Retail (Bán lẻ) 2013

RETAIL – BÁN LẺ
hoangnd@msn. com
duchoang@cmc. com. vn
+849-0484-5459
Mar 2013 – V1. 0
Updated: 30/03/2013

Table of Contents
What's In Store: Retail's Stealth Trend ....................................................................................... 4
Three Important Retail Trends for 2013 ..................................................................................... 6
Mobile..................................................................................................................................... 6
Integration .............................................................................................................................. 6
More and More Social ............................................................................................................ 7
What's In Store: How Polyvore's Stylish Social Commerce Is Cracking Retail 3. 0 ..................... 8
Walmart Vs. Amazon: It's About To Get Interesting...................................................................10
Retail Wisdom: Lessons Learned From Holiday 2012 ...............................................................11
Forget the calendar – it’s not a crystal ball .............................................................................11
Thanksgiving hours don’t guarantee more sales ....................................................................11
Focus on the merchandise ....................................................................................................11
Leverage the Internet for all it’s worth ....................................................................................11
Holiday Shopping: The Retail Race Is On .................................................................................13
New "Service" Vernacular: Do You Speak It?............................................................................14
HIGH-TECH SERVICE ..........................................................................................................14
ACCESSIBLE SELF-SERVICE .............................................................................................14
CONCIERGE SERVICE ........................................................................................................14
CUSTOMIZED, HELPFUL SERVICE ....................................................................................15
THOUGHTFUL SERVICE .....................................................................................................15
SERVICE ANYWAY THEY WANT IT ....................................................................................15
Channel Blurring On Steroids....................................................................................................16
London Retail Dazzles: Between the Jubilee & Olympics ..........................................................17
2012: The Year of "Moving On" .................................................................................................18
BIG, BOLD, AUDACIOUS SPACES ......................................................................................18
VIRTUAL STORES POPPING UP.........................................................................................18
EXTREME COUPONING ......................................................................................................18
DEPARTMENT STORES TANTALIZE AFFLUENT SHOPPERS ..........................................18
Nordstrom Moves To The Land of Retail Opportunity................................................................20
Power Couple: Walgreens & Alliance Boots Build Cross-Pond Empire .....................................21
Will JC Penney Shoppers Accompany The Retailer To The Finish Line? ..................................23
Are Retailers Cannibalizing Black Friday?.................................................................................25

1 | Page hoangnd@msn. com Mar 2013

Are You Really Getting A Bargain Black Friday Deal?...............................................................27
Why Retailers Have to Open on Thanksgiving This Year ..........................................................29
With Thanks giving - Night Openings, Do Retailers Risk Busting More Than Doors? ................31
Retailers, Can You Hear Us Now? ............................................................................................33
Retailers: Who Do You Trust?...................................................................................................34
Retail's Big Question: Is The Price Right? .................................................................................36
Pricing Part 2 -- Focus On Specialty & Vertically Integrated Retailers .......................................38
Getting the Price Right from the Start ....................................................................................39
Pricing Part 3: How Does A Brand Know When The Price Is Right? .........................................40
So how does a brand set the entry price for a new product? .................................................40
Department Store Pricing -- No Easy Task (Part 4 Of 4) ...........................................................43
High Fashion Specialty Stores ...............................................................................................43
Mid-Level Department Stores ................................................................................................44
Stores for Price-Sensitive Consumers ...................................................................................45
Conclusion ............................................................................................................................46
How Fashion Brands Set Prices ................................................................................................47
1. Market Product Opportunity Analysis: ................................................................................48
2. Define Strategic Brand Position: ........................................................................................49
3. Wholesale Price:................................................................................................................51
4. Product Development: .......................................................................................................52
Why do dresses cost more on a designer's website? ................................................................54
2. 1. Conflicting Priorities Destroy Feedback Loop:................................................................54
2. 2. High Subjectivity and Large Biases Adversely Impacting the Comparative Pricing
Analysis: ................................................................................................................................56
2. 3 Supporting Legacy Revenue Channels with Conflicting Agendas ...................................57
2. 4. Emotional Engagement Drives Pricing Power: ...............................................................60
The Future Of Fashion Retailing: Part 1 - Uniqlo .......................................................................62
Uniqlo: Choosing Long-Term Appeal over Trends .................................................................62
The Future Of Fashion Retailing: The Zara Approach (Part 2 of 3) ...........................................64
Zara: Responding to Consumer Trends .................................................................................64
How is Zara able to do this? By being fast and flexible. .........................................................64
The Future Of Fashion Retailing -- The H&M Approach (Part 3 of 3) ........................................66
H&M: Building a Bridge between Timeless and Trendy .........................................................66
Three Different Approaches, Important Common Ground ......................................................67
Uniqlo: How Japanese Billionaire Tadashi Yanai Plans To Clothe America ..............................68
Are Retailers Reaching Consumers Of The New Millennium? ...................................................70
What Is The Kryptonite Of The Millennial Generation? ..............................................................72
History Repeats .....................................................................................................................72
History vs. Trivia ....................................................................................................................73
A Well-Read Mind .................................................................................................................73


Why You Should Be Hiring Millennials [Infographic] ..................................................................74
What Millennials Want Most: A Career That Actually Matters ....................................................78
Postscript On Retail Pricing: Avoiding The "Race To The Bottom" ............................................80
Who Owns Pricing? ...............................................................................................................80
Is Anyone Selling at Full Price? .............................................................................................81
What is a Product Really Worth? ...........................................................................................81
Offering a distinct, differentiated product. ..............................................................................82
Staying true to who they are as a brand. ...............................................................................82
Pricing Wars Make A 'Punch And Judy' Show Of Retailing: Running For Higher Ground ..........83
Did The JC Penney ‘Fair and Square’ Promise Offer Salvation? ...........................................83
Dynamic Pricing ....................................................................................................................84
Personalized Pricing ..............................................................................................................84
What Can Be Done?..............................................................................................................84
JCPenney Returns To High-Low Pricing, Cue The Critics .........................................................86
J.C. Penney Tweaks (Again) Its Radical Pricing Strategy, Which Continues to Sink Sales..........87
The Winners (Target) And Losers (Best Buy) This Holiday Season............................................91
Retailers Fight Back Against Amazon With Private Brands .......................................................96
Wal-Mart Nimble? Pricing and Shipping Moves Suggest New Competitive Zeal; Stock Rising 100


What's In Store: Retail's Stealth
Trend
“Few purchases are made – either online or offline
– without some type of digital research. Retailers
are telling us that over 90% of their purchases are
now digitally assisted. ” That’s the observation of
Lelah Manz, chief e-commerce strategist at
Akamai. You may not have heard of the cloud
platform but you definitely know its customers.
Akamai works with the likes of global retailers
including Dolce & Gabbana, Best Buy, Victoria
Secret and leading flash sale site Hautelook and
tracking retail traffic based on its Retail Net Usage
Index.
As analysts, brand managers and store owners (not to mention yours truly) try to tease out the
trends that will convert browsers to buyers in 2013, Manz took a moment to talk to FORBES
about an often overlooked, but critically important, part of the shopping experience: search.
Think about it. You want a TV. Or a pair of shoes. Or a toy for your toddler. Do you get in your
car and drive to the nearest strip mall? Chances are you’re sitting at your computer, or on your
smartphone, and you just type in the name of the product and let the research and reviews pour
in. Or you’re actually in a store, staring at an array of similar products and whip out your
smartphone and voila. Comparison pricing, often tagged to your location, pops up in seconds.
Hello, showrooming!
Manz says search engines, with Google in particular, are still the number one choice for
accessing product information. “One study suggests that as much as 80% of referrals – a
referral is a site that shoppers link off of to get to an e-commerce site – is coming from Google
search, ” she tells FORBES.
The growth in mobile also delivers a plethor of new shopping tools that bypass Google entirely,
Manz notes, such as Apple iOS’s voice search Siri. “Red Laser is just one example of a price
comparison scanning tools that allow shoppers to scan a UPC label, or a QR code, with their
smartphone’s camera, returning a list of different online price points for that product. The search
engine Milo offers price comparisons and inventory information for products to be found locally
in stores, ” she adds.
Don’t forget Amazon. The online merchant’s massive database of product information and
consumer reviews provides a natural starting point for many a search, says Manz, noting that a
recent Forrester survey suggested Amazon may be taking traffic away from search engines
when it comes to starting the purchasing process. The findings indicate that 30% of U. S. adults
now start their purchasing journey on Amazon, while those starting on a search engine like
Google declined to 13% in 2012, down from 24% in 2011.
Manz says the difference may be in consumer perception. “If you type into the address bar of
your browser “Macys” instead of www. macys. com, behind the scenes that browser is using a
search engine – most often Google as the default – to take you to a set of search results that
includes as the top listing www. macys. com, ” she explains. “As a shopper you are likely not
really thinking about that activity as a Google search, and arguably there was very little
influence that Google search had in influencing your purchasing decisions in that case. But
retailers do see and count this as a Google referral. ”
Manz believes the influence of Google-as-a-Navigation-Tool has on referral statistics is
debatable, but it’s clear that this type of activity has a very different level of influence on the
consumer’s decision. “The power of influence in Amazon’s reviews and pricing information,
however, is indisputable, ” she asserts.


http: //www. forbes. com/sites/lydiadishman/2012/12/21/whats-in-store-retails-stealth-trend/


Three Important Retail Trends for
2013

Even as the cash registers and virtual shopping carts continue to rack up holiday sales for
retailers, savvy merchants are casting a critical eye into their crystal balls to determine how their
customers will shop in 2013. This is important, as theNational Retail Federation (NRF) points
out that with retailers operating more than 3. 6 million U. S. establishments that contribute $2. 5
trillion to the annual GDP, what happens in stores and online is “a daily barometer for the
nation’s economy. ” Good thing Kiplinger predicts that next year will herald better times,
especially in the second half of 2013.
FORBES gathered some forecasts, surveys and expert comments to see what may be in store
for retailers after January 1.

