Retail
By: Mitch Lucas
April 27, 2010 | No Comments
As sustainability becomes a more prevalent concern in the operations of organizations, companies are constantly looking for ways to reduce their consumption of resources. Businesses take different approaches to achieving this goal. Some companies look for ways to reduce the size of their packaging or to reduce their consumption of fossil fuels. Others, however, seek to reduce or eliminate their waste.
While digital on-demand printing does not solve the world’s resource problem, it does allow companies to reduce the economic and environmental burden of over production for their campaign execution. Print production methods such as offset, screen, rotogravure and flexography require large production runs to offset the cost of setup and to maintain print consistency. To reduce the need to reprint, companies authorize 5% to 10% overruns to account for the loss and damage of items during the execution of a marketing campaign. Digital on-demand printing, however, allows companies to print exactly what is needed and to economically replace single items with consistent print quality when necessary. Thus, there is no excess consumption of resources to produce items and there are no excess materials to dispose of in the landfills.
Let me know how your company is reducing its consumption.
Permalink | Tags: (consumption, digital print, flexography, offset, on-demand print, print, print production, rotogravure, screen, sustainability)Add Comments | View Comments (0)
By: Doug Fergusson
April 14, 2010 | No Comments
It’s easy to forget that much of what’s practiced in today’s retail business is based upon a foundation that was set over the last 100 years. While there has been an introduction of technology, such as bar scanning and sophisticated inventory management systems that have improved operations and service, basic marketing techniques have remained relatively unchanged.
Mass media (TV, radio) is still a large portion of marketing spend, and direct-to-consumer communications are primarily non-personalized Free Standing Inserts (FSI’s) and mailers. On-premise marketing also continues to be centered on POP signage that directly supports national campaigns with little or no localization.
All of these practices ignore changing consumer behaviors. The New Consumer expects retailers to speak to their individual interests and preferences. This is true of direct-to-consumer communications, as well as on-premise signage at a specific store. These New Consumers want to feel a sense of relationship to the places they frequent. Walking into a store and seeing signage that speaks to your interests and lifestyle gives you a sense of ownership in the store. That ownership can mean the difference between a retail location being a convenience or a destination.
Responding to this need requires a rethinking of the retail space and the way you communicate with customers — both within the store and directly. Consider these ideas:
- Customize each store’s menu boards so it features local customer favorites
- Add signage that speaks to local events (high school teams, concerts, etc.)
- Include signage in other languages that appeal to local demographics
- Localize store signage to reflect community tastes and interests (specific products or traffic patterns)
- Frequently rotate the store’s graphic themes with changeable graphic panels (perhaps with graphics that reflect the community)
- Integrate direct-to-consumer communications (mail, e-mail) with store signage
- Build completely personalized direct communications (graphics, messaging and offers) based upon specific consumer preferences and community themes
There are other ways to create a sense of relationship with your customers. Many marketing campaigns may seem difficult or expensive; however, having the right partners to execute them can make this easy. Focus your attention on expanding your creative thinking and the rest will fall into place.
New Consumers aren’t just interested in relationships; they also have a thirst for new things to talk about in order to feed their social media habits. In my next blog post, I will discuss why agility should be a cornerstone of your marketing program.
Permalink | Tags: (best practices, Local Marketing, marketing, New Consumer, Retail)Add Comments | View Comments (0)
By: Mike Snyder
April 7, 2010 | No Comments
image from PRNewser
For the month of April, we’re dedicating our topics of discussion to Restaurant and Retail Industry Trends.
To combat economic challenges, restaurants and retailers have created innovative ways of reaching customers. Some brands are honing in on shopper experience, while others concentrate on price reductions, health conscious consumers, local marketing and eye-catching promotions. We’ll cover these points and discuss the unique challenges of getting great marketing ideas from concept to in-store delivery in the most efficient and cost-effective manner. Last, we’ll touch on sustainability in print to commemorate Earth Day on April 22.
As always, we encourage you to share your thoughts and opinions through commentary.
Permalink | Tags: (Industry Trends, marketing, promotions, QSR, Retail)Add Comments | View Comments (0)
By: Doug Fergusson
March 29, 2010 | No Comments
The execution of large scale POP marketing programs has been a challenge for decades. Most retailers respond to these hurdles by developing extensive processes and procedures that are considered today to be the “proven” approach. While these entrenched methods may be perceived as safe, most oftentimes they are far from ideal as they have not evolved with changes in the retail environment. Are your proven approaches really the lowest risk if they harbor waste and inefficiency?
The execution of POP campaigns can be divided into several overlapping phases:
- Marketing Strategy – The practice of determining which products are of interest to consumers and how they will be sold, communicated and packaged.
- Creative Development – The process that translates the marketing strategy into graphic messages that can be published for printing or online use.
- Profiling – The process of matching specific marketing messages and POP elements to each store.
