Category Archives: retail marketing

We’ll take whatever she is wearing

Play me.

So say you’re surfing the web and see a jacket that looks cool. Could be on anyone — a Facebook friend’s photo, a model over at Esquire.com, a CNN photo of a prime minister. Westfield’s “fashion detector” lets you match the clothing image to any similar brands at its nearest mall location. Not enough? The app works on your iPhone, too, so you can surreptitiously snap photos of attractive lasses walking down the street to find the same short skirt for your wife. Or something like that.

Clever use of image matching and applications to drive impulse purchases. Well played, Westfield.

Via Ads of the World.

Black-Friday leaks those 40% savings ads before they run in print


Shopaholics, rejoice! Black-Friday.net gives you a sneak peak at those savory newspaper ads touting GIANT SAVINGS that run the Friday after Thanksgiving. This naughty site leaks the ads far in advance, allowing you to search by retailer to find just what X% off will be tempting you after turkey day.

NPR reports that Black-Friday gets the ads early either from major retailers, such as Walmart, who want to build buzz or from impish printers who scan the ads as they head for the press. With U.S. retailers forecasting a cold Christmas, the sales could be gigantic. This also points out another failing of traditional newsprint in communicating information; why wait for the ad next Friday when you can download it today? Happy shopping.

Talbots gets unstuck from the middle


Talbots’ stock soared 30% today with news that the retailer was finally ending the Talbots Mens experiment. At face value, the expansion of a women’s luxury clothier to the rougher sex in 2003 seemed a fair idea; why couldn’t a brand known for making women shine do the same for men?

We think Talbots got stuck in the middle.

Michael Porter, in his landmark 1985 book Competitive Advantage, said that firms could succeed only by finding focus. He outlined four basic strategies — you could have narrow or broad scope, and low or high-cost products. Walmart is an example of a firm focused on broad scope with low cost — you can buy everything there, and cheap. Talbots was the opposite — narrow scope, clothing that makes women look really good, and high cost, clothing with quality for which you have to pay.

Porter warned that companies who are niche players risk getting “stuck in the middle” when they expand. You want to grow; so you decide to add on new services or products; and the people who loved you for what you were begin to lose interest. Instead of bacon or eggs, you become oatmeal. It’s a cautionary tale for any business, organization or agency that tries to get too big too fast, and leaves what made it special behind.

We love Talbots; it’s a store that could have been designed by Santa Claus for women, with red and gold logos, shirts and suits tailored to highlight grown women’s figures, and a reference pricing strategy that is brilliant in using “40% off” and “outlet stores” to spur purchases. Talbots is so good at being the ultimate affluent-women’s store that the men they are married to couldn’t think otherwise.

So, welcome back, Talbots. Here’s to growing up just the way you are.

Why men in red pigtails didn’t help Wendy’s


Leigh Householder over at the Advergirl blog explains why the Wendy’s red wig campaign failed — it was out of sync with its customers. Leigh suggests that fast-food consumers fall into four segments: families & kids, convenience eaters, calorie nullifiers (that is, working guys who need real fuel), and, yes, all-day eaters. Her handy chart above shows Wendy’s slipped by not matching the ad promise with restaurant reality.

The red wig certainly was controversial. Advertising Age lauded the Saatchi campaign as almost perfect last May, but other critics said the spot was only memorable and didn’t sell the product. A key metric — Wendy’s sales in U.S. stores open at least one year — slipped 0.8% in the fourth quarter, perhaps due to poor economy, perhaps to distasteful images of men in pigtails. Wendy’s killed the campaign in January for a new approach focused squarely on the food. Chief exec Kerrii Anderson concluded, “we can’t be something that we’re not.”

It is tempting to try to craft an ad message that breaks through today’s clutter. The lesson from Wendy’s may be killer concepts are not enough. Marketers need to provide a plausible promise, something that reaches the right demographic, and matches the actual operations experience. Perhaps it’s time your CMO took your COO out to lunch.

Borders and the beauty of stuff we don’t seek


A snow squall caught us driving back from New Hampshire today, washing out the Mass highway in a pre-spring whiteout. So we took refuge at a Borders. Man, the place has everything. And the bookstore also reminds us of how awful the internet still is in marketing to consumers.

You see, good physical retail design gives you thousands of communications you do not expect. The best of these are enticing — the book on meditation, the Seattle Coffee, the chocolates by the register that delight you but, hey, you didn’t really ask. The web, by comparison, serves up just what you want. Unfortunately, we self-absorbed consumers fall into ruts, RSS-feeding ourselves from the same 100 marketing or photography blogs, reading the same authors. The faint personalization web merchants can pull off is based on our history, which is the history of a ditch.