Mobile
Susan Reda, executive editor of STORES Media, writes, “The year just concluding will be
remembered as the one in which mobile became embedded into the lives of consumers — and
thus into the hearts of retail businesses large and small. ”
Mobile developers agree. According to a survey by Appcelerator and IDC , 93 percent of mobile
developers anticipate that it is “likely to very likely” that most retail companies will have enabled
mobile commerce in 2013 as consumers increasingly reach for their phones and tablets even
while shopping in a physical store. Consumer behavior continues to underscore this
transformation. Appcelerator found that nearly two-thirds of developers also believe that
consumers will make more purchases via their mobile phone than their credit card in 2013.

Integration
Founder of the direct-to-consumer shoe merchant Sole Society Brett Markinson tells
FORBES the “emerging” direct-to-consumer E-commerce model recently being discussed as
the “Next Big Thing” is only the beginning of the evolution pushing haute couture into the digital
age. “Building and distributing a successful brand in the Internet era is about addressing the
new behaviors of an evolving customer base by leveraging the changing landscape and its new
dynamics, ” he says.
Markinson believes the discussion has to shift from e-commerce vs. offline commerce to
integrated commerce. “The consumer does not distinguish. They want to buy cute, on-trend
products at great values wherever they happen to be. They want to engage with cool brands
that understand their interests and proclivities. The DNA of the web must be an intimate part of
the fashion brands of the future.
Those retailers who find a way to integrate will have a “killer brand. ” Says Markinson, “One
needs to be where the customer is, with both your messaging and your product. If you haven’t


already noticed, consumers today are both online and offline, and sometimes both–online while
shopping offline. Online they are sharing, friend validating, researching, learning and developing
a point of view. Offline there is touching, brand comparing and brand associating. All of this
drives the brand of the future. Finding the formula to leverage that online/offline dynamic is
critical. ”

More and More Social
RichRelevance, a company that powers personalized e-commerce experiences released some
interesting findings about social media’s role in retail. Namely, traffic from Pinterest has doubled
in the last year while Facebook saw its share decline to just 90% (from 95% in 2011).
Rich Relevance’s chief marketing officer Diane Kegley tells FORBES, “We believe that social is
going to have an increasing impact in 2013. We feel that the role of social media is to generate
awareness, not direct sales. While traffic referred from social networks is low – less than . 5%
according to our data – it has grown 30% year-over-year. ”
Kegley notes that retailers are getting smarter about how to use the social channels to generate
customer “delight. ” She points out how Target recently awarded gift cards to a number of
customers who were tweeting about them over the Thanksgiving holiday weekend. “Social
media is one element in [retailers’] arsenal of developing brand awareness across multiple
channels. All of these elements, including social media, shape or form the way that a consumer
hears about a brand or offering. This contributes not only to awareness, but actual product
decisions. ”
http: //www. forbes. com/sites/lydiadishman/2012/12/17/three-important-retail-trends-for-2013/


What's In Store: How Polyvore's
Stylish Social Commerce Is
Cracking Retail 3. 0

It’s a dilemma that’s dogged retailers since the days of the general store: how to help customers
discover new items and keep them coming back for more. In an era where e-commerce and
social media is continuing to blur the transaction line, the solution is as easy to pinpoint as a
moving target. But Polyvore is handily cracking the code of commerce 3. 0.
Though it’s not a retailer, as the largest fashion community on the web, five-year old Polyvore is
easily straddling the intersection of style and social commerce. 20 million unique
visitors discover the site each month and create over 2. 4 million “sets” or collages of products
that range from branded apparel and accessories to nail polish and home furnishings.
Polyvore’s co-founder Pasha Sadri says those sets generate “millions of data points on style
and taste. Polyvore then uses the data to drive its algorithms for search ranking and product
recommendations, Sadri noted in a statement.
But Polyvore’s massive army of style devotees isn’t just playing virtual dress up. They are
turning those 7. 5 billion product views into real spending. New data released by the company
yesterday indicates that the average order size from Polyvore visitors is $220. On Black Friday,
the average Polyvore shopping cart was 50% higher than the average for an apparel retailer. It’s
also a leader in the luxury market, boasting seven of its top 10 retailers who are major players in
the space such as Neiman Marcus and Net-a-Porter. (Think: the biggest order ever was for $67,
315). All this has translated into a 2. 3x revenue increase for the profitable Polyvore.
Speaking of revenue generation, Polyvore’s successful model is due in part to affiliate marketing
links, in which the platform receives compensation each time a user clicks through from a
product to a retail or brand page. Users tend to click on items they are really interested in
learning more about and/or actually buying so it’s extremely important for the platform to ensure
a smooth transition. On Polyvore, clicking a pair of pumps in a set on party style for example,
takes you to a product page and one more click leads to a purchase page.
The company’s recently hired chief revenue officer, Arnie Gullov-Singh, former CEO of Adly, a
marketing platform on Twitter, understands the importance of providing a seamless experience.
He tells FORBES that in order to keep those links at their clickable best, part of Polyvore’s
engineering team is dedicated to data quality. “They are constantly working to ensure that
products on the site link back to the correct e-commerce site and that those links are affiliatized


without interfering with the user experience. User experience is our number one priority, ” says
Gullov-Singh.
Another factor is ease of sharing. Of the one billion monthly set impressions, 43% are on social
networks, according to company findings. Pinterest leads the Polyvore pack, Gullov-Singh says,
because the visual nature of photo-sharing platform makes it a natural for shares and click-
throughs. “It’s design allows people to scan lots of images very quickly. That’s great for image-
heavy sites like Polyvore and e-commerce retailers, ” he says. “We’ve found that Polyvore sets
shared to Pinterest get 18x as many views and 2x as many clicks as sets shared to Facebook.
Tumblr is also very visual but the user interface is less optimized for fast consumption, ” adds
Gullov-Singh.
Though he’s staying mum on Polyvore’s projected growth for the coming year, Gullov Singh
says he’s excited for 2013. “What’s exciting aboutPolyvore is that it’s a fast growing social
platform that actually drives sales of products for brands and retailers. That’s rare to find in
today’s social media landscape and its what attracted me to join the company. ”
http: //www. forbes. com/sites/lydiadishman/2012/12/21/whats-in-store-how-polyvores-stylish-
social-commerce-is-cracking-retail-3-0/


Walmart Vs. Amazon: It's About
To Get Interesting

(Image credit: AFP/Getty Images via @daylife)
In the case of Walmart Vs. Amazon, it’s about to get interesting.
Let’s put aside the much discussednews leak that Walmart is considering using its own
shoppers as delivery people, providing some kind of incentive to drop off online orders on their
way home from the store.
It’s not likely to happen, there are far too many unattractive variables. But it shows the retailer is
thinking outside of the box when it comes to competing with its online competition, Amazon.
Walmart already offers in-store pick up and just expanded its test of a locker system where
shoppers can order online and pick-up in the store without waiting in line. It’s similar
to Amazon’s recent deal with Staples and 7-Eleven to do the same.
The big box behemoth may not be a start-up, but it does try to think like one with its Walmart
Labs division. That group is developing Pangaea, a global technology platform, scan and go
apps that let shoppers buy in store via a smartphone, and online operations in growing markets
outside the U. S. such as Brazil and China.
Wal-Mart is still testing same-day delivery in four cities. The program uses stores as fulfillment
centers and if expanded, could turn 4, 000 stores into bases for same day delivery.
According to Internet Retailer, Walmart is the fourth largest e-commerce retailer and expects to
generate $9 billion in global e-commerce revenue in its current fiscal year, ending Jan. 31,
2014.
Compared to Amazon, that $9 billion is pocket money. Amazon’s sales for the fourth quarter
alone were $21. 27 billion.
But take a look at the profits and some other key indicators. Income is slowing, expenditures are
up and there’s an Marketplace Fairness Act on its way to force the collection of state sales tax.
Sooner or later, people will start to notice the lack of earnings.
Amazon is building out a physical infrastructure to provide same day delivery, it doesn’t have
Walmart’s existing store base to work from.
It’s too early to call a winner in the retail race. Maybe there’s room for both, although they don’t
think so. In the case of Walmart Vs. Amazon, it’s about to get interesting.
http: //www. forbes. com/sites/lauraheller/2013/03/29/walmart-vs-amazon-its-about-to-get-
interesting/


Retail Wisdom: Lessons Learned
From Holiday 2012
The post-holiday haze has lifted, leaving much head scratching and gnashing of teeth about
what happened and why. Most agree it was an imperfect retail season. Sales results were
reported up 3 percent versus 2011, reflecting a season that was “peak-ed” to say the least. And
while final profit margins have yet to be released, they likely won’t bring better news.
So rather than succumb to a post-season, mid-winter funk, we may as well make the best of the
2012 holiday season. Lessons abound, after all.

