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The Local Connection: How Independent Retailers are Joining Forces to Flourish

For some small business, local relationships are key.

 

Traditionally, independent retailers have sought out their locations quite deliberately––an up-and-coming neighborhood or a particularly hot development, for example. However, things are changing, and unexpected sites (think abandoned buildings and the like) are turning out to be the winning ticket for like-minded business owners aiming to sell the idea of craftsmanship through their goods.

 

Take Boxpark in Shoreditch, London, for instance. Coined the “pop-up mall” for the people, Boxpark is made up of 61 shipping containers. The concept was founded in 2011 by CEO Roger Wade, and it allows independent retailers and artists to set up shop with relatively low lease expenses. The beautiful thing here is variety, underscored by the fact that even mega retailers have dropped by with “installations.” Gap experimented at Boxpark with an edited assortment called “Black is a Color.” For larger retailers, Boxpark is perhaps less about sales and more about brand exposure in a more artistic light.

 

A second London example is We Built This City, located in Carnaby. The shop showcases a curated selection of over 250 artists every month from area neighborhoods. The idea is to market souvenirs for tourists that depict a more accurate, genuine and artistic representation of the city, versus the cheaply made, mass-produced mugs, magnets and other paraphernalia so often found throughout London.

 

Another example is Strange Invisible Perfume in Venice Beach, California. Small and independently owned, this botanical perfumery is located right next to Le Labo, a major competitor, which might seem counterproductive. As it turns out, the two businesses have worked together to become a one-stop perfume destination for customers. The retailers also share similar brand beliefs and principles, which center on a bohemian, holistic perspective that weaves in an Old World dedication to their craft.

 

Lastly is Lacausa in Silverlake, Los Angeles. The name itself has a double meaning: their origin of LA (Los Angeles), CA (California), and USA (United Staes of America). In Spanish, the name means “the cause,” which references owner Rebecca Grenell’s mission to produce garments only under ethical environments in an LA factory and warehouse.

 

As these shops and collectives highlight, for many customers, the local connection is key. From featuring independent artists to developing products with local tie-ins, native relationships are a valuable commodity.

Snapchat: How Retailers Can Capitalize on the Craze

Branded filters cost a pretty penny, but the potential for exposure is huge.

 

Snapchat filters are not-so-slowly becoming the way Millennials prefer to communicate (at least, for fun). While older generations might find the filters silly, some retailers are capitalizing on their potential––that is, the fact that so many Millennials are exposed to them on a daily basis.

 

Snapchat filters use special effects to turn selfies (both still and video) into an animated image of the user’s choosing, such as a cat, a dog or a cowboy. The “snaps” disappear in 24 hours. Several celebrities––particularly those admired by Millennials––are avid Snapchat users, and whether they know it or not, many act as advertisers for brands via the products visible in their Snapchats.

 

So, what’s involved for a brand to deliberately capitalize on Snapchat’s momentum? Basically, three things: investment, strategy and archives. Let’s take a look:

 

1. Investment. Sponsored Snapchat filters are supposedly worth around $750,000 per filter for holidays. Weekday filters are around $500,000. You might be wondering which brands would ever invest that kind of capital for a simple filter. Fox Studios did for “The Peanuts Movie” around the Halloween time period, as did Gatorade during the Super Bowl.

 

2. Strategy. Remember that snaps go away in 24 hours, which understandably undermines the huge price tag. It’s a huge reason that the branded filter has to be done right. Think humor, impact and the capability to create buzz, but without being over-the-top or too “in your face.” The filter should relate to the brand without being overtly focused on the product. A toothpaste brand, for instance, could produce a filter where users brush their teeth to a sparkling sheen. The goal is to make users forget the content is branded at all––in other words, a seamless experience.

 

3. Preservation. In just 24 hours after it’s posted, a Snapchat photo or video is gone. But your branded content can be preserved via a compilation video of various users interacting with the filter. If it’s good enough (and funny enough), the compilation video will be shared on other social media platforms, even further expanding exposure.

 

Last May, Snapchat co-founder and CEO Evan Spiegel estimated the company’s daily active users at 100 million. More than 65 million of them, he said, send photos or videos to friends daily. Millennials absolutely love their Snapchat, and though it’s not an easy task for brands to take advantage of this particular medium, the dividends could be huge.

