Digital Will Impact Retail Next Year

by Deepak Sharma on Thursday, December 25, 2008

Retail will be one of the trend areas and we will see more digital interactive solutions in Retail in the next year. IPG Emerging Media Labs identifies five trend areas to watch next year related to browsers, conversation, transmission, retail and consumer tech.

Even in the depths of a recession, interactive retail solutions will soar in 2009, IPG says. An online experience punctuated by smart signs, interactive mirrors, loyalty programs and other features is enhancing the consumers' and brands' ability to constantly be connected to the Web and each other by mobile phone. Google's mobile bar code reader Zxing enables photography and decoding of barcodes for more product data, and SnapNow provides price comparisons and peer ratings from

Such real-time shopping assistance is matched by audience measurement on sight in stores to provide more relevant target advertising that more likely results in a purchase.

Check this cool slide deck on what the future could be like for Retail.

Merry Christmas to you all :)

Hitting Home Run with a Viral

by Deepak Sharma on Sunday, December 21, 2008

JC Penney seems to have hit run with a very viral marketing campaign titled, Beware of the Doghouse. The campaign allows women to put their their significant other in the "Doghouse" for bad gift choices this holiday season. This new site and the marketing campaign behind it provide a fun, interactive way for women to encourage the men they love to get out of the “Doghouse,” by purchasing affordable diamond gifts from The Jewelry Store inside JCPenney. Not just that the campaign makes use of Facebook Connect application, which allows Facebook users to easily log into their account and select potential “Doghouse” candidates from their Facebook Friends list. The application also allows photo downloads from the profile pages and feeds stories from the site to the candidate’s Facebook Wall. The website and video has spread like wildfire over the web this past few weeks.

This is a great example of how Retailers are using Social Media and innovative marketing to connect with customers and generate sales.

Read more:

Retailers find Facebook friends in hopes of finding sales

Why JCPenney's 'The Doghouse' Went Viral

Google Focuses on Retail Basics

by Deepak Sharma on Saturday, December 20, 2008

eMarketer Article on how Google focuses on driving sales offline instead of online for Retailers.

“If you look at any retailer, maybe 92% of the revenue is coming from the brick-and-mortar channel, so the most important platform to make successful is driving people to a store,” Mr. McAteer said. “A small percentage of retailers’ spending is online, and the majority of their advertising dollars are still being spent offline.”

“Within 12 months, you’re going see a lot of retailers talking about how they are measuring in-store success from their online marketing, and it will open up a whole other way of looking at ROI from your dot-com spend,” Mr. McAteer said. “As smart retailers start to figure it out, they will probably shift more of their marketing dollars online.”

It’s not surprising for Google to suggest that online ad and marketing spending will increase, but marketers themselves tend to value online tactics highly.

Quote of the season

by Deepak Sharma on Monday, December 08, 2008

This quote by Abercrombie CEO, Michael Jeffries in an earnings call with analysts last month. I guess many retailers will feel the after effects of the markdowns this season in the coming 2-4 months.

“Promotions are a short-term solution with dreadful long-term effects.”

Read more in this WSJ story, Abercrombie Fights Discount Tide (Registration required). 

We hear your concerns," said Chairman and Chief Executive Michael Jeffries in an earnings call with analysts last month, but "promotions are a short-term solution with dreadful long-term effects." Marking down clothes now could lead to the brand being seen as something cheap, he explained.

Even in good times, Abercrombie has always shied away from big promotions, though it does try to clear out merchandise at the end of a season. The company's determination to keep prices high as the economy sours has already cost it dearly during the holiday season, which accounts for an estimated 30% of total teen retail sales.

Retail Weekly Roundup – 6

by Deepak Sharma on Saturday, December 06, 2008

With so many things to write about and not enough time, I am restarting the Retail Weekly Roundup posts. The posts will provide a view on how Retailers are using technology today.

How Retailers Can Benefit From Social Media

Shopping is an inherently social activity. Why, for instance, do people go to the mall? To buy things, of course. But also to walk around, meet friends, people-watch and socialize.
By contrast, shopping on the Internet has been a lonely and solitary experience, which may explain why the average e-commerce site has a paltry 3-percent conversion rate. That means 97 percent of people who go to an online retailer in search of a product never buy what they're looking for.
However, for some retailers, social media is proving to be a valuable tool for engaging consumers, driving sales and building customer loyalty like never before. By adding social media content and capabilities to their sites -- including ratings, reviews, recommendations, blogs, photo galleries and forums -- retailers are transforming their Web properties into online destinations with vibrant communities.

Willard Bishop: The Re-emergence of Service Pricing

The single most important challenge facing companies today is finding a path towards greater value creation. Historically, value resided in the products themselves. Manufacturers developed and marketed products, and there was little focus on services or high-end customer solutions. Today, a large component of value has migrated from the product itself to how the product is moved through to the consumer.

With a challenging economy and increasing supply costs, there is a reemerging interest by Walmart and other retailers to find ways to leverage the value chain to put even more distance between themselves and less efficient competitors. How companies are structured to extract profit from the value chain is becoming more important and is leading to a renewed interest in cost-to-serve and Service Pricing programs.

Stores Retail Deals – Some key ones below, click on link to read more.

Tomax and Revionics have entered into a strategic partnership to provide workforce optimization and price optimization solutions to grocery retailers.