Forget the calendar – it’s not a crystal ball
It’s time for retailers to stop using the calendar as a predictor. More shopping days between
Thanksgiving and Christmas no longer mean more sales. Shoppers were very stressed by the
end of 2012, and between the economy, fighting in Congress, Hurricane Sandy and life in
general, they had good reason to be. Extra shopping days proved exhausting for many.

Thanksgiving hours don’t guarantee more sales
Opening stores on Thanksgiving Day didn’t necessarily translate to more sales either. It may
have provided more people with jobs (good news), and got others off the couch before they ate
their third portion of turkey (a good health trend!), but that’s it. And Black Friday isn’t what it
used to be – it has become more media event and family entertainment activity than a major
indicator or driver of the season’s sales.

Photo credit: Wikipedia

Focus on the merchandise
Retailers that offered innovative, relevant and good-value gifts made the sales (Urban Outfitters
is a prime example). If there was nothing exciting to buy shoppers didn’t feel compelled to, or
bought gift cards instead (one of the success stories of the season). Today’s shoppers didn’t
feel pressured to buy just anything because it was the holidays. And, as 80% of US shoppers
still believe “their” recession will last 3+ years (How America Shops® 2012 Megatrends), their
focus on value is not over by any means.

Leverage the Internet for all it’s worth
The Internet became the great disrupter of the season, more so than in previous years. It
enabled people to start shopping earlier, be better prepared by checking out pricing and deals
online whether they planned to shop in stores or digitally). It also made the easily overwhelming
season less stressful to manage. The outcome was that the many traditional retailers who


smartly and creatively leveraged their bricks and clicks, omni-channel, approach were more
successful than those that did not (Macy’s and Nordstrom were good examples).
So, don’t blame a disappointing holiday season on the Fiscal Cliff, Hurricane Sandy or the
calendar. Like everything else in retail today, the world of shoppers and shopping has changed,
and this was never more evident than in 2012.
http: //www. forbes. com/sites/wendyliebmann/2013/01/29/retail-wisdom-lessons-learned-from-
holiday-2012/


Holiday Shopping: The Retail Race
Is On

(Photo credit: Wikipedia)
By the time we get to December 25 we will have learned much about the economics of this
2012 season. There has been much discussion about the merits of opening stores earlier this
holiday shopping season. When Walmart, Target, Best Buy, Toys R Us and others
announced their earlier Thanksgiving hours, questions arose as to the appropriateness:
Shouldn’t Thanksgiving be sacrosanct? Is it fair to ask employees to work when they should be
home? Is it right to encourage people to shop instead of spending time with family, eating and
watching football?
The only way to answer these questions is to abide by our everyday mantra and “follow the
shoppers” — let them lead us. And they did.
Here’s what we found: Holidays are about family and fun — and shopping. We saw shoppers
lined up in hundreds – especially outside big box stores and outlet malls – waiting for them to
open. There were families and friends. They were happy, excited, eager to be first for door
buster deals, especially those for flat screen TVs, computers, or the “toy” of the moment,
tablets. Sure, some had a gift list; others just wanted something for themselves; and still others
pre-planned, checking prices before lining up. But most came for the pure sport of it, to feel like
a winner, and for the anticipation of Santa in the air.
How will the rest of the season measure up now that the thrill of the Thanksgiving/Black Friday
hunt has passed? Our research finds that nearly half of Americans (46%) will do their shopping
between November 26 and December 17, while nearly a quarter of shoppers (23%) will wait
until the week before Christmas to get their gifting done. For retailers, this means that holiday
sales opportunities are far from over. So where will the shopper lead us next? Stay tuned…
http: //www. forbes. com/sites/wendyliebmann/2012/12/11/holiday-shopping-the-retail-race-is-
on/


New "Service" Vernacular: Do You
Speak It?

In a world where there are so many shopping choices — and always a cheaper, more
convenient or more intriguing option — “service” delivered in 21st century fashion is what can
build or destroy your relationship with your shoppers. Everyday, but especially during this
holiday season.
How do shoppers value ‘service’ today? It’s more than just making it easy for them to find what
they want, when they want it. Today, great service is also about anticipating what they don’t
even know they want and understanding in which categories and shopping moments they want
a “high touch” experience, or when they just want to get in and get out.
It all came into focus on a recent trip to Seattle, WA.

HIGH-TECH SERVICE
I began my trip by activating my new MapQuest app to plot the journey. [New-age service. ] It
took a minute to figure out how to use the app. (In case you haven’t heard, you can no longer
use GoogleMaps on the new Apple iPhone5. Bad Apple service… But that’s another story. )
MapQuest efficiently talked me to Seattle’s new City Target store. [Friendly high-tech service. ]

ACCESSIBLE SELF-SERVICE
Target’s new three-story urban format doesn’t have lots of live bodies in the store, however, it
does offer good (self) service. The store is easy to navigate for urban shoppers on-the-go, has
personal service where it’s required (pharmacy, electronics) and lots of good signing and
information when “people” service is unnecessary.
There are two entrances for easy access. The entrance on the main floor has a big friendly “Hi
Seattle” on the wall to greet shoppers as they enter and walk through women’s apparel, baby,
health and beauty, and pharmacy departments. The second entrance is conveniently located
below street level at the supermarket (which allows for quick in-and-out grocery shopping).

CONCIERGE SERVICE
At Nordstrom’s flagship store, old fashioned service is expertly delivered by the concierge, who
makes shoppers feel welcome and well-cared for. She answered every question: “Where’s the
Men’s department?” “Where can I get a snack?” “Where’s the ladies’ room?” “And by the way,


where did you get those fabulous shoes?” Nothing was a trouble. Later, when the concierge
spotted me about to exit the store with hands full of shopping bags she asked, “Do you need
any help?“ She then walked me out of the store and directed her back to the hotel. Her last word
of advice “Don’t forget to try our Nordstrom app. It will make your shopping easy, let you see
what events we have coming up. And you can download it for free. ” [Old world service meets
new world service]

CUSTOMIZED, HELPFUL SERVICE
Last stop, Starbucks’ new Evolution Fresh store that sells healthy, fresh-squeezed juices and
food. You can order a range of fresh-squeezed exotic juices like “Coconut Zen” juice (coconut
water, pineapple and cucumber, 50 calories, in an 8 oz. glass for $4. 99) or “Sweet Burn” (with
coconut water, pineapple, apple, beet, cayenne and ginger, 80 calories). You can order juices
“your way” from Juices on Tap presented like beers on tap.
The service is pleasant, knowledgeable without being too pushy or too preachy. The signing is
bold, clear, with dramatically changing wall images that tell the healthy story using wonderful
pictures of colorful fruits and vegetables. It’s easy to select what you want once you get used to
the process. You can have your drinks your way or theirs. You can stay and drink or take it
home. [Good execution of customized service. ]

THOUGHTFUL SERVICE
After a refreshing juice to bolster my spirits, I headed back to the hotel for a quick workout —
but realized I’d forgotten my sneakers. Saved! The Westin chain now offers Workout Gear, a
program in conjunction with New Balance fitness wear. If you like to travel light (or forget to
bring your exercise gear) Westin and New Balance have a solution. They offer guests fitness
wear (sweats, socks and sneakers) to use for the length of their stay for only $5. 00. For most
business travelers that’s a great deal. Even more rewarding is the fact that the hotel recognized
the need and satisfied it. [Thoughtful service. ]

SERVICE ANYWAY THEY WANT IT
You get the picture. Sometimes good service is delivered by a person, in person — but not
always. Today, it’s all about “servicing” customers, making it easy for them to find what
they want, when they want it, on their terms. While a well-trained professional certainly
makes for special add-on value that’s not what every shopper wants, every time she or he
shops.
The beauty of today’s shopping world is that we now have the tools to understand who our
shoppers are, what they need and want, when and how, so we can customize service
accordingly. In the end, it’s all service. Anyone can offer it, regardless of category, price point or
retail format. The fact is, everyone must.
http: //www. forbes. com/sites/wendyliebmann/2012/11/15/new-service-vernacular-do-you-
speak-it/


Channel Blurring On Steroids

The wall between prestige and mass retailers continues to crumble. Luxury retailer Neiman
Marcus and trendy big box Target announced a partnership to launch The Target + Neiman
Marcus Holiday Collection this December. The limited-time collection will include products from
24 well-known fashion designers, including Marc Jacobs, Oscar de la Renta, Diane Von
Furstenberg, Derek Lam, Rodarte and Tory Burch. The collection will feature some 50 products
in women’s, men’s, children’s apparel and accessories, home, pets, electronics accessories and
sporting goods. It will be featured in all Target and Neiman Marcus stores, and on both retailers’
websites. The collection will be merchandised together in a single shop-within-a shop format in
both retailers.
The big question for shoppers: how quickly will the merchandise sell through? If last year’s
Target program with Italian designer Missoni is any indication, we should all hold our place in
line (or online) right now.
Three days after the NM – Target announcement, Seattle-based department store retailer
Nordstrom and UK fast fashion retailer Topshop announced that Topshop and Topman would
be sold (initially) in 14 Nordstrom stores beginning this September.
Topshop is recognized for bringing runway trends to its retail stores in a fashion-minute. Unlike
other fast fashion retailers, such as H&M and Zara, Topshop has a wider range of: price points,
quality merchandise and categories (including collectable vintage fashion and beauty).
This isn’t the first time Topshop has developed a relationship with a department store retailer. In
the UK, in addition to its own stores, it’s sold in Selfridges and in Canada in The Bay.
The relationship with Nordstrom will help Topshop, currently with only three stores in the U. S. ,
grow its U. S. business faster. For Nordstrom, there’s the benefit of bringing new fashion into
stores every week and, in so doing, attract younger and more fashion-forward shoppers.
Beyond the “official” reasons for the Nordstrom-Topshop and Neiman Marcus-Target
collaborations, the real reason is that this is the way shoppers buy today. Shoppers around the
world are no longer willing to deal with the barriers of price point or the delay from runway to
store. They shop with a “high-low, ” “want it now” approach, and expect retailers to deliver.
Retailers are finally beginning to recognize that – so, expect the blurring to continue.
http: //www. forbes. com/sites/wendyliebmann/2012/10/09/channel-blurring-on-steroids/


