Category Archives for "Retail Marketing"

3 On-line shopping — The best thing ever for MANkind.

Twenty five years ago I couldn’t imagine getting all my Christmas shopping done from the comfort of the man den. The idea of a world without malls was pure fantasy, right up there with that scene from Flashdance where Jennifer Beals dances in place until she’s raining sweat.

But today, it’s reality. Men really do have an alternative to the drudgery of shopping. It’s called e-commerce.caveman

For men, shopping harkens back to cro-Magnon days when we’d hunt down the things we NEEDED to survive. Men shop alone, in order to be more stealthy and less visible to people who might recognize us. We know what we want and we go out and get it… Essentials like tools, sporting goods and electronic gadgets. It’s a focused, goal-oriented, testosterone-producing activity. But only after the prize is in the bag.

Women go out in groups and gather things they might need someday, during an unusually hard winter. Frivolous stuff like bed skirts and duvet covers. It’s part of their natural, nesting instincts. They can happily browse for hours without buying anything, because shopping fulfills a physical need for women. Recent brain research is conclusive on this… An afternoon at the mall with friends produces oxytocin —  a chemical in the brain known as the cuddling hormone.

Googling “bargain jeans” just isn’t the same.

On-line shopping doesn’t offer the same psychological, sociological and even anthropological benefits that women get from traditional shopping trips. Let’s face it,  websites are more logical than they are intuitive. The whole on-line thing is more geared to the male brain than the female brain. It’s the nature of the beast.

Few on-line retailers establish the emotional connection women really need. Nancy F. Koehn, a professor at Harvard Business School who studies retailing and consumer habits, said that online shopping is more a chore than an escape. “It’s not like you think: ‘I’m a little depressed. I’ll go onto Amazon.com and get transported.”

Koehn said that while traditional retailers have made the in-person buying experience more pleasurable, online stores have continued to give shoppers a blasé experience.  Well guess what… Men don’t care! They’re not looking for an “experience,” they’re looking for a trophy on the wall.

The last thing men need is a true shopping “experience.” That’s what we’ve been trying to avoid all these years. That’s what we know as sitting outside the outlet mall waiting for the women to return after an hour and a half in the Dress Barn.

In better retail environments, lighting, store layout, background music, graphics and good customer service all work together to make shopping a pleasant, sensory experience that appeals to the emotional center of a women’s brain. It’s a real art.

Unfortunately, most on-line stores are slapped together about as well as a Mexican convenience store. If it weren’t for men, half of those sites would be out of business entirely.

According to Forrester Research, men spend more and take less time than women to make on-line purchases. And once a sale is made, men return only 10% of apparel purchases, while women return more than 20%. As to spending, another market research group found that men dropped an average of $2,400 online compared to women who spent closer to $1,500 in the same, three-month span.

Don’t quibble over price, just locate the target and make the kill. Get in get out.

Maybe that’s why I have such a hard time with sites that present a thousand random choices, right off the bat. Too many choices slows the decision-making process and leads to frustration for men. It’s like standing in the beer isle in an Oregon grocery store … there are so many choices of micro-brews it’s almost ridiculous. Ales, IPAs, Hefes, Lagers, Pilsners, Stouts, Browns and Ambers in a crazy array of packages from all over the world. It’s too much information.

That’s one reason men love brand name products, brand name stores, brand name sites and brand-name beer: We trust the brand to narrow the choices for us and provide some degree of quality control. (Anything from Deschutes Brewery is good.)

When I shop at REI, online or offline, I know I don’t have to wade through a bunch of crap before I find the quality products. It’s all good, because it’s REI. In the brick & mortar world, the choices are limited by the physical floor space. An REI shoe buyer has room for only so many different styles and prices points, so that’s all you get to choose from. There’s no such limitations in the on-line world.

Zappos claims to have 1,095 brands, 165,722 styles, 906,874 UPCs and 2,957,471 products. That might work for women who make shoe shopping a pseudo-profession, but guys want those choices narrowed down.

Forrester Research reports that 70 percent of online consumers research their purchases on-line, then buy off-line. This so-called “clicks-and-bricks” hybrid model is classic male behavior. But it’s not really shopping, it’s research.

So where’s it all going?

Less than four percent of all retail sales are currently made on-line — a reassuring stat for traditional retail businesses. If you have an e-commerce company, look at it this way… you’ve hardly scratched the surface.

If your product line and/or brand appeals to women you have to work hard to establish an emotional connection and emulate the mall experience as close as possible. But realize, e-commerce will never replace the real thing.

If your on-line store is more male-oriented your job’s a little easier. Keep your product selection focused — don’t try to be all things to all men. Offer brand name products and establish your own brand as a name to trust.

And give guys a way to avoid the mall altogether… they’ll reward you for it in the end.