Ah, but now a real bookstore. In 30 minutes at Borders we discovered a new book by Chuck Palahniuk, Jack Kerouac on the Road, a display of chocolate, a naughty book on sexual positions, inspiration from Buddha, cooking, finance, concert DVDs by Clapton and John Mayer (parental mission to turn our kids into rock stars) … sure, we could find all of this online, but we would never think to ask, nor digest so much so quickly. The marketing worked too, because before we knew it we were out $98.57.

Personalization fails online because it hones in on our already narrowed interests. Amazon.com may serve up 40 or 50 links, but that is nothing to the 10,000 unique impressions in a well-designed retail space. We may search for marketing books, but perhaps what we really want right now is chocolate-mocha coffee.

The human mind was designed to take in and filter millions of stimuli each day. Marketplaces were once places that served up choices to fill our need to sort, to find, to delight in the unexpected. With the web, we’re still waiting.

(Footnote: Lest this seem too promotional, note to Borders executives — please call off the clerks from pushing the loyalty card. And the fact that your web site is missing in action and instead “partners” with Amazon … we know you gave up in 2001, but skipping the whole ecommerce thing just feels lame.)

McDonald’s sexy new image


The new Mickey D’s makeovers have started to land near our home town. We stopped at a red light by a McDonald’s restaurant in an old Connecticut mill town today and did a double-take — behind huge glass panes we could see elegant lighting, muted greens, and what looked like granite tables.

McDonald’s started the massive redesign of its 30,000 global stores back in 2006, chasing Starbucks with three new ambient partitions — a sitting area with Wi-Fi and arm chairs, a “grab and go” zone with bar stools and flat-panel TVs, and a “flex” zone with colorful — but not plastic — seating for families. Even the red mansard roof will eventually get whacked, and the total cost works out to about $350,000 per store, about equal to a year of a single store’s profits.

The McDonald’s revolution, along with upscale salad, coffee and chicken menu tweaks, may be the ultimate sign of the democratization of good design in the U.S. And the hyper-expensive move should pay off. McDonald’s was on the verge of becoming a plasticky anachronism, got crap a few years ago for dirty stores and sloppy operations, and even though we loved it as kids, we cringed as parents every time our kids asked to go. The old McDonald’s was akin to reading a week-old newspaper; even if the content was OK, we don’t want things that are out of date.

Funny how changing red and yellow colors to terra cotta, yellow, olive and sage makes little burgers on stale buns taste better. We’re loving it.

The psychological warfare of pricing


With only three shopping days until Christmas, we have some good news. Retailers in America have banded together and announced that all products will now be 70% off suggested retail prices!

Admit it. You just felt a thrill.

Successful selling is often about controlling context. The New Yorker’s James Surowiecki describes the phenomenon of reference pricing, in which a store such as Kohl’s might mark a pair of jeans with a suggested retail price of $49.99, but then remark the tag as “on sale” for only $24.99 today. Consumers respond by looking at the first, higher price — the reference price — and get motivated because the second price conveys a “good deal.” What consumers don’t know is reference prices are usually fiction.

Why do people fall for such silly retail tricks? Consumers balance two motives — a desire to gather new resources, and a conflicting need to hold on to existing resources, sort of like cavemen and women trading hard-saved nuts for animal pelts back in the Ice Age. Reference prices give consumers the illusion they are getting more value in the exchange.

In the past, retailers held an advantage in that consumers did not have access to much information about prices. The old, stodgy 1960s “Four P’s” marketing model talked about product, price, place, promotion, with the inference that most consumption decisions are based on information buyers see at the point of purchase such as the store aisle. Four decades ago, most commerce was a physical, hand-to-hand transaction, so how marketers spun price, promotion and place really mattered.

The internet is revolutionizing marketing as consumers learn to peak behind the scenes at the pricing and quality of all the competitors. As consumers can compare everything quickly, manufacturers and designers are being forced to create better products. Autos are perhaps the best example; the information available from Consumer Reports and the internet on quality and safety means that a Honda built in 2007 is probably a better-structured car than a BMW built back in 1980. You don’t often see cars broken down by the side of the road anymore with steam coming out of the hood. Some of today’s current retailers, such as Apple, thrive on building products that are so good people will pay high margins, and not haggle on price.