London Retail Dazzles: Between
the Jubilee & Olympics
London has always known how to throw a party. But with this summer’s convergence of
celebrations for both Queen Elizabeth II’s Jubilee and the Olympics, London retailers are truly
making the most of their moment – and giving the rest of the world an “Olympic”-sized dose of
retail inspiration.
UK retailers are creating all manner of enticements for locals and foreign visitors alike.
Department stores Selfridges, Harrods, Harvey Nichols, andLiberty of London are
emblazoned with enticing brands and unique promotions. Anticipating the crush of shoppers
for Gucci products, Harrods had set up a “shopping line” on the pavement, “Gucci Queue Starts
Here” (a la the velvet rope at a night club). And on a kitsch note, home retailer OKA has
illustrated pictures of corgi dogs (the Queen’s dogs) on its windows.
To add to the excitement, new stores are opening in a timely fashion, including Victoria’s
Secret on New Bond Street. And right near the Olympic Stadium, in once undeveloped East
London, there’s Westfield Stratford City, handy for visitors who want a break from the events.
Once the Olympics are over, the 300-store mall will draw shoppers with its high-low fashion
(from Hugo Boss to H&M, Prada to Primark), electronics (Apple of course), more beauty
stores than a beauty junkie could dream of (from the obvious, MAC, Kiehl’s, L’Occitane, to the
esotericArabian Oud, the largest Arabian fragrance retailer in the world), and everyday retail:
supermarket (Waitrose), pharmacy (Boots), and banks. There are 80+ places you can eat or
buy food, with movie theaters, a bowling alley and casino. And more. With or without a Queen’s
Jubilee or the Olympics, London is clearly offering a shopper’s delight!


2012: The Year of "Moving On"
Looking back on 2011, images come to mind that instantly capture the state of retail around the
world, and anticipate the year to come. The images reflect the yin and yang of the world: the
global economy as it limped along (at best), and the now unrelenting pervasiveness of digital
technology. Together these converged to transform everything at retail in 2011, everywhere
from the U. S. to South America, to the Pacific Rim and on.
After four years of economic upheaval, American shoppers have taken control of what they can
and are moving on in new and different ways. Retailers too are moving on in their own way, as
is evident by the degree of retail innovation and renovation in 2011.

BIG, BOLD, AUDACIOUS SPACES
The opening of Duane Reade’s hugely audacious flagship drug store at 40 Wall Street, NYC,
set the tone for BOLD in 2011. The store’s “Upmarket” sushi bar, juice bar, fresh produce and
expanded grocery offering reflect the growing importance of food as a category in U. S. drug
stores.
And speaking of bold, who could forget the opening of the presumptuous new Apple store at
New York City’s iconic Grand Central Station? The store goes way beyond a destination for
travelers idling between trains; it has driven shoppers to other innovative retail stores now
established at the station, including Australian beauty retailer Aesop, with its store made out of
recycledNew York Times newspapers.

VIRTUAL STORES POPPING UP
Another image that defined the year was the opening of the Home plus virtual store in the
subways of Seoul, South Korea. This innovative concept features images of products as if in a
regular store, and enables shoppers to use their smartphones to scan the image’s QR codes
and instantly order, pay and arrange for delivery. Home plus and its partner UK’s Tesco
leveraged the virtual pop-up into a retail game changer, rolling it out into permanent virtual
stores, Then before you could say “click here” a Chilean grocery retailer Jumbo, and London-
based John Lewis Department Stores both followed suit with their own virtual stores.
The speed at which these virtual stores went from concept to execution and moved from Asia to
South America to England says much about the future of retail.

EXTREME COUPONING
If you haven’t seen this highly rated reality TV show, you can imagine what it’s about, and why
it’s all the rage. When it airs, coupon websites gain significantly higher traffic. Everyone wants to
be a smart shopper. While most shoppers don’t care to devote as much time as the TV show
contestants do to get their groceries, and more, for almost nothing, they do admire those who
do. Regular shoppers want to find their own “extreme couponing” in stores. What will retailers
do in 2012?

DEPARTMENT STORES TANTALIZE AFFLUENT SHOPPERS
Department store retailers around the world have come to recognize they must dazzle their
higher income shoppers, if they want them to shop and buy regularly.
As a result, we’ve seen renovations to revamp the shopping experience at many major
department stores around the world: From the age-old Printemps flagship in Paris, now
brilliantly new behind its traditional 19th century façade; to La Rinascente in Milan; and the
completion of a multi-year remodel of Bloomingdale’s NYC 59th Street flagship, just to mention


a few. The trend continues in 2012, when department stores such as London’s Selfridges and
New York’s Macy’s will both undergo renovations.
The changes we’ve seen in 2011 have clearly paved the way for continued innovation and
transformation in the year ahead. As retailers look to create compelling ways to entice shoppers
to buy more than what’s on sale, there will be much for us to report on as the year unfolds. Stay
tuned.
http: //www. forbes. com/sites/wendyliebmann/2012/01/19/2012-the-year-of-moving-on/


Nordstrom Moves To The Land of
Retail Opportunity

(Photo credit: Wikipedia)
The American retail industry is buzzing – about Canada. This week, Nordstrom announced its
plans to enter the Canadian retail market — joining other U. S. retailers such as Walmart and
Costco who have already successfully made the move.
Anticipating this trend, last month WSL/Strategic Retail launched our first study of Canadian
shoppers in How Canada Shops®, an in-depth analysis of how Canadian women and men shop
across all channels, and how they compare to U. S. shoppers, with specific comparisons of U.
S. and Canadian Walmart shoppers and Costco shoppers.
Why did we go to Canada at this time? U. S. retailers are now looking at Canada as a growth
opportunity. Target’s announcement that it would open in Canada in 2013 added impetus for us.
So too did the fact that department store retailer Lord & Taylor is now owned by the same
company that owns Canada’s The Bay. The Limited has opened Victoria’s Secret and Bath &
Body Works stores. As U. S. retail continues to struggle, more companies are looking north for
opportunity. So did we.
Here are some interesting tidbits from the study. While Canadian shoppers are similar to
American shoppers in some ways there are some not-so-subtle differences: they’ve made fewer
changes to how they shop because of the recession (they didn’t get themselves buried in debt
to the degree we did south of the board), they’re less driven to use coupons and sales (but they
are still very focused on value), and while they do their homework online they buy less online (at
least for now). In all, they are very compelling shoppers to target. These are only a few of the
differences U. S. companies should understand – and strategize against – to ensure a
successful market entry. For more info about the study go to our website, www.
wslstrategicretail. com.
http: //www. forbes. com/sites/wendyliebmann/2012/09/14/nordstrom-moves-to-the-land-of-
retail-opportunity/


Power Couple: Walgreens &
Alliance Boots Build Cross-Pond
Empire

SAN FRANCISCO, CA - People walk by a Walgreens store in San Francisco, California. U. S.
based drug store chain Walgreens has announced a deal to purchase a 45 percent stake in
European pharmacy retailer Alliance Boots for $6. 7 billion. The acquisition will make Walgreens
one of the world's largest drug store and pharmacy retailers with 11, 000 stores in 12 countries.
(Image credit: Getty Images via @daylife)
If you still doubt retail is in the process of tremendous change, don’t. In a move that’s at once
both brilliant and daunting, Walgreens, the largest US drug chain, purchased 45% share of
Alliance Boots, including the UK’s iconic Boots The Chemist, a global pharmaceutical
wholesaling business, and access to European and Asian markets.
Brilliant: Who would have thought of it? A global drug chain with 11, 000 stores in 12 countries
(8, 000 of them in the US). That’s only part of it. There’s the highly regarded portfolio of Boots’
private label beauty and health brands, the likes of Boots No 7, Botanics, Sanctuary, Clearasil,
and Soltan, to name a few. There is the retail division’s expertise managing prestige and mass
beauty brands under one retail roof. There’s the company’s experience running retail stores of
various sizes – from its flagship, multi-story, 15, 000 square feet store on Oxford Street, London
to its ubiquitous urban and suburban stores on British High Streets and small format
convenience-focused stores at British railway stations and airports. There are its years of
experience with its loyalty card, Boots Advantage Card. And, last but not least, the power (often
unrecognized in the US) of its global pharmaceutical wholesaling business.
Daunting: For one, the obvious challenge of combining two culturally different businesses
across 3, 000 miles of ocean. Both companies clearly understand retail pharmacy. However,
there are many differences in how drug store retailing operates in the UK and US, differences
between UK, European and US health care systems, and differences in how people in these
countries shop, in general and specifically for health and beauty.
So why? Why now? Only Walgreens’ and Alliance Boots’ management can say for a fact. But,
from our point of view, there is so much happening in retail around the world that establishes the
rationale for such a merger.
In the US alone, so much is changing the retail landscape: most notably the realization (finally)
that we have too many stores — for the most part a result of the impact the Internet and mobile
technology are having on the way people shop. As a result, retailers can no longer grow by
opening more and more of the same stores. Retailers of every variety (including Walgreens)
now ask themselves, “How many physical stores do we now need?”