For Lagging Retailers in Canada, Customer Focus Has Been Lost

Recent study shows that technology will be key to improving brand performance

 

The customer experience and giving consumers want they want is a critically lagging element when it comes to the Canadian retail industry, according to a PwC Total Retail 2016 study. The findings particularly apply to attracting, converting and retaining the Millennial demographic, a generation that’s always on the lookout for modern, simple ways to shop, especially online and via mobile.

 

In fact, over 40 percent of Millennials between 18 and 34 years old reported that they make online purchases monthly and want to seamlessly use a mobile device in the brick-and-mortar store. This underscores the overarching understanding that in today’s marketplace, customers expect a continuous experience––from browsing and product comparisons to after-purchase customer service.

 

Additionally, Canadian Millennials use mobile devices more often than the typical consumer on a global scale, with 50 percent saying they utilize a device for store coupons and promotion codes. This figure is a full 15 percent lower worldwide.

 

Cost is another influencing factor in Canadian retail. A full 66 percent of Canadians surveyed said price is a top driver when they’re shopping with a preferred retailer. However, 63 percent said they’d consider purchasing a product online from another country if the price was more appealing.

 

Here are a few more important findings from the report:

 

• 46 percent say the main reason they shop online is for convenience.

 

• 68 percent purchased their first online order more than three years ago.

 

• Almost 40 percent of respondents under the age of 34 report that social media has had an impact on their perception of their favorite brands, building respect and appreciation.

 

As the Canadian retail industry looks ahead, it seems as though technology will be at the forefront. Brands will need to re-focus their attention on the customer while improving current systems that create and blend the omnichannel shopping experience. From a seamless, personalized purchase path to stronger loyalty programs, the customer should be at the helm––and retailers should be at their service.

Grocery Shopping with Millennials

The largest generational is challenging the food industry with their take on grocery shopping.

 

A trip to the grocery is store is something many Millennials grew up doing with their parents, but it looks like tradition hasn’t won them over. According to recent research from Mintel, almost 40 percent of Millennials are opting to purchase groceries online, compared to a mere 8 percent of non-Millennials who do the same thing. The information, shared in Mintel’s report “The Millennial Impact: Food Shopping Decisions,” underscores the notion that this demographic expects products when they want, wherever they are.

 

Considering that Millennials are the largest generation (and that their spending power keeps growing), the ways in which they shop for food will extend to the food industry as well as incoming generations.

 

Where do brick-and-mortars fit in? The study suggests that Millennials tend to make a trip to the store for specialty foods, such as Trader Joe’s or Whole Foods. A full 52 percent said they don’t find conventional grocery stores as attractive an option as their speciality counterparts, which Millennials view as more authentic and more varied in ethnic choices.

 

Additionally, 47 percent of older Millennials (ages 29-38) say they tend not to trust larger food manufacturers, who often supply conventional grocery stores. Similarly, about 63 percent prefer smaller, as-needed trips to the store more often rather than stock-up sessions intended to last a long period of time.

 

The fact that many Millennials prefer to live in urban areas also affects their tendency to shop smaller, since storage space in their homes is likely at a premium. Being a health-conscious demographic, Millennials also would rather buy fresh food when they need it, rather than something they may or may not need that’s been processed to maintain shelf life.

 

It would follow, then, that the fresh sections of the grocery store are typically where most Millennials can be found while shopping. Just over 60 percent of older Millennials focus on fresh food, followed by 48 percent of the younger group. As a whole, this generation is also more likely to try new cuisines, which helps save money by reducing restaurant meals. They’re also strongly attuned to food lifestyle choices such as vegan or paleo.

 

Perhaps predictably, mobile also plays a role. Many Millennials are using their devices in-store to jot down shopping lists (about 67 percent), research products (about 63 percent, and to consult recipes (about 57 percent, which represents a potential opportunity for branded products). Older Millennials also turn to rewards and loyalty programs and might opt for a store with more meaningful benefits. Almost 60 percent say they only shop at grocers who feature these programs.

 

The future of the food industry in relation to Millennials remains to be seen, but additional opportunities are plenty, from apps and coupons to shopping lists and scannable labels––all of which would likely resonate with this powerful demographic.

