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Retailers are adopting new strategies in targeting its loyal customers (WSJ, Registration reqd) by using Analytics and advertising promotions on an individual basis. This is a shift from earlier times when Retailers would send similar email promotion to all. Retailers like Sears, Gap, Target are using analytics to tap their most profitable customers and shying away from TV commercials

It's an adage of the business: Persuading a satisfied customer to return is cheaper than attracting a new one. Now, in the struggle to do more with less, that concept is becoming even more important.

Acquiring a new customer costs about five to seven times as much as maintaining a profitable relationship with an existing customer, says Marc Fleishhacker, managing director at WPP's Ogilvy Consulting, which designed the campaign for Sears.

…

Sears and Ogilvy have developed a system to identify the categories of merchandise Sears customers have purchased in the past and to measure the chance that they will buy those sorts of items again this season. That helps Sears determine the type of emails and point-of-sale offers to aim at individual customers.

When customers buy an item online, Sears confirms the purchase with an email including a promotion tied to that product. A person who buys a new appliance at Sears.com might get an email offering a deal on the store's extended-warranty program.

Retailers are planning for “Cyber Monday” by offering more deals & promotions online.

'Cyber Monday' Discounts Bloom - WSJ.com

Online retailers plan to offer more deals and promotions to spur holiday shopping on the Monday after Thanksgiving this year, according to a new study.

The survey, commissioned by Shop.org, a division of the National Retail Federation, says 83.7% of retailers will have special promotions on that day, known unofficially as "Cyber Monday," up from 72.2% a year ago. Of those promotions, one-off deals, email campaigns and one-day sales are expected to be popular.

Big News coming in this morning and it dampens the whole thing by coming just head of the holiday season.

Circuit City files for bankruptcy | U.S. | Reuters

Circuit City Stores Inc, the No. 2 U.S. consumer electronics retailer, filed for bankruptcy protection on Monday just a few weeks before the start of the key holiday shopping season, becoming the largest retailer to file under Chapter 11 this year.

Circuit City fell victim to tighter credit terms from vendors and a loss of market share to Best Buy Co, Wal-Mart Stores Inc and other rivals.

…

In a court filing on Monday, Chief Financial Officer Bruce Besanko said the retailer filed for Chapter 11 in order to continue its turnaround efforts.

"In large part, a Chapter 11 filing is due to three factors, all of which contributed to a liquidity crisis that prevented the company from completing its turnaround goals outside of formal proceedings: erosion of vendor confidence, decreased liquidity and a global economic crisis," Besanko said.

Service Oriented Architecture (SOA) allows you to leverage existing assets and manage the diversity and complexity within the Retailer’s organization. Using SOA, Retailers are building complex systems which can handle changes with minimal changes. Supermarket News is reporting on how in Texas, Retailers are using SOA to account for the tax break on school-related purchases which is an annual activity. The use of Services is making life easier by limiting changes. While the adoption of SOA has been slow in retail but over the last two years the speed of adoption has picked up. The Association of Retail Technology Standards (ARTS) is also supporting the SOA adoption by providing SOA Blueprint for Retail which provides step-by-step guide and best practices in attaching SOA.

SOA is an IT framework that a growing number of retailers — 56% of respondents in an ARTS survey — are beginning to explore, and that some regard as a potentially game-changing approach to the retail business.

“There's a higher SOA penetration in retail today than 24 months ago,” said Richard Mader, executive director of ARTS (the Association of Retail Technology Standards), a division of the National Retail Federation, Washington.

The importance of SOA is reflected in the attention it is being given by ARTS, which counts among its members such major food retailers as Kroger, Safeway and Publix. In January, ARTS unveiled an SOA Blueprint for Retail, the result of a project, co-chaired by Dorf, to give ARTS members a free step-by-step guide to adopting SOA, along with vendor-neutral best practices. (The Blueprint is available to non-members for $249.) ARTS has also made available — in some cases just to ARTS members, in other cases to anyone — some downloadable building blocks of SOA technology.

Amazon.com has launched Windowshop.com which enhances the shopper’s experience. The site provides a unique view by encouraging users to use the arrow keys on the keyboard to navigate the site. Shoppers can scroll through the items and zoom in which plays either video or audio related to the product. I found the site very appealing and fast and easy to use.

Bad news continue coming in.

Retailers Report a Sales Collapse - NYTimes.com

The remarkable slowdown hit luxury chains that sell $5,000 designer dresses as badly as stores that offer $18 packs of underwear, suggesting that consumers at all income levels are snapping their wallets shut.