Boots The Chemist at Gunwharf Quays, Portsmouth. (Photo credit: Wikipedia)
So how to grow? Well, smart strategy says you need different size stores, stores customized to
local communities, more virtual stores, possibly global expansion… for a start. Everyone from
Walmart to Target to Best Buy, Starbucks, Macy’s are responding. And of course, also
Walgreens — with its Duane Reade acquisition, flagship strategy, focus on urban formats,
addition of food, and purchase of drugstore. com and beauty. com.
For Alliance Boots, the US has been a tantalizing market for a long time. Its successful test and
rollout of Boots beauty brands in Target stores gave it a taste for the market. But where to go
next? And where to grow its wholesaling proposition? Now, we know where.
In the end, we say, “Brilliant trumps Daunting. ”
http: //www. forbes. com/sites/wendyliebmann/2012/08/23/power-couple-walgreens-alliance-
boots-build-cross-pond-empire/


Will JC Penney Shoppers
Accompany The Retailer To The
Finish Line?
Another year, another Black Friday and Cyber Monday. And while retailers from Kohl’s to
Macy’s, Target to Wal-Mart have been busy trying to thwart “show-rooming”—the consumer
practice of examining products in-store and then searching for the best deal online—the
venerable JC Penney is literally in a race for its life. But as the company dramatically overhauls
its stores into mini malls featuring certain brands or types of merchandise, will shoppers hang in
there to the finish line?
JC Penney shoppers have been whipsawed on pricing policies ever since the arrival of CEO
Ron Johnson a year ago this month. First the chain eliminated the more than 500 sales it used
to stage all year long, in their place offering lower pricing across the board in its approximately
1, 100 locations. No testing of this new pricing approach was done, Johnson told The
Associated Press, because time didn’t allow it. The result: shoppers went elsewhere. Late this
summer, Penney got rid of its month-long sales offering—part of a three-tier strategy along with
lower across-the-board pricing and periodic clearances—but sales continued southward.
Financial results followed suit, with the company’s sales plummeting just over 26% in the third
quarter of 2012.
The grand scheme now under way at Penney is to transform most of its stores into a sort of mini
mall—stores within stores featuring wares from the likes of its own Liz Claiborne brand, Izod,
Levi’s and Sephora. To protect margins, some of this merchandise won’t be available online.
But shopping habits seldom change quickly. Instances of major retailers successfully completely
revamping their operations and pricing policies are few and far between. CEO Johnson certainly
has the chops for the job. He led Target to “cheap chic” success and then joined Apple to
design its highly successful retail outlets. A look at consumer research strongly suggests that for
his current challenge he did too good a job at Target, which stands above both JC Penney and
Macy’s in key respects, per the GfK MRI Focus: Retail study. Nearly 26% of people who
shopped at Target in the last three months agreed with the statement, “For the products I
usually purchase at this store, this is my ‘go to’ store. ” The figure for JC Penney was 14. 7%
and for Macy’s 10. 6%. The percentage of shoppers who believe they “can always count on
great service” was 28. 9 for Target, 18. 9% for JC Penney and 12. 8 for Macy’s. Slightly more
consumers (23. 8%) say they frequent JC Penney based on price versus 17. 7% of Macy’s
shoppers. Since JC Penney and Macy’s share a fair amount of mall locations, these figures are
good news for JC Penney.


Alas, JC Penney simply is in a race against the clock. So far it has transformed a small handful
of its stores, and the results have yielded $269 in sales per square foot compared with $134 in
older stores, according to The New York Times. Problem is, it needs to spend mightily to
revamp almost 90% of its locations, something that could take years. Meanwhile, its loyal core
of middle-income consumers has begun voting with its feet. While it’s possible that JC Penney
can win over new shoppers in the long run, any major disruption to the economy along the way
(think fiscal cliff-induced recession) will infinitely complicate matters.
http: //www. forbes. com/sites/annemariekelly/2012/11/28/will-jc-penney-shoppers-accompany-
the-retailer-to-the-finish-line/


Are Retailers Cannibalizing Black
Friday?
Black Friday isn’t what it used to be. The days of working off that turkey and stuffing by running
around the mall and scooping up holiday

Black Friday shoppers at Walmart (Photo credit: Wikipedia)
deals the day after are waning, because now you don’t even have to wait until you’ve digested
that drumstick. Stores are opening on Thanksgiving Day itself, and there are plenty of sales in
the days leading up to Thanksgiving, not to mention Cyber Monday along with the many pre-
Christmas bargains that stores are offering.
So what’s a consumer to do? Not only is there confusion about whento shop, it’s gotten to the
point where there are so many great sales this time of year that the meaning of Black Friday has
been cannibalized. That rush of excitement waiting for the doors to open, and the excuse to be
out of the house and away from your relatives, is no longer a given.
It’s always a little sad when traditions change. Time marches on in this digital age, especially in
the world of retail. But at least there are many ways for consumers to save at a more leisurely
pace. Let’s look at what retailers are doing this week.
Amazon is offering Black Friday Deals Week, an actual countdown to Black Friday, including
lightning deals each day on apparel, electronics, toys, games and more. On Thanksgiving Day
itself, many stores are advertising exactly what items will be on sale, and at what hours, so that
shoppers can be more targeted and focused with their purchases and waste less time pushing
through the crowds.
Walmart, for example, is selling its hottest electronic items, including the Apple iPad2 16GB
with wi-fi, between 10 and 11 pm on Thanksgiving Day, so the shopping can start the moment
the dishes are done.
Shoppers don’t even have to wait until evening. For those who prefer retail therapy to watching
football, Sears, Target and Toys R Us are all open Thanksgiving Day, offering deals on
everything from stocking-stuffer toys to Xboxes and Playstations. The list and range of retailers
doing business on that day is long and growing, with at least 20 major chains planning to be
open.
Just as for Thanksgiving Day, stores are advertising online exactly what items will be on sale,
for how much, and when for Black Friday. At Staples, for example, customers arriving before
noon can save over $200 on certain HP PCs with Windows 8. PetSmart, meanwhile, is giving
dog and cat lovers a steep 75% off select items online.


How will the specificity of the items, and the window of time in which they are available, affect
sales? The Black Friday strategy has always been to get people in the stores with doorbusters
and then sell them other items once they are there. If an item is very popular (e. g. the iPad),
advertising a deal on the specific item will naturally draw in shoppers.
I believe the difference in 2012 versus even just five years ago is the level of intelligence many
retailers now have about their customers. With loyalty cards and deep analytics, many retailers
know precisely the types of customers who will be drawn in by certain offers, and what other
products those consumers are likely to buy once they are in the stores. They can know the price
points at which consumers will buy an item, and they can also know the times of day consumers
of certain demographics shop.
This intelligence allows retailers to be very targeted in the types of offers they make. Also, by
starting early – on Thanksgiving Day or earlier in the week – retailers can find ways to lure a
shopper back into the store on Black Friday or online on Cyber Monday with a targeted email
offer.
So these new holiday “traditions” aren’t necessarily hurting retail. If anything, the spread of sale
days is helping to bolster overall revenues and maintain consumer interest before, during and
after Black Friday itself, which remains the most important day of the shopping year. With the
NRF forecasting a 4. 1 increase in holiday sales for 2012 over last year, given the impact of
Hurricane Sandy, Black Friday will undoubtedly play a key role in determining whether or not
this happens. Last year, that one day accounted for $11. 4 billion in sales, an increase in 6. 6%
from the previous year. Cyber Monday will also be an important day – it rang up $1. 25 billion in
sales in 2011, up 22% from 2010.
Next week, we’ll get the results. Until then, enjoy your Thanksgiving and don’t forget to do your
part to support the retail industry this week!


Are You Really Getting A Bargain
Black Friday Deal?

Black Friday shoppers at Walmart (Photo credit: Wikipedia)
If you plan to line up outside Wal-Mart Stores (NYSE: WMT), Best-Buy (NYSE: BBY),
Macy’s (NYSE: M), Apple store or any other major retailer this Thanksgiving evening to buy
merchandise at deep discount, you better think twice: you may end up buying things you don’t
need, wasting your time and money. Especially if you are an emotional shopper.
Humans are both intelligent and emotional beings. As intelligent beings, we make decisions by
reason. We carefully examine the environment we live in, setting goals and priorities. Then we
craft alternative strategies and tactics to reach them.
Emotional beings decide by impulse, fueled by anxiety, anger, fear, greed, and other emotions.
Both the intelligent and the emotional sides of humans come out in shopping. Intelligent
consumers begin with the “Big Picture, ” things that are important in their lives, setting needs
ahead of desires. Before they grab a piece of a merchandise and head for the cash register,
they always ask three simple questions:
Do I need the product?
Is the price right?
Is this merchandise the best use of my money?
Emotional consumers, by contrast, act by impulse, passion and hype. They race out to buy
products — filling the dreams and aspirations of ruthless marketers, rather than their own.
They see the “Big Picture” too, but upside down, often placing desires ahead of needs. They
rush to buy merchandise just because it happened to be on sale, without asking whether they
really have a need for it in the first place; whether the price is right; and whether it is the best
choice for their money. They end up subscribing to magazines they never read; joining health
clubs they rarely visit; buying clothing they never wear; purchasing tools and accessories they
never use; and bringing home toys their children hardly touch.
Obviously, intelligent consumers allocate their resources efficiently and effectively, while
emotional shoppers waste their resources.
But why do so many consumers do that? Why do they shop with emotions rather than
intelligence?
Because emotional shoppers allow themselves to be manipulated by marketers who hype their
emotions by sales events like Black Friday. They are too concerned with the prospect of missing
out on a sale opportunity — buying merchandise indiscriminately, irrespective of the need for it.