Mobile Wallets Are a Win-Win

Report shows that digital wallets are gaining popularity––as long as consumers see immediate benefits 

 

In the world of retail, the consumer wants to be first––and they respond best to marketing when there’s something in it for them.

 

At least, these are the findings of the 2016 Mobile Consumer Report compiled by Vibes, a mobile marketing firm. The study showed that consumers deliberately search for marketing campaigns that include some sort of immediate benefit, from easy-to-use coupons to customer loyalty programs.

 

The study also showed a general trend toward more consumers utilizing mobile wallets, such as Android Pay and Apple Wallet. With convenience at the heart, this technology makes coupons and loyalty programs an upfront benefit––and in some cases, they’re the reason consumers are using mobile wallets at all.

 

Here are some key findings from the study:

 

1. More than 80 percent of smartphone users surveyed rank mobile coupons as more convenient than the printout counterparts that must be physically taken into the store.

 

2. Almost 60 percent of consumers reported that their opinion of a brand would shift more positively if they received digital coupons and offers that they could save in their smartphones.

 

3. Approximately half of those surveyed said that when they click on a digital ad, they’d rather land on a mobile coupon page than the brand’s homepage, a transactional page or the retailer’s app download page.

 

4. A full 94 percent of mobile wallet users report they like saving personalized offers and coupons.

 

5. Just over 30 percent of smartphone users use a mobile wallet.

 

6. Just under 60 percent of those surveyed said they’d like to have text alerts delivered when updates on their orders are available.

 

7. Almost 80 percent of smartphone users say they’d view a retailer more positively and they’d increase their brand loyalty if they were to receive surprise rewards, exclusive content and mobile “happy birthday” messaging.

 

Jack Philbin, CEO and co-founder of Vibes, says the primary shift here isn’t in the customer-perceived value of coupons and loyalty programs, but rather how these benefits are delivered. The immediate nature of mobile delivery is a game-changer, he said, and provides big benefits to both consumers (convenience) and retailers (brand awareness and loyalty), making this form of digital consumption a win for both sides.

A Glimpse into Women’s Shopping: 7 Lessons to Learn

Griszka NiewiadomskiLike millennials, female shoppers are a valuable segment to retailers. How can brands earn their loyalty? 

 

Though generalizations can be perilous––particularly those concerning gender––it’s safe to say that a peek into a woman’s shopping cart can provide an informative glimpse into who she is and what she’s influenced by. The insight extends beyond the individual herself. What a woman purchases can also provide clues about the people in her life, such as her family, children and professional colleagues. Here are seven things to be learned from a woman’s shopping journey.

 

1. Loyalty is a two-way street. Loyalty programs and incentives give customers a reason to return while also helping the retailer better understand and tailor experiences to specific shopper preferences. Social media also plays a role. Tesco, for instance, increased its presence on Twitter to invite one-on-one interactions, which include dialogue with customers about product questions, issues, challenges and requests. This personalized communication has helped the brand overcome the perception that it’s just another faceless retailer.

 

2. A little treat is a nice surprise. According to an analysis by Baymard Institute, the average rate of shopping cart abandonment is 68.6 percent. The primary reason? Unexpected costs. Email reminders to “check your cart” give customers a nudge, but a more effective approach is to offer something that helps make up for the costs that caused purchase hesitation in the first place––think free samples, or a small percentage off the order total with a deadline.

 

3. Optimize mobile. A study by Forbes suggests that nearly nine in 10 smartphone shoppers reported a negative experience with mobile shopping. The biggest problems are difficulty navigating, inconvenient checkout, multiple steps to purchase and buttons that aren’t user-friendly. Some retailers, such as Nordstrom, have addressed these issues by implementing “one-click” purchasing in their mobile apps. Additionally, the primary functionalities are made prominent and clear.

 

4. Saying “thank you” goes a long way. A survey by CreditCards.com reports that three out of four adults tends to make impulse purchases, with women being more likely (52 percent of women versus 46 percent of men). Tongue-in-cheek post-purchase messaging might help alleviate the “fear” of an impulse purchase, such as a direct statement that references a promise safeguarding against buyer’s remorse. Giving a purchase attention, such as a dedicated “thank you” email follow-up, might also reassure customers that they made a good decision.