2 retail marketing strategy

Retail Marketing Strategy — Super Sales vs. Super Brands.

It’s discount days in the retail world right now. Everywhere you turn there’s a super sale, an inventory reduction, a holiday clearance event or some other equally banal form of discounting.

retail marketing strategySign of the times, I suppose. With all that pressure from online retailers, brick and mortar store owners are desperate to get people in the door, even if it causes long-term damage to their brand.

But does discounting really hurt your brand?

That’s a question that often leads to heated debates between ad agency folks and their clients. The creatives are quick to condemn anything that involves a price point. But clients want to “move the needle” and “get an immediate ROI” on every advertising dollar. They often claim that any sort of “image” advertising is a waste of time.

Then there’s the agency Account Executive, trying desperately to bring the two sides together in a sort of middle-east peace accord that will save the account for another year. Not a good scenario for a lasting client-agency relationship. But I digress.

The question is, where does discounting fit into your retail marketing strategy? Does it hurt a brand to run a half-off sale?

It depends on the brand.

Before you hire that sign painter to emblazon your front window with “Everything Must Go!”  ask yourself two questions:

  1. Does the sale or promotion complement your brand promise or contradict it?
  2. Who would the sale appeal to? Are you luring only your best customers, or is a a good way to introduce new folks to your brand. And will you ever see those people again?

retail marketing strategyNordstrom has the right answer to both those questions.

When it comes to brand integrity, Nordstrom is the bellwether for the retail industry. It’s a chain known for high prices and bend-over-backward customer service.

Bargains are NOT part of the Nordstrom brand ethos. So yes, frequent discounting would definitely hurt that brand.

If Nordstrom had a Super Bowl sale and a Valentines Day sale and an Easter sale and a Mother’s Day sale like most department stores, consumers would slowly but surely begin to question the entire premise of the business. They’d begin to doubt Nordstrom’s stature as the industry’s service leader and wonder if the chain compromised the quality of the merchandise.

Might as well go to Macy’s.

So here’s how Nordstrom handles discounting without compromising their brand promise: They only have one store-wide sale a year: The Anniversary sale. Plus an annual Men’s Sale and an Annual Women’s Sale.

retail marketing strategyTo manage the inevitable department store inventory challenges and discounting pressure, they opened The Nordstrom Rack. If you like Nordstrom’s outstanding merchandise, but don’t want to pay standard Nordstrom prices for the service, go to the Rack. It’s like a sale all the time. Same stuff, but a totally different shopping experience.

So here’s the final answer: If you have a retail brand that emphasizes customer service and outstanding quality, use discounts very sparingly. Because every sale will send mixed messages to an already skeptical audience.

Contrast that with Wal-Mart. Wal-Mart shoppers aren’t going to Nordstrom for the annual men’s sale. They’re going to Wal-Mart every Saturday where a constant barrage of markdowns is always expected, and perfectly “on brand.”

Wal-Mart’s corporate culture takes frugality to an entirely new level, and it shows up on every isle in every store. Wal-Mart’s brand promise demands big, loud sales, or at least the perception of sale prices all the time. That’s why they have spend more than $800 million a year on advertising… it’s a constant state of “Sale.”

For both Wal-Mart and Nordstrom, the retail marketing strategy delivers on the brand promise. Their sales appeal to core customers as well as those who are looking for a bargain. And there’s a good chance they’ll come back again after the sale.

Unfortunately, most business owners can’t answer the question, “is this sale consistent with your brand promise?” Because they don’t know what their brand promise is. When pressed, they can’t pinpoint what their business is really all about, beyond making their quarterly numbers.

They’ve never thought about it. They’ve never articulated it. And they certainly haven’t communicated it to the public in a clear, compelling, consistent manner. They’re too busy advertising “value.”

The Gallup Organization has done extensive research regarding brand promises and have found that the vast majority are poorly defined and poorly communicated.

retail marketing strategy

Sometimes it takes nerve to resist the “big sale” temptation.

“Rather than attempting to convince a skeptical audience that their brand offers something truly meaningful and distinct, some companies have found it easier just to bribe their prospects (with sales) … Repeat purchases that are driven solely by brand bribery, however, are not the same thing as a brand relationship.”

In other words, sales might increase short-term transactions, but they don’t improve your brand loyalty.

Successful brands like Nordstrom have lasting, loving relationships with their customers, not one-night stands. And the more Amazon pushes its automated, efficient-but-impersonal approach to retail, the more valuable Nordstrom-like service becomes.

So think twice about your retail promotional strategy. If your brand’s promise is to consistently deliver the cheapest goods and services in your category, then go ahead. Run sales every month. But if your brand promise is to deliver value or service or anything else beyond low price, then find another way to drive traffic.

Your brand will be better for it.

marketing strategy BNBranding

 

 

 

For more on how to differentiate your store without resorting to bribery, try this post. 

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