The bottom line: Before you head out for the stores on Black Friday, ask yourself the three
simple questions of intelligent shopping, so you make sure you are really getting a bargain.
http: //www. forbes. com/sites/panosmourdoukoutas/2012/11/18/are-you-really-getting-a-
bargain-black-friday-deal/


Why Retailers Have to Open on
Thanksgiving This Year

Image via CrunchBase
I get the angst the retail employees are feeling about having to work on Thanksgiving, I really
do. Retailers like Wal-Mart, Target, Toys R Us and Kmart are among those stores that will be
opening in the evening on the big day and its employees will have to be there like it or not. And
for most of these workers, it is definitely not.
Corporate greed is blamed for the decision, and technically that is true if one defines corporate
greed as staying solvent. Brick-and-mortar retailers are on the brink of getting parity in the e-
commerce-versus-real world shopping wars, but they still cannot afford to lose ground over the
holiday season.
Consider this: Last year IBM‘s Holiday Benchmark survey reported thatThanksgiving online
shopping grew by 39. 3% year over year. On Black Friday, online sales grew by 24. 3%
compared to the same period last year.
If these people are logging on to shop, the thinking goes, they should also be interested in
walking through a retailer’s doors as well.
And when they do they will be counted and tracked by ever increasingly sophisticated retail
management systems.
“Retailers have been struggling with fact that so many sales have been going to ecommerce, ”
Rob Wilson, senior director of Retail Analytic Packages atSAP, says. Indeed they might have
seen themselves on the losing side of technology in previous years (that darned Internet!) but
not so this year. “The past 12 to 18 months we have seen some amazing advancements in in-
memory technology, POS data management and associated analytics. ” In-memory allows for
the rapid granular analysis of activity at the transactional and SKU level, he says. “It lets
retailers make decisions almost in real time about what is moving and at what times in the store.
” They can comfortably predict what sales would be like if they opened an hour earlier or later
or, oh let’s say, on Thanksgiving Day.
Not that ecommerce is doomed now that stores are adopting bigger and meaner tech tools. This
holiday season 20% of all online sales will come from mobile devices. So predicts the IBM prior
to releasing its Holiday benchmark.
Not surprising, Apple‘s iPad and iPhone are driving much of this traffic, with 8% of online traffic
originating from the iPad and 7. 2% from the iPhone.
The iPad Mini will probably skew online sales traffic even more, says Michele Turner, CMO of
mBlox. “The iPad Mini will be transformative in terms of online shopping. It is small enough to
toss in your purse or keep in your pocket, but still has robust browsing capability. It can be part
of creating a great branded experience for a retailer. ”


So as retailers step up their POS investments and mollify employees working on Thanksgiving
as best they can, they also have to consider their mobile–not just online—presence.
For the record, mobile shoppers, it has been determined in numerous studies, don’t bother to
wait more than a second or two for sites to open on their devices. They also can be exceedingly
impatient with clunky payment processes.
It is well worth it for sites to overcome these challenges.
Last year, consumers spent more than $20. 7 billion shopping using mobile devices, according
to The EGC Group’s report “How to Prepare for the First Nonline Retail Season”. Also, one in
four used more than one device to shop during the 2011 Holiday Season, a percentage likely to
increase as people add to their stable of tablets.
http: //www. forbes. com/sites/erikamorphy/2012/11/17/why-retailers-have-to-open-on-
thanksgiving-this-year/


With Thanks giving - Night
Openings, Do Retailers Risk
Busting More Than Doors?
Retailers are opening earlier this holiday season, sandwiching Thanksgiving turkey between the
work week and yuletide shopping as never before.

Target, Black Friday (Photo credit: Wikipedia)
Target is opening at 9 p. m. on Thanksgiving, while Sears and Walmart will open at 8 p. m.
Talk of putting the customer at the center of all marketing moves is on the lips of every CMO
these days. But equally important, both for brand health and consumer engagement, as we’ve
seen time and again, is keeping employees committed, happy and motivated.
The risk in alienating employees is alienating shoppers, of course, and that could have a
negative impact on brand.
“To the extent that consumers relate more with employees pressed to work in stores on
Thanksgiving than they do as customers who want to shop on Thanksgiving, it could have a
negative impact on the brand, ” said Brooks Holtom, Associate Professor
of Management at Georgetown University’s McDonough School of Business, in an email.
“Because I think that consumers will be quite mixed in their opinions about shopping on
Thanksgiving, the potential backlash against the retailers will be muted. While they may express
outrage or moral indignation, whether they go shopping or not is the truest test of how they feel.
”
The reality, of course, is that U. S. employees can choose not to work for retailers that choose
to open their doors early. “Because they are NOT indentured servants, they can choose to work
or not work, ” Holtom said. “However, there are consequences of those choices. Employers face
a favorable labor market right now. Unemployment is relatively high, and many of the jobs that
are being created are low-wage jobs. Competition for jobs is strong. So, even though workers
prefer to be home for Thanksgiving, economic necessity compels them to work whenever
requested. ”
To keep employees happy, Target, for example, “should do its best to staff the store with those
employees who volunteer to do so, ” he said. “Offering incentive or holiday pay allows the
market to work. If they don’t get enough volunteers, they may need to up the pay. While
employees will have different preference functions, the employer will over time find a market
clearing wage. ”
In fact, “across the company, one-third of Target’s store team members are scheduled to work
on Thanksgiving, ” Target communications manager Molly Snyder said in an email.


“And on Friday, less than two-thirds of our team members are scheduled to work, ” she said.
“We’ve heard from many stores that they had more team members volunteer to work than they
had available shifts. In those cases stores were asked to make back-up lists to allow for the
most flexibility if team members needed to make scheduling changes. ”
Target’s decision to open on Thanksgiving night wasn’t made without employee buy-in, she
said. It “was carefully evaluated with our guests, team and the business in mind, ” Snyder said.
“Across the country, team member preferences were considered in creating our store staffing
schedules. ”
Georgetown’s Holtom believes that retailers like Target should make sure consumers know
what they’re doing when it comes to employee relations. “If I were consulting to Target, I would
encourage them to publicize all efforts to staff using volunteers. They should clearly articulate
their incentive pay and project the economic benefit that will follow. They can also apologize for
any perceived encroachment on the holiday, ” he said.
In the meantime, Target sales-floor employees won’t be the only ones pulled from mashed
potatoes and gravy this Thanksgiving. “At Target we all believe that it’s important for our team
— and particularly our leaders — to be actively involved, ” Snyder said. “Our senior leadership,
including Jeff Jones, will spend Black Friday in stores across the country, meeting our guests,
and celebrating and working together with our store teams. ”
In the end, consumers will vote with their wallets this holiday shopping season. “If no one goes
shopping on Thanksgiving, then retailers will not open on Thanksgiving in the future, ” Holtom
said.
http: //www. forbes. com/sites/jenniferrooney/2012/11/14/with-thanksgiving-night-openings-do-
retailers-risk-busting-more-than-doors/


Retailers, Can You Hear Us Now?
Last month I ended my post with the call to action for retailers and manufacturers to listen, not
to me but to consumers. I stated a well-known fact: the customer is in charge of the dialogue,
and the only way to know whether you are right is to look at your sales data. If your comp store
sales are up over last year, you were right; if not, you were wrong. It’s that simple.
Another well-known and documented fact is that the retail market in North America is a zero
sum game. The National Retail Federation (NRF) projects that U. S. retail sales will grow 3. 4%
in 2012. The retail market is not growing substantially due to population explosion or technology
or productivity enhancements on a broad level. One retailer or manufacturer’s gain is another’s
loss. So, how do you win?
You win by expanding into new markets or categories, or by growing comparable store sales in
existing categories, or both. In all cases, in order to provide long-standing shareholder value,
you must have the products that consumers want. So what does this have to do with listening?
The answer seems obvious. Why wouldn’t we listen to consumers to find out what products they
want? One reason not to listen to them is the belief that they don’t know.
A perfect case in point about retailers’ attitudes is NBC’s new show, Fashion Star. It’s a great
concept – new fashion designers show their styles to retail experts from Saks, Macy’s and H&M,
each of whom provides their opinions and votes with their orders. The winning styles are then
made available in stores the next day.
The show seems like an interesting idea and is generating some marketing buzz for the
retailers. In a recent Apparel article, Martine Reardon, CMO of Macy’s said: “Fashion Star is
more about marketing than commerce. It helps us keep our brand out there. ”
Saks CEO Steve Sadove said the show is essentially a “one-hour commercial about who Saks
is. ” Sadove added that website traffic doubles when the show airs, and the company has seen
an increase in show-related purchases and new visitors to the Saks site.
But, overall, show viewership for Fashion Star is relatively low at 4. 5 to 5 million viewers. Why?
Well, let’s compare it to Fox’s American Idol, which averages 15-20 million viewers. People are
performing, experts are reviewing, but wait… there is one additional piece. On “Idol, ” American
viewers get to vote, and it matters – even if the experts disagree. What a concept! Listening to
the people and giving them what they want. Reminds me of an old quote from Marshall Fields,
“Give the lady what she wants. ” But the question is, how?
I have not met a single executive who did not want to listen to his or her customers. Most have
lamented the issue that, even though they listen to their customers, what the customer have told
them and what the customer actually did were two entirely different things.
Did this ever happen to you? If this is the case, one or more of three issues may be the cause:
One, you are not listening to the right people. Two, you are not asking them the right questions.
Or three, you are not making it enjoyable for the consumer to engage with you and you end up
getting bad information.
If you want the right people to give you the right information, you had better make it enjoyable.
This will be the topic of my next post.
http: //www. forbes. com/sites/gregpetro/2012/04/12/retailers-can-you-hear-us-now/


Retailers: Who Do You Trust?