 

5. It’s not just about her. Not only do women influence the majority of purchases in a household, they execute most of the purchases themselves. They buy for husbands, children, colleagues and friends, from birthday presents to baby shower gifts. So, not all messaging should be targeted at the female customer herself. Product suggestions should keep in mind the breadth of who a woman buys for.

 

6. Eliminate product-search frustration. According to a study by Aisle411, approximately 13 percent of customers leave a store without the item they were looking for. Employees need to ask every customer if they found what they were shopping for, and it can’t just be lip service. If the customer searched in vain, a system should be in place to record requested inventory and alert customers when it arrives.

 

7. Leave them with a small surprise. A good customer experience is worth its weight in gold. For a woman with a busy life––family, kids, career, etc.––shopping isn’t always enjoyable; in fact, sometimes it’s just another item on the to-do list. It’s the retailer’s job to make shopping fun (or at least, pleasant), and a little something extra can do the trick. It doesn’t have to be a huge undertaking––think small gestures like free samples at the store or a nice note during online checkout.

Challenge the Status Quo to Evolve Into Tomorrow

Krzysztof (Kriss) SzkurlatowskiToday’s retailers need to stay one step ahead to ensure long-term success

For a retailer, the concept of “best practices” presents a double-edged sword. Sure, certain behaviors, actions and patterns have a long history of success in the greater marketplace, and it might seem simply foolish to consider experimenting with the unconventional.

 

But the modern-day shopper isn’t the consumer of years past, when many best practices were established. Thanks to mobile and other instantaneous influences, the behaviors of today’s consumer are proving to challenge retailers. The ability to shop anywhere and anytime is forcing marketers to ask tough questions that they haven’t had to face––perhaps ever. The courage to seek answers, though, is what will set great retailers ahead of mere good ones.

 

Good retailers might be doing OK today––they might be profitable and operating steadily. But the real question is, are they prepared for the challenges of the future? What are they doing now to ensure success later? Are they focused on the customer, or focused on themselves and the success to date of their current business? To become too comfortable with today’s status quo is a dangerous disposition for any brand.

 

In other words, self-examination and critical self-appraisal are absolutely essential for long-term success. This is especially true for high-level executives, who might be too busy looking inward at the brand rather than looking outward at the greater market, including trends and disrupters that could potentially become threats. Too much internal focus can also lead executives to fall prey to self-love; that is, failing to see where a brand could use improvement.

 

Examples of this can be seen in big-box stores that focused solely on the product side of the business. This was the model of retail before the 21st century––an intense, even singular focus purchasing, margins and brick-and-mortar stores. A successful model for big-box retail, but when disruptors came on the scene, things changed (for a glaring example, think Netflix vs. Blockbuster).

 

Many of these ideas are rooted in behavioral psychology, and especially in habits. We develop habits because they work for us, but only as long as the environment remains relatively stable. Retail today is changing very quickly, particularly the way consumers shop. Generally speaking, habits don’t really have a place in retail anymore.

 

Here are five ways to avoid falling prey to becoming stuck in yesterday’s landscape.

 

1. Visit stores. Get out of the office (where it’s easy to focus almost exclusively on what you’re doing correctly) and do a reality check. What’s happening in the stores, the place where the consumers are?

 

2. Talk to customers. Get the real scoop from who’s shopping around, not what back-patters might be telling you.

 

3. Get in touch with millennials. Executives typically don’t fall into their own consumer demographic. That’s OK, but it’s important to talk with millennials to really understand their path to purchase.

 

4. Seek out a different perspective. Individuals in senior management tend to be similar among themselves––same age, ethnicity and often, point of view. This can preclude them from asking new questions and examining different perspectives, which could provide a game-changing direction for the business to evolve.

 

5. Challenge all the time. Don’t assume the status quo is the correct course of action. Even if something seems obvious, try to find a different solution––if only for the practice of doing so. Because one thing is for certain: somebody else is.

Teen Retailers, Take Note: Your Customers Love Their Phones

David Burbach Rarely invested in but hugely important, the mobile retail experience matters to teens  

Here’s an important message for teen apparel retailers: mobile, mobile, mobile.

With millennials and teens spending more than 80 hours a month on mobile devices, brands like American Eagle, Abercrombie & Fitch, Aéropostale and more have hobbled to catch up to innovation in mobile retail––a sector that resulted in $35 billion in sales in the U.S. last year.

