhoods.

While this delineation exists in the U.S. of course,  it seems more marked down there.  As you drive through gargantuan urban sprawl, it’s like crossing invisible border fences.

One of the key aspects of this economic divide is the dearth of supermarkets in lower-middle class to poor neighborhoods.  These are the so-called “food deserts” that blight large cities, where not one fresh tomato can be found within miles, and where eating healthy is never in the cards.   If you are what you eat, then these folks will remain forever poor.  (see related stories, below)

It’s not only the lack of green vegetables that is troubling:  it’s the lack of green, period.  With mom & pop or convenience stores charging far more than traditional supermarkets, few folk have any money left after shopping for basic food items.

The recent opening of a Sam’s Club in a poor section outside Rio was greeted with a shrug and comment by a local:  “Stock up?  We can barely afford one toilet-paper roll at a time.”  The question then begs:  are food chains positioned to serve this population segment?

This week, the Journal of Preventive Medicine addressed this topic in a study which showed that poor, mostly black neighborhoods face “double jeopardy” when it comes to supermarket access.  Specifically, the study strove to address what it meant  to be in a poorer white neighborhood versus a wealthier black neighborhood.

Here’s an excerpt:

“…living in a poor, mostly black neighborhood presented “a double disadvantage” in supermarket access.  Unsurprisingly, poor black neighborhoods had fewer supermarkets than wealthier black neighborhoods. But they also had fewer supermarkets than poor white neighborhoods, suggesting that race still played a role apart from poverty.”

However, this was different in Latino neighborhoods.  Though they had fewer supermarkets than Anglo areas, Latino neighborhoods had more grocery stores than black areas, regardless of the  poverty level.

In short, the lack of supermarkets in disadvantaged area was not only an economic but a racial issue as well.  This infers that supermarket chains who traditionally profile customers by income level should look more carefully at the the race equation as well.

Accurate profiling of retail customers has never been as important, especially since today a “traditional family” can mean two gay guys with a dog.  For marketers, it’s a reminder that, more than ever, one size no longer fits all.

Pretail: the new shopping trend

A new trend is poised to change shopping as we know it:  pretailing.   This emerging practice could really throw a wrench on our beloved “path to purchase.  According to agency JWT, pretailing is not just a fad but a “top ten” consumer trend.

English: Leonardo da Vinci in Amboise Русский:...
With crowd-funding, you can make like Leonardo (Photo credit: Wikipedia)

What may be game-changing about this is it’s not about giving consumers a sneak-peek at your new creation, as at an auto show.  Instead, it’s about people creating the product they want to buy.  In fact, they want it to so much they are willing to pay you to make it.  It’s like being commissioned for a great work, Leonardo da Vinci-style.

Success can quickly go to your head in the new world of pretailing because you actually see the money pot being raised.  Yet the idea of shopper-as-mad-scientist — co-creator of your grand idea —  may not actually thrill because you could lose all control.

Pretailing is brought to you via the new darlings of the “internether”:  crowd-funding.  Sites such as  KickStarter, Christie Street, Outgrow.me, the winsomely-named Tiny Light Bulbs, and others are where they have you at: “Hello…what the heck is THIS?”  And every new “this” means money.

The “pretailing marketplace” grew 85% to USD 1.4 billion during 2012.   Trendwatching reported that in one year, Kickstarter recorded 2.2 million people in 177 countries putting down  $275M to see their favorite products produced.

With all this warm & fuzzy acceptance pre-prototype, marketers may fear the R&D, focus groups, ideation sessions, channel analyses etc.  they excel in will all go pffft…   Do we need to destroy the smoke machines and wrap the mirrors in black?

Before we panic,  let’s remember that this is all about getting a product made.  But how about its survival?  Only time will tell if pretailing will decrease the high rate of new products that fail on the shelf.  In a fragmented distribution world, the right product is a good thing but the right channel is the secret of life.

That’s why we don’t see any decreased demand in expert marketing research and roll-out strategies for new products.  In fact, in a crowd-funded world, the challenge may be to stand apart from it.

In fact, we predict the demand for comprehensive market and trends research to ensure staying power will be even greater with pretail, especially since there is OPM (or, “other people’s money”) involved.   As every public company executive knows too well:  where there is OPM, there are rules.

The Retail Games

Black Friday line
Let the Games begin!

For the sake of your health and safety, not to mention sanity,  we trust you came away unscathed from the recent shopping madness this past weekend that concluded with Cyber Monday.

What’s next:  “Techie Tuesday”?, “Wacky Wednesday?”  (Don’t laugh, and remember:  you saw it here first).

You’d hardly know there was a recession going on for the crowds that made this Black Friday allegedly the best on record (final sales figures still to be tallied), sending retail chain stocks soaring 5%+.  The Occupy Wall Street folks who organized to boycott “big chains” during the Holiday didn’t seem to have made a dent.