Sales at Neiman Marcus, the luxury department store, dropped nearly 28 percent in October compared with the same month last year. Sales fell 20 percent at Abercrombie & Fitch, nearly 17 percent at Saks, 16 percent at Gap and nearly that much at Nordstrom.

Of the more than two dozen major retailers that reported on Thursday, most had sales declines at stores open at least a year, the majority of the decreases in double digits. Deep discounters like Wal-Mart and BJ’s Wholesale Club reported gains.

More here:

Retailers post worst October sales figures since at least 1971

Reality Check. Raises some very good questions on the nature of Retail Industry in India.

Retail industry? India does not have one really- Financial Times-Features-The Economic Times

Why should the customer go into a retail outlet and spend his hard earned money? Have our retail czars pondered over this problem? If the customer wants an air-conditioned environment then he can buy an air-conditioner and fix it at his house. Does he want all he would like to buy at one place? Is that the value of a shopping mall or large retail outlet? Well, for one thing, the builder of a mall or a retail outlet company can never guarantee that he will stock all the brands with him or even all the relevant brands with him. After leasing the building, it is the relationships that the mall or the retail outlet develops with various brands that determine the outcome of the outlet.

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The Online retail sales grew only 6% in the third quarter, the slowest growth on record for online sales, this according to a report from comScore Inc. Total U.S. online retail sales (excluding travel) were approximately $30 billion in Q3.

comScore, Inc. (Nasdaq: SCOR), a leader in measuring the digital world, today released its Q3 2008 retail e-commerce report, which showed that online spending grew 6 percent in Q3 2008 versus the same period last year, a slowdown compared to the year-over-year growth rates of 12 percent in Q1 and 13 percent in Q2 2008. Total U.S. online retail sales (excluding travel) were approximately $30 billion in Q3.

The Video Games, Consoles and Accessories remained the high – performer in line with the previous quarter.

As in the prior quarter, Video Games, Consoles & Accessories remains one of a handful of high-performing online retail categories, rising 60 percent in Q3 2008 versus the same quarter year ago. Furniture, Appliances & Equipment (up 52 percent) was another top performer, along with the Sport & Fitness category (up 40 percent). Categories that have not performed as well as last year include Apparel & Accessories (down 2 percent), Toys & Hobbies (down 3 percent), Jewelry & Watches (down 11 percent), and Music, Movies & Videos (down 29 percent).

                                                  Percent Change

    Product Category                           Q3 2008 vs. Year Ago

    Total Retail Category (Excludes Travel)               6%

    Video Games, Consoles & Accessories                  60%

    Furniture, Appliances & Equipment                    52%

    Sport & Fitness                                      40%

    Event Tickets                                        18%

    Flowers, Greetings & Misc. Gifts                     14%

    Home & Garden                                         6%

    Consumer Electronics (excluding PC Peripherals)       1%

    Computers, Peripherals & PDAs                         0%

    Apparel & Accessories                                -2%

    Toys & Hobbies                                       -3%

    Jewelry & Watches                                   -11%

    Music, Movies & Videos                              -29%

Very interesting news coming today from UK Online Retail Sales.

Online grocery sales outstrip electronic and gadget sales for the first time — Internet Retailing

Sales related to online supermarket shopping have outstripped electronic and gadget-related online sales for the first time since internet retailing began, according to statistics from MyVoucherCodes, the UK's largest free to use discount and voucher code website.

"Sales statistics from MyVoucherCodes have revealed that more people are now looking to find bargains on their essential items such as bread and milk and are being attracted to the online supermarket sites because of the exclusive offers and discounts on home delivery as well as shopping," says the company.

"The Top Four current online shopping sectors are; online grocery shopping with 31% of sales; 25% of sales for electronic items such as computers, TVs and gadgets; 21% of sales attributed to clothing and fashion items and 15% of sales related to holidays."

4,238 people from across the UK took part in the research which also revealed that:

• Tesco leads the way when it comes to the most popular online supermarket website with 44.2% of people saying they shopped there
• Asda had a 23.2% share, followed by Sainsbury's with 11.7% of market share. The rest of sales were spread between brands such as Waitrose, Ocado and Iceland.
• The average amount spent on online groceries was £53 per week.
• The north west is the region that uses online supermarkets the most, followed by the south east, London, south west and the north east.