- Production – The translation of the creative work into actual POP elements.
- Fulfillment – The assembly of a group of specific POP elements that match the exact needs of a retail location into a POP “kit.”
- Shipping – The transportation of each POP kit to each retail location.
- Receipt and Installation – The receipt of the kit followed by the installation of POP elements prior to the start of the promotional campaign.
In practice, these steps tend to be chaotic and very dynamic; it is not unusual for retailers or QSRs to have hundreds of changes throughout the course of a single campaign. Meanwhile, the traditional buying practices of these companies tend to fragment these processes further as they seek to buy at the lowest price. The individual components may be at the lowest cost, but the net result is an inefficient and wasteful workflow.
Consider these opportunities:
- Speed – Based on my experience, more than half of the time consumed to execute a POP campaign is spent waiting for one party or another. What is speed-to-market worth to you?
- Cost – So much focus is placed on the per-piece cost of POP materials, and so little is placed on the total quantity ordered. Does every location require exactly the same items? What is the cost of the “extras” left over after a campaign because you are afraid to run out?
- Time and Focus – How much time does your organization spend trying to coordinate the overall process? Would that time be more valuable spent on your customers?
- Effectiveness – Do your marketing messages speak to local preferences? Are you keeping your campaigns simple just so they are easier to execute?
Consolidating the execution of multiple phases into a single qualified supplier provides the focus that is necessary to attack the inefficiencies inherent in this chaotic process. The cost and time savings that are derived can be sizeable; I have seen some companies save over 20% of the cost of their POP program by rethinking the entire process.
The consequences of something going wrong in a POP campaign can be very ugly, so it’s natural to want to hold on to your tried and true approach. However, the retail environment is changing and the opportunities for cost savings and improved speed, flexibility and effectiveness can make it worthwhile to leverage the synergy of services.
Permalink | Tags: (campaigns, marketing, POP, print fulfillment, production, profiling, QSR, Retail)Add Comments | View Comments (0)
By: Doug Fergusson
March 16, 2010 | No Comments
The “New Consumer” is generating a lot of buzz in the retail community, but who exactly are they talking about? The term is being used to describe a range of changing consumer behaviors that are the result of several trends colliding:
- Generation Y (ages 10-27) is beginning to drive retail trends
- Social media has become integral to social interaction
- The Internet is the starting and ending point for most purchases
Gen Yers are becoming influential because of their numbers (they are the offspring of Baby Boomers) and their ages (teens and twenty-somethings have incredible buying power). Because of their emerging leadership position, nearly everything they want or purchase becomes fashionable.
Gen Yers are quick adopters of technology and have made the Internet and social media a way of life. They are more likely to text someone than to call them; they use social media such as Facebook and Twitter more than email; and they spend much more time surfing the Internet than watching TV, according to Forrester’s report, “Building Gen Y’s Multichannel Media Profile.”
Many consumers now use the Internet for virtually every purchase. They research products online, often using blogs and forums for additional product information or reviews. They use the Internet to purchase products they will pick up at a brick-and-mortar store (including QSRs). And whether consumers like the product or not, many are eager to post their opinion online, influencing thousands of peers in minutes.
This different way of communicating and socializing is creating some New Consumer needs and eliminating others. It is also changing the retail game when it comes to marketing to these New Consumers. How do you respond to this changing environment? Localizing your store messaging based upon store-specific profiles is one way to speak to New Consumers.
In my next blog, I will explore some ideas about responding to New Consumers.
Permalink | Tags: (consumer behaviors, Generation Y, localizing your store messaging, New Consumer, QSRs, Retail, store-specific profiles)Add Comments | View Comments (0)
By: Glenn Haertel
March 15, 2010 | 1 Comment
Even the most creative in-store promotion won’t be successful unless it’s executed properly – and that means it’s quickly delivered to the right place, in the right quantities and in perfect condition. This seems simple enough, but large QSRs and retailers who have thousands of locations, that are all unique in some way, understand the complexity of this task. The critical components of execution — print, fulfillment and shipping – must work together in what I like to call a “synergy of services.”
Throughout the month, we will be examining the issues around “synergy of services,” and how it can lead to greater efficiencies, reduced costs and more time to focus on your core business. We’ll be hearing from industry experts about best practices and innovative solutions that can help your business grow. So join the discussion. We want to hear from you!
Permalink | Tags: (fast casual restaurants, fulfillment, print, QSR, Retail, shipping, synergy of services)Add Comments | View Comments (1)
By: Doug Fergusson
January 26, 2010 | No Comments
I was fortunate to attend the National Retail Federation Expo in New York on January 11-12. I had not attended for a number of years so it was quite fascinating to see what has changed and what has stayed the same.