Several online retailers, including Lands' End, ProFlowers, PacSun, RedEnvelope and BuyCostumes, have selected CitizenHawk as their digital brand management solutions provider.
New York-based wine retailer California Wine Merchants has launched its lower Manhattan retail store and e-commerce website, built and managed with CORESense’s Multi-Channel Retail Management Software solution.

Sherwin-Williams will be standardizing on SUSE Linux Enterprise point of service as the operating system for its retail store multi-function desktop/registers and in-store servers.

Personal Shopping Devices Preparing For Tipping Point In Adoption In 2009 [via Microsoft Retail & Hospitality Communique]

Personal shopping devices for consumers are reaching their “tipping point”. With Stop & Shop, a strong regional supermarket chain, signaling success with an initial test of its personal shopping device, experts say 2009 could be the beginning of the handheld era for grocery, warehouse clubs and pharmacies. Stop & Shop recently added to its new logo, color palette and employee uniforms, a handheld device, called Easyshop, which allows shoppers to scan, track and bag their groceries while they shop. The goal is larger basket size for grocery retailers, higher purchase goals for time-pressed shoppers, more total trips to the store, and higher coupon redemption rates. While the universe for consumer-facing handhelds for retail is still small, employee facing handhelds and consumer facing devices are ranked number two and three on the list of opportunities for improving the in-store experience.

10 Superstars of Retailing Beat the Downturn

As shoppers cut back on all but the most vital purchases in the economic downturn, some retailers have beat the odds and have discovered the winning formula for success. Ten retailers including BJ's, Walgreens and Hot Topic continue to post higher than expected financial results, announce store expansion plans and remain poised for future success as we enter 2009. RIS News highlights 10 surprisingly successful retailers that are surviving and thriving in one of the toughest economic climate in years.

Retailers Clueless About Mobile Barcode Scanning Apps

by Deepak Sharma has a story on how Retailers are unaware of Mobile Barcode Scanning Apps which provide instant price comparison and allow users to save money.

These apps allow consumers to compare the prices of merchandise on a store's shelf to competing stores in the area just by taking pictures with their smartphone's camera. The prices are instantly retrieved and displayed on the mobile phone so consumers can know before they buy if they're getting a good deal.

Although consumers may be catching on to this barcode-scanning trend, some stores are still in the dark. For example, a Target store in Michigan recently requested a shopper to stop scanning merchandise, saying it went against store policy. The customer reported the event to the application's makers, Big in Japan, whose app Shop Savvy is a popular download for Android handsets.

I have written about similar app for iPhone in the past. It is a great way to save money in these difficult times. If you are a retailer what would you do, encourage consumers using such application or deny them a chance to save money?

Black Friday Sales -2008

by Deepak Sharma on Tuesday, December 02, 2008

Shop Talk has good coverage of the Black Friday Sales which has been released by different agencies.

National Retail Federation: According its 2008 Black Friday Weekend survey, conducted by BIGresearch and published on Sunday, the NRF said more than 172 million shoppers visited stores and websites over Black Friday weekend (which includes Thursday, Friday, Saturday and projections for Sunday), up from 147 million shoppers last year. Shoppers spent an average of $372.57 this weekend, up 7.2 percent over last year’s $347.55. Total spending reached an estimated $41.0 billion, up from $34.6 billion a year ago.

ShopperTrak RCT’s National Retail Sales Estimate found sales on Black Friday and Saturday rose 1.9 percent from 2007 – with each day posting total sales of $10.6 billion and $6.0 billion, respectively. It said Saturday sales fell 0.8 percent compared with last year as most Black Friday promotions ended.  Sales on Saturday last year rose 5.4 percent over 2006, with $6.1 billion spent that day.  

On Monday, SpendingPulse, a data service provided by MasterCard Advisors, said sales at U.S. specialty apparel retailers rose 1.6 percent on Friday and Saturday from a year earlier, but sales at electronics specialty retailers fell 14.3 percent. Luxury retailers saw a 2.4 percent increase,  while e-commerce sales rose 11.8 percent, it said.

Other coverage here: Retailers Get a Brief Lift on Black Friday as Shoppers Look for Blockbuster Sales

MarketWatch: Black Friday doesn't a season make

Seeking Alpha: Retailers Will Find It Hard to Keep Shoppers' Attention This Year

Seeking Alpha: Quick Thoughts on Black Friday Retail

Media and Retailers Both Built Black Friday

by Deepak Sharma on Monday, December 01, 2008 has a thought provoking article on death by trampling of a temporary worker at Wal-Mart on the day of Black Friday. The article points out on how Retailers and Media are equal to blame for the death.

The willingness of people to walk over another human being to get at the right price tag raises the question of how they got that way in the first place. But in the search for the usual suspects and parceling of blame, the news media should include themselves.

Just a few days ago, the same newspaper writers and television anchors who are now wearily shaking their heads at the collective bankruptcy of our mass consumer culture were cheering all of it on.

Media and retail outfits are economic peas in a pod. Part of the reason that the Thanksgiving newspaper and local morning television show are stuffed with soft features about shopping frenzies is that they are stuffed in return with ads from retailers.

“Media outlets have been stride for stride with the retailers,” said Marshal Cohen, chief retail analyst for the NPD Group, a market research firm. Speaking on the phone on Friday evening after nearly 24 hours of working the malls, he suggested, “Something like this was bound to happen at some point. The man who died at Wal-Mart was, from what I understand, a temporary employee and had no idea what he was dealing with.”

What do you think of this? Are Retailers to blame for this debacle or Media for driving the madness.