Retailers still have many tricks to spur demand: Matching competitor prices, % off sales, limited-time only sales in which stores open at crazy hours. But maybe, as consumers get easier access to the internet, pricing strategies will continue to falter and retailers will have to make money the old fashioned way — by building better products.

Retail strategy for holiday shoppers: Minimize the burden of choice


Retailers get a splash of icy water today with Bloomberg reporting U.S. retail sales fell 4.4% in the week ending Dec. 1 vs. a year ago. With all the rumblings of housing crisis and looming recession, consumer confidence may be waning.

Which brings us to our favorite article on how to get shoppers to buy from you instead of your competitor. Researchers at MIT dug in to the psychology of shopping, running a series of tests to see how to get consumers to spend more or less than usual. In general, they found that influencing consumers early in their decision process is critical — because shoppers tend to start out with fuzzy goals and then get specific when they are about to make a choice.

For instance, consumers like to shop in huge malls with many stores, because when they begin to shop, they have a vague desire to purchase something but don’t know exactly what. When they arrive inside a mall or large retail store, they then must enter a second mode to grapple with the complexity of choice. Because managing complexity is difficult, consumers put blinders on — narrowing their vision to a subset of manageable options. Thus, you may be drawn to Wal-Mart because you like the huge selection, but once inside, you grab for a few specific items and then escape.

The researchers suggest the way to get consumers to buy more requires two steps: (1) Use some highly visible incentive to get consumers to come to your store vs. others, while their initial shopping mode is vague, and then (2) once a shopper is inside your store, seek to streamline and minimize the burden of choice. For example, a coupon is a good incentive to get a shopper to cross your doorway; but giving a consumer a coupon after they walk into the store complicates the decision process, and might actually depress sales. If you offer fewer options once the consumer is inside, he or she is likely to spend more.

Now we finally understand why we get a headache in Wal-Mart.

How far will consumers drive to find you?


About 9 in 10 U.S. consumers drive to work, logging 3.7 billion hours a year plowing through traffic. This means if you’re selling something, chances are consumers will find you by car.

So if you own a retail store, theater, or coffee shop, you need to plot where your customers may come from. The best summary of drive-zone strategy we’ve seen is in Directions Magazine, which points to four basic approaches: radial studies that put concentric rings around your location; gravity models which consider the magnetic power of competitors who may pull customers to them vs. you; drive-time analyzes which plot driving distances in minutes via real roads, accounting for barriers such as rivers etc.; and customer-level data using point-of-sale information, customer databases, or prospect databases to determine precise, address-level spatial forecasting of store trade areas. Sexy stuff, eh?

We’re plotting trade areas now for several clients (the smartest data so far coming from a regional theater), but the client we really want to help is a little deli-coffee shop in a Mobil station off I-84 exit 14 in central Connecticut. These guys make the best breakfast sandwich in the world, created by a local cop and called the “Killer Miller”: Two eggs, hot peppers, onions, cheese, salt and pepper, and hot sauce, on a lightly grilled bun. They probably can’t afford media planners, so here’s a little gift for them: Readers, if you live in the map area below, you’re only 20 minutes from the world’s greatest deli. Drive on in.

Velocity, impressions, and why she’s walking so fast


With all the talk about declines in print readership, we think understanding the quality of ad impressions is more important than ever before. Which reminds us of why you should never open a retail store next to a bank.

A while back, Malcolm Gladwell interviewed retail consultant Paco Underhill, who made the brilliant observation that pedestrians walk at different rates. Just like cars, people have a “human downshift” before they stop moving, and it takes a man or woman about 12 to 25 feet to completely stop from a brisk walk. This is why, Underhill said, you never want to set up retail next to a bank. People speed up as they walk past the bank, since there is nothing to look at, and by the time they slow down they’ve whipped right past your store.

Too often, media planners don’t consider human shift speeds. An impression is usually an impression, advertisers think, and so they focus on CPMs or GRPs to calculate which campaign plan will create the most imprints. Alas, the quality of the impression will vary wildly depending on the viewer’s velocity.

Consider — which impression is stronger, a TV spot in the evening when a consumer is relaxing, or one at 7:30 a.m. when she is rushing out the door? What would break through better, a black-and-white ad in the Pennysaver, where a consumer whips through each page scanning for coupons, or the same ad in a magazine, with the consumer slowly reading editorial next to it?

Just as all retail locations are not created equal, so, too, impressions have variance. In your next media plan, ask yourself — how fast will the consumer be moving when they see our beloved ad? And are we giving them enough time to slow down?

(Update: Neil Klar, chief of SQAD, has a fresh take on CPM effectiveness in Mediaweek.)