Now, these brands are rushing to either enter the mobile landscape altogether or at least shift their mobile strategy in an effort to remain relevant. These changes include everything from building online purchase capabilities to creating edited music playlists on mobile apps. And mobile consumerism is growing––according to Accenture, 40 percent of consumers last year used their phones to execute product searches, a 4 percent increase from 2014.

Re-purposing a retailer’s desktop site to mobile is not an ideal solution, but it’s what many retailers aimed at teens have done, said Julie Ask, VP and principal analyst for e-business and channel strategy at Forrester Research. What does an ideal solution look like? It blends the brick-and-mortar customer experience with the mobile experience, creating a cohesive, seamless brand that provides a 360-degree view for the consumer. Effective, yes––but also expensive, and few brands have committed to fully investing.

Retailers who have been more forward-thinking with mobile strategy include Sephora, Target and Home Depot, who among other efforts have rewarded customers with mobile coupons to be used in stores. Sephora even created a virtual feature for customers to “try on” different shades of lipstick within their popular app.

Mobile endeavors might be easier for retailers who don’t do business almost exclusively with teens, a fickle demographic that’s choosy about which apps to download (and thus relinquish prized phone storage space to). According to a recent RetailMeNot report, 73 percent of shoppers have two or fewer retail apps on their phone. This might be the case because consumers expect a fairly significant tradeoff if they download an app––in other words, they’d like to get something back from the brand.

Some teen retailers, such as Aéropostale (who recently said 13 percent of its corporate staff will be laid off after the brand reported two consecutive years of losses), rely on a simplified, pared-down version of the desktop site for mobile. Abercrombie’s mobile experience feels a little bit more tailored, with thoughtful additions like an easily located playlist on its own tab. American Eagle’s mobile effort seems to be the most advanced––it even includes a barcode scanner for consumers to use in-store.

These tools and tricks might be nice, but ultimately, they’re bells and whistles that don’t actively contribute to strongly differentiating the brand, which is really the point of mobile entirely. As teen brands move forward, they’d be wise to step up investments in mobile and take a more comprehensive approach to weave in social media, the physical store experience, and customizable features.

How Public Relations is Making a Comeback

 

Models of PR from years past aren’t applicable in today’s marketplace

Although public relations is typically part of any advertiser’s org chart, it’s not always been clear which role PR plays exactly––or at which point in the campaign process it should step in. Nor has PR enjoyed the accolades that other functions of advertising do. But as the landscape of advertising changes and consumers can skip, block or otherwise choose not to see ads, PR is emerging as a strategic necessity––and its role is becoming clearer.

 

The internal PR team at Coldwell Banker and CooperKatz & Co. spoke at the Consumer Electronics Show in Vegas last month about how smart home tech will have an impact on residential real estate, both buying and selling. The teams were challenged to create a three-year strategic plan that challenges conventional notions of PR. More and more, they found, clients are realizing that marketing is a multichannel effort that depends on both digital platforms and places to experiment with what works and what doesn’t. This has led organizations broadly to lean more heavily on the PR function to create and develop ideas that accelerate the pace of marketing.

 

Well-informed consumers who are willing to research extensively before buying are another reason PR is stepping up its game, according to Peter McGuiness, CMO for Greek yogurt brand Chobani. Being quick on their feet from a PR perspective has helped the company compete against similar brands that spend more.

 

Global PR powerhouse Edelman is now starting to work with brands and ad firms right at the beginning of the process, rather than later on. The agency is working closely with Adobe, for instance, to create digital activations for their creative products. This earned Edelman the Gold PR Lion in 2015 at Cannes for the Adobe Photoshop “Murder Mystery” campaign.

 

What’s next? One challenge might be getting other functions to understand and adapt how PR should work in an ideal world. Claudia Strauss, CEO of Grey Activation & PR, says her firm trains its entire staff to better educate them on what works beyond paid collateral.

 

Edelman is focused on creating a new, holistic strategy that doesn’t resemble the traditional PR agency of the past––but without becoming an ad firm. The idea is to build on the talent of specialists in different areas to complete a marketing idea in its fullest form. Doing so will extend reach beyond media relations, and hopefully, directly to the consumer themselves.