Forever 21 Store (Photo credit: Rajiv Patel (Rajiv's View))
Trust is a funny thing. It is something that is highly valued, but cannot be bought. It must be
earned, but cannot be sold. Its lifespan is as long as you care to maintain it.
During my 25+ years in the retail industry, I have worked very hard to build and maintain the
trust of my customers. How? By doing what I say I will do, by maintaining confidentiality with the
information shared with me, and by acting in my customers’ best interests. Why? Because it
makes good business sense, of course. But ultimately, because a trustworthy reputation is one
of a few things that is and will be remembered.
What does this have to do with retailers, brands and products? Well, you work extremely hard to
establish a reputation with a group of people – your customers — who come to the places you
have built – your stores — to get the products you have become known for providing. A simple
word comes to mind in maintaining a trusted relationship: fairness. The trust your customers
have developed with you comes from the idea that they expect a carefully edited set of products
at a fair price. They will give you their hard earned dollars for a fairlyvalued product.
Brands also develop trust with their customers. The “brand promise” is ultimately the trust
consumers have placed in a brand they like. Consumers who are loyal to a brand will trust that
the next product introduced under that brand will fulfill the brand promise.
The more frequently you fulfill your promise, the more trusted you become. Given how easy it is
for a customer to walk across the mall to your competitor, or price shop your products online,
your competitive advantage is largely derived from how well you develop a relationship based
on trust.
It begs the question:
How can you improve in earning the trust and consequent purchase dollars of your customers?
One direct way is by meeting expectations consistently. Setting and fulfilling expectations is the
easiest way to build trust both in a relationship and through a product. Here are a few examples:
Retailers Forever 21, H&M and now Uniqlo have developed fashion-forward, value-oriented
products that their customers recognize and desire. It is not just simply that their products are
less expensive. These retailers consistently deliver on a promise of quality, and this approach
has delivered strong returns for their businesses.
Costco delivers a great product set at a highly communicated 13% margin (tremendous value
delivery), along with a consistent experience.
McDonald’s, Coke and Marriott all set and consistently meet expectations. Regardless of where
you visit a McDonald’s or a Marriott, you will (almost always) experience a similar level of
service and a similar product.
Sometimes retailers and brands delight their customers with exceptional experiences. Examples
include Polo’s Mansion, Louis Vuitton’s newest handbag, and Wal-Mart’s superior fulfillment
ability which ensures they will always have the product you are looking for, in-stock.


How do you know what someone expects of you? One way is to visit as many of your
customers as you can and ask them. Open, honest dialogue is invigorating and informative. You
learn so much, even if you are already meeting their expectations.
Walk the floors, visit stores, survey or simply get out and explore. One of my favorite movies
is Brubaker. It is an 80’s film in which Robert Redford plays a newly hired warden who goes in
as a prisoner to understand what is wrong with the system. A current show
on CBS is Undercover Boss, in which a CEO goes in undercover to learn the true story of what
is happening within his or her own company. In almost every case, it is a true discovery session.
I suspect that is the case for all of us, but the discovery comes at the cost of time.

Undercover Boss (U. S. TV series) (Photo credit: Wikipedia)
Often we hire consultants to understand… and they are helpful … but to fix a situation
permanently, you need a systemic way of continuously getting customer feedback.
Technology can help bridge the gap. Looking at Point-of-Sale (POS) data gives a rear-view
mirror view of what consumers want and have bought. I think we all know what happens when
you look in the rear-view mirror too long. But today’s tools for leveraging social media and the
“wisdom of crowds” can give a forward looking view into what’s coming and how people feel.
Trust can now be measured, in terms of how your customers will view your new products verses
your competitor’s products, and how well your new product offerings will deliver on the value
you are proposing.
In addition to learning what consumers expect, the process of seeking consumer input itself
builds trust with them. In our work with retailers and brands, we have found that consumers
engage with online games at rates two to five times higher than typical promotional email
campaigns. In fact, the email subject line that tends to generate the highest open rates is “tell us
what you think. ” The lesson? Your customers want to engage with you!
So reach out and find a way to engage the customer. You will learn what they expect, and will
earn their trust in the process.
http: //www. forbes. com/sites/gregpetro/2012/07/12/retailers-who-do-you-trust/


Retail's Big Question: Is The Price
Right?

With the holiday season upon us, retail CEOs know that this month will make or break their
year. As many retailers and brands launch new products, two factors will determine success or
failure: is it the right product, and is it priced right? These days, pricing is the hottest topic in
retail, and it is also the most complex.
Over my next few posts, I will share insights and comments from discussions with several CEOs
with diverse opinions on pricing in the retail industry.
Markdowns, discounts and promotional strategies abound, creating a dangerous pattern
deemed a “race to the bottom. ” Retail blogger Robin Lewis put it best when he said, “It
behooves brands and retailers to beware what they ask for by diminishing the value proposition
to…buy me, I’m cheap. ” When the “value” of a product shifts from brand recognition,
differentiated features and in-store experience to merely “price, ” you have entered that race to
the bottom.
Regarding price, consider that while Americans bought 19. 4 billion garments last year, a 5. 3
percent decrease from 2010, the total apparel sales dollars rose almost 5 percent to $283. 7
billion, according to the trade group American Apparel & Footwear Association. This means
price increases, along with some shift in product mix to higher-priced garments, accounted for
all of the growth in the apparel industry in 2011. This should set off alarm bells in the heads of
most apparel retailers and brands.
Why? First, with stagnant or declining unit sales, if retailers are not pricing products to capture
full consumer value, comp sales will almost certainly decline. Unfortunately, this is already
happening for many retailers. Second, for those who have managed to increased comps by
pushing price increases, how do they know they have captured all of the consumer value? How
much is being left on the table?
So how do retailers and brands approach pricing today? There are several different models,
including “take it or leave it” pricing (e. g. Apple, Under Armour), the “manufacturer’s suggested
retail pricing” that no one actually pays (e. g. automobiles) and value- or volume-based pricing
(e. g. Costco).
In the fashion industry, pricing models are just as mixed:
“Fixed Price” on unique products with long lifecycles (e. g. Uniqlo)
Percentage off “retail price” plus additional discounts, promotions and markdowns (e. g.
Kohl’s).
“Everyday Low Price” (e. g. JC Penney)
Set entry price with quick markdowns when inventory doesn’t move. This model is often
used by fast fashion retailers with short product lifecycles (e. g. Wet Seal)
“High/Low” pricing, where products are in a near constant state of change… up, down,
up, down.


Now layer on e-commerce, with mobile technology enabling real-time price comparisons, and
the exercise of pricing becomes even more complicated.
It is no wonder the consumer is confused on what is and what is not a good value anymore. JC
Penney, for example, is clearly struggling as it attempts to change the customer’s mindset. One
customer recently stated on the retailer’s Facebook page: “This is not a change at all, there has
never been a day in all of my shopping at JC Penney where ANYTHING has been full price. ”
Another customer stated, “I really, really miss my coupons. ”
In this three-part series, I will explore how pricing is managed in three different retail entities –
first Specialty & Vertically Integrated Retailers, then Department Stores, and finally individual
Brands (the manufacturers). I will look at what’s working and what’s not, and I’ll discuss the
results of some of my conversations with CEOs in each category.
http: //www. forbes. com/sites/gregpetro/2012/12/11/retails-big-question-is-the-price-right/


Pricing Part 2 -- Focus On
Specialty & Vertically Integrated
Retailers

As I indicated in my last post, in this series I will explore how pricing is managed in three types
of retail entities – first Specialty & Vertically Integrated Retailers, then Department Stores, and
finally individual Brands (the manufacturers). I will look at what’s working and what’s not, and I’ll
discuss the results of some of my conversations with CEOs in each category.
Let’s start with Specialty/Vertically Integrated Retailers. Just a few of the many companies that
fit this category include Aeropostale, American Eagle, Charlotte Russe, Hot Topic, Gap, Men’s
Wearhouse, and PacSun.
These companies control the entire product lifecycle – from design to manufacture to
distribution. Let’s look at a couple of these retailers, starting with Charlotte Russe.
Charlotte Russe is a fast fashion specialty retailer with over 500 stores with a spotlight on
women in their teens and early twenties. In a recent conversation with Jenny Ming, Charlotte
Russe’s CEO, she told me that “Charlotte Russe is about the right fashion at the right price, ”
adding, “if she (the customer) doesn’t want it, lowering the price will not make it more attractive
to her. ” As a result, Charlotte Russe avoids heavy discount promotions but sometimes offers
buy-one-get-one-free offers (BOGOs) to provide the customer with more of the type of product
she wants. The initial entry price is clearly critical at Charlotte Russe.
I also spoke recently to Gary Schoenfeld, CEO of teen retailer PacSun. Their approach to
pricing is based in part on the type of product – basic vs. unique. Schoenfeld stated, “With basic
products, understanding the competitive landscape is very important. For unique products, we
have more flexibility based on how our customers value our unique designs. ”
Mindy Meads, former co-CEO of Aeropostale, current Wet Seal board member, and previous
Federal Reserve Bank board member, recently told me, “In a highly promotional environment,
the key to the value equation is having the right combination of all three factors – fashion,
quality and price. ”
Compared to Department Stores and Brands, Specialty (and Vertically Integrated) Retailers
have the most control when it comes to pricing. Vertically Integrated Retailers control the entire
process. The best ones design product from the beginning to target specific price and margin
points. They also control the in-store experience, which can’t be ignored when understanding
the value of the brand and how it affects pricing.
Success in this space requires you to “Distinguish yourself and stay true to who you are. Own
your vision and have it be consistent, ” explained Ms. Meads.