For marketers this urge to splurge is a rather thrilling, if unsettling, phenom.  After all, it was only a few years ago that the term “Black Friday” even became part of the American lexicon.  An elderly family member still thinks it’s some newfangled  religious holiday…

With stores now open during the sacrosant Thanksgiving Day, retail is now a new ball game:  one where nice guys finish last.

The protests of the pious about spending this time with family makes a good point, but the harsh truth is that retailers would not be opening their doors if there wasn’t demand.  And consumer demand has apparently reached a fever pitch as shoppers with pepper sprays and push strategies win the day.

As marketers, here are some key questions to ask ourselves about this trend:

  • If everyone’s already shopped out by Black Friday, what becomes of other Fridays…or any other day before Christmas?
  • What happens to manufacturers when inventories are already depleted for the Holidays and no new orders come in?
  • What do retailers do when their gross margins are dented by these deep discounts?  Do they dive even deeper?
  • If consumers only crave deep discounts, how will we wean them back into EDLP?

You may recall the halcyon days when many chains employed  Hi/Low pricing strategies, where discounts were something to be savored, special promotions were creative hallmarks, and blowouts only occurred post-Holiday. 

With Everyday Low Pricing the norm and “extreme couponing” the end game, it’s a challenge to make a case for brand-building.  Or is it?

We’ve blogged about the complex human character that hungers to shop.  There are elements at work in our subconscious that take pleasure in these animalistic rituals taking place in the retail jungles.  In short, the Thanksgiving spending spree is just one big game hunt.

Yet, once the thrill of the chase, the stampede of the crowd, and all that glitters disappears and shoppers finally view their prize quietly at home, do they hear the little voice asking:  “What is this garbage you just spent your last dollar on?!”

Stuff shoppers may not tell us

Soldiers and Family members participated in th...
Even the Armed Forces uses focus groups

At the same time marketing pundits are proclaiming that focus groups are dead, they’re trying to unearth what makes consumers tick. 

Used to be if you were a manufacturer and wanted to get some real qualitative (as opposed to quantitative) info on your new product, you’d put a focus group together. 

Get a small group of women together in a room all day, feed them well and pay them something, and they’ll tell you anything…Fact is, focus groups, when done well and includes multi markets and profiles, can give you information you can’t get anywhere else. 

Qualitative info(the hard numbers) you can get from scanner data.  Intimate stuff, such as what truly turns a shopper on:  things she would never tell anyone outside that room, that’s what makes focus groups useful.

But it seems this practice has gone the way of the Dodo bird, as “mystery shopper” clubs, chat rooms, on-line surveys and mobile apps appear to provide marketers with enough fodder from consumers.  Although these arguably much lower-cost tactics have their proponents (on-site focus groups can be very pricey), they still can’t be compared with being able to gauge the immediate reaction on the face of a group participant.

Now it seems this psychographic profiling and what it reveals is making a comeback.  It’s interesting that marketers claim they now want to get inside the consumer’s head when what they’ve been doing is mainly blitzing coupons at her…

In any case, Kraft just announced they’re developing a sophisticated new science of  “emotional profiling to provide actionable answers”  both for them and their retailer partners, according to trade pub CPG Matters.  Apparently, they are splitting hairs about whether shoppers “like” or simply “prefer” something, and how that spells the difference at check-out.

We’ ve always tried to look at the “need to have” vs. “nice to have” component of any marketing outreach.  Especially in today’s economy, folks are going to look carefully at what they buy, and probably prefer the former.  Do we really need the “green” detergent that costs so much more?

Yet food is a different animal.  There exists strong triggers — look, aroma, taste, and emotional ties — that make the food decision for us, regardless of logic.  How else can you explain the Australian expats’ continuing love of  Marmite

One of the key challenges facing manufacturers like Kraft is that this emotional reaction to food means, as they put it:  “that two identical-looking products could achieve the same score in acceptability tests, but perform wildly differently in the marketplace.”

That we shop with emotion is nothing new, and psychographics have been part of the marketer toolbox way before we knew what to call it.  Importantly, though, the increasingly ethno and income segmentation of the population adds complex levels to marketing plans.

We used to rely on reports from AC Nielsen and others that provided snappy, “canned” profiles we loved, such as “Bluehairs in Sun Country”, which neatly encapsulated all residents of, say, Vero Beach, FL.  Sure was easy to do specific-store marketing then…

 Today, with ethnic groups making up almost half of some metro markets, things are different.  Importantly, the cultural diversity means traditional tools like focus groups don’t work as well. 

For example, Latinos will typically say things that may not be true just to please the researcher.  Also, the acculturated/assimilated Hispanic may shop more like an Anglo…except when she’s with her mother.  You get the changing picture.

Trying to make this emotional connection to the consumer is nothing new.  It’s just so much harder today.  That’s why if the Big Guns are seeing the need to reinvent segmenting strategies to hold onto their brand dominance, we smaller guns should also.