Added Jenny Ming, “To be a great retailer you must have an incredible sense of
curiosity…curiosity to understand, learn and explore. ”
As Gary Schoenfeld, CEO of PacSun, succinctly summarized: “We have a knowledgeable
customer who understands the value and pricing of our products. If the fashion and price is
trend right, we have a win-win scenario. ”

Getting the Price Right from the Start
With price as a primary engine for growth over the next few years, pricing will clearly be an
integral part of the value equation for consumers in deciding what is the “Right Product. ” In a
study of 70 retailers in April 2012, retail analyst firm RSR found that 67% of respondents
reported consumer price sensitivity as a top-three business challenge, up from 46% in 2010.
Interestingly, they found that 55% of “laggards” (underperformers in year-over-year comparable
store/channel sales) are using promotions as their pricing strategy, versus approximately 35%
of all other respondents.
“Retailers must return to a value-based proposition for consumers, ” Nikki Baird, Managing
Partner of RSR, recently told me. “This means there is a lot more importance on the initial price,
because any retailer making a value argument about its prices is going to lose a lot of credibility
with consumers if it then has to run promotions or markdown items because it didn’t hit
consumers’ initial expectations. ”
So vertically integrated retailers know they must get the price right from the start. It is also
becoming clear that these retailers want to price based on customer value, and that pricing
based on assumed psychological barriers, or based on standard cost mark-ups, is no longer a
“best practice. ” The best retailers are using data to drive decisions on price-setting… not
historical data, but forward-looking data based on precise knowledge of what consumers will
actually pay.

Next up: Pricing from the perspective of Department Stores.

http: //www. forbes. com/sites/gregpetro/2012/12/20/retails-big-question-is-the-price-right-part-2-
focus-on-specialty-vertically-integrated-retailers/


Pricing Part 3: How Does A Brand
Know When The Price Is Right?

(Image credit: AFP/Getty Images via @daylife)
Ever wonder how a manufacturer or brand comes up with the number on the price tag? Arriving
at that figure is a complex process, and getting the formula right is key to the health of their
profit margins.
This four-part series covers the hottest topic in retail: pricing. I’m sharing the results of
conversations with several retail CEOs who are commenting on the challenges as well as best
practices in the industry. At the NRF conference in New York City on January 14, I will also be
moderating a panel discussion on this topic including several of the industry experts interviewed
in these posts.
In my last post, I wrote about the pricing models and challenges facing specialty and vertically
integrated retailers. This time, I will focus on the brands or manufacturers that sell through
multiple retail channels.
How can brands price so they capture full customer value, grow sales and preserve margins?
How do they avoid the so-called “race to the bottom”?
Brands typically rely on department stores or other channels to distribute their products. The
department stores achieve differentiation through a combination of the product assortment, the
customer experience, and the price/value equation. But, for the manufacturer, the differentiation
resides with the brand itself.
Many brands have relatively narrow product lines, which tends to reduce their leverage with
retailers. But Nike, for instance, has a broad product line which includes everything from
shoes to apparel to sporting goods, which in turn allows them stronger negotiating power with
retailers. Apple has a relatively narrow product line, but the brand is so strong that they have
been successful selling both through retail partners (wholesale) as well as through their own
retail channels.

So how does a brand set the entry price for a new product?
Forbes. com contributor Matthew Carroll wrote a comprehensive piece in February 2012 on this
topic (“How Fashion Brands Set Prices”), describing how most manufacturers start by
determining the targeted retail price to the consumer, otherwise known as the manufacturer’s
suggested retail price (MSRP). If the new product is an extension of an existing product line,
or a replacement for a previous style, the brand will typically expect a similar price as the
product’s predecessor, unless there have been significant changes in market dynamics.
But if the product is new to the manufacturer’s line or is in an entirely new category, establishing
the MSRP is more difficult. Many brands will analyze the market and the competitive landscape


for the product category to determine where the new product will be positioned. Some
manufacturers lay out a grid with price versus features, placing competitive products on the grid
along with the proposed new product.
In addition to the retail price (MSRP), the manufacturer also attempts to estimate the average
unit retail price (AUR). AUR is important because it is the average price the product will bear
over its lifetime, taking into account all promotions and markdowns. MSRP is something the
brand controls and sets; AUR is something that occurs based on consumer demand.
With a target retail price in mind for the product, the brand then works backwards to determine
the wholesale price to the retailer. For years, retailers applied a standard 2x “Keystone Markup”,
which meant that the retailer would double the manufacturer’s wholesale price. Today, both
retailers and brands have access to robust analytics which give them better information with
which to negotiate wholesale prices. Also, for manufacturers with broad product lines, the
markup may differ based on the line or even the individual product. Other components can
affect the markup, such as volume discounts, rebates, and marketing/advertising dollars
provided by the brand to the retailer. Because of these factors, the standard 2x markup
rarely applies these days.
Once the wholesale price is determined, the brand assesses its cost to manufacture the
product. If the brand cannot make its targeted margin at the wholesale price, it may decide not
to proceed with the product, or it may make modifications to the product in order to reduce the
cost. Most brands are looking for margins of at least 50%.
This all sounds relatively straightforward… so why is it such a challenge? Because most brands
must make the decision on whether or not to move forward with a new product 12-15 months
prior to its introduction. They can’t wait for the negotiation with the retailers on wholesale prices.
As a result, many brands don’t work backwards from the estimated retail price; instead they set
the wholesale price based on a standard mark-up over manufacturing cost (say 2x or even 3x
their cost).
The problem here is that when the product is ready to launch, the MSRP may end up being the
wrong price because it was developed based on cost instead of what the end consumer will
pay. But the problem really started 12-15 months earlier, when the product may have been
over-designed (or under-designed) for the targeted price point.
“Data drives so much of our insights today, yet one of the most important and overlooked
factors in trend-related consumer products is the initial price, ” said Matthew E. Rubel, Senior
Advisor at private equity firm TPG Capital and TPG Growth, and former CEO of Collective
Brands (previous parent company of Payless, Stride Rite and other brands), in a recent
conversation. “Years ago, the advent of GMROI changed the way we looked at gross margin
and the investment it took to get it…today we need to test and validate initial pricing in order to
optimize our return. The opportunity for the savvy retailers and brands is to understand this and
move ahead of the curve. ”
Today, many brands are using technology to learn the price the market will bear for a new
product, at the point of initial product development. Manufacturers are gaining consumer insight
on candidate new products – even in entirely new categories – 12-15 months before
introduction. These manufacturers are able to analyze a price elasticity curve, yielding a
forecast of the average unit retail price before product development dollars are spent. They use
this information to set the MSRP based on market demand rather than based on cost mark-ups.
They also use this data to eliminate potentially unprofitable products early on, or missed sales
through stock-outs later on.
“With digital and immediate access to consumers, the process is no longer cumbersome, ”
continued Rubel. “It is like a third party working with the buyer and the planner. ”
Mike Ray, CEO of Vera Bradley, a leading manufacturer of fashion handbags, luggage and
accessories, told me: “As a brand selling through multiple channels, setting the suggested retail
price is critical for us. We establish retail prices months before a product is launched, so we
need a forward view of what the market will bear. We’re using real time consumer insights
gathered through online engagements which give us actionable data on how to set MSRPs.


This gives us insight into higher price point–and margin–opportunities, well before the product
introduction. ”
As we have been sharing over the last few posts, price is an essential element in determining a
new product’s success or failure. Using historical norms to predict the price performance of a
new product is analogous to using a stock or mutual fund’s history to predict how that security
will perform in the future. As we see in nearly all investment literature: “past performance is no
guarantee of future results. ”
Next up: Department Store Pricing – No Easy Task
http: //www. forbes. com/sites/gregpetro/2013/01/03/pricing-part-3-how-does-a-brand-know-
when-the-price-is-right/


Retail (Bán lẻ) 2013

Recommandé

Recommandé

Contenu connexe

Tendances

Tendances (13)

En vedette

En vedette (9)

Similaire à Retail (Bán lẻ) 2013

Similaire à Retail (Bán lẻ) 2013 (20)

Dernier

Dernier (20)

Retail (Bán lẻ) 2013