On the surface, the show continues to be a retail technology showcase; however software, not hardware, has become the centerpiece of the show. I was surprised to see that some of the same business problems that challenged retailers 20 years ago (POS automation, supply-chain management, etc.) are still a focal point of many of the solution providers. There was one clear emerging trend that appeared throughout the conference – retail is changing from being supply-chain driven to consumer focused.
Over the last 20 – 30 years, most retailers’ investment in technology and management attention has been focused on supply-chain optimization. I don’t think anyone was suggesting that this was wrong; after all, getting the right goods, to the right place, and the right time is essential to good retailing. It’s just that a lot of people are now saying the game has changed.
Consumer-centric retailing focuses first on the customer experience and then builds everything from that starting point – product/menu offering, retail environment, marketing, customer service, etc. Some think that changing this focus is necessary to respond to what is believed to be a fundamental shift in consumer motivation. The idea that many consumers, particularly active social media participants, are driven to retail more for the experience and less to buy “stuff” is very significant.
I can’t say that I have fully digested this concept and what it might mean to retail. However, it does raise some interesting ideas, some of which were mentioned at the show:
- Localization – Stores that are merchandised (product, price, signage) uniquely to reflect local consumer tastes and interests
- Pop-up retail – Portable “stores” that can be moved by truck throughout the day
- Temporary stores – Stores set up for short periods (days or weeks) in response to local market events
- Theatric spaces – Stores that have been designed as “must see” destinations with extreme art and architecture
- Dynamic environments – Retail spaces that change frequently (weekly, daily or even throughout the day) through the use of lighting and changeable graphics to create a dynamic customer experience.
- Fast fashion – New fashion delivered to stores within two weeks of concept
These trends point to a need for agility and speed in your marketing processes; I think these topics are worthy of future blogs posts. Let me know if you agree; send me your comments to blog@synqsolutions.com, and I’ll post them.
Permalink | Tags: (dynamic customer experience, dynamic environments, fast fashion, localization, marketing, National Retail Federation Expo, pop-up retail, product offering, retail environment, solutions, supply chain, technology, temporary stores, theatric spaces)Add Comments | View Comments (0)
By: Doug Fergusson
November 17, 2009 | No Comments
Consider this: One of our customers changed all of the signage and brochures from English to Spanish-only at selected stores that were located in areas with a large Hispanic population. The change worked as those stores are now among the best performing in the nation. The lesson here is that Local Marketing works if – and only if – the messaging is relevant to the audience.
So how do you make your Local Marketing messaging relevant? I’d begin with Segmentation. In other words, what do you know about the consumers who visit each location? Is there a concentration of one or more ethnic groups? Are there certain age groups that frequent your store or restaurant? Is English a second language to a large number of your customers, and if so, what is their primary language? Are there different groups visiting at different times, such as professionals in the morning or soccer moms at lunch?
Once you collect data about current or potential customers, you can use it to build your Local Marketing campaigns. For example, if you have a large number of Hispanic customers, you may want to have Spanish or bi-lingual signs for a given location. You also may want to promote different products that meet customer preferences, such as ice tea in the south. Alternately, you might want to promote speedy service to busy professionals.
Messaging can be as involved as you would like. It can be one-dimensional, meaning that you speak to just one customer attribute (i.e. customers 18-25) or it can be multi-dimensional (i.e. professionals who are Hispanic). The specific attributes that you target and the level of complexity can change over time; I strongly recommend starting simple and evolving as you gain experience. However, make sure the technology platform that you are building upon is capable of handling more complex messaging.
The process of mapping location and customer attributes to messages can be time consuming. But once the rules are set, the ongoing effort drops significantly. Furthermore, linking data sources, such as POS databases, into the messaging process allows marketing strategies like localized pricing strategies to be implemented without significant management support. Speaking from my direct experience, the technology needed to deliver store-specific signage is surprisingly efficient and effective once it is set up.
Good luck with your Local Marketing efforts. If you’d like to share a success story or ask a question, please email me at dfergusson@synqsolutions.com and I’d be happy to share it on this blog.
Permalink | Tags: (localization, location, marketing)Add Comments | View Comments (0)
By: Doug Fergusson
September 23, 2009 | 1 Comment
Local Marketing programs are intended to get “better results,” but what exactly does that mean to you? Understanding who you are trying to reach and what behavior you are trying to influence, are critical to a successful outcome.
Think of Local Marketing as a series of “Micro-Marketing” events within a single store, where each campaign is targeted at a distinct customer interest. Once you accomplish this, you can start framing your objectives. While you can begin with a broad business target (for example, increasing store sales by X %), don’t count on that type of benchmark to get results. The program goals must be as specific as the local marketing campaigns; micro-marketing efforts require “micro-goals.” The goals must state who you are targeting (which customer attribute) and what behavior you wish to influence among these consumers. The more specific you can be about the who and the what, the more likely you will be able to implement a Local Marketing campaign that works.
How specific can you be about who you are targeting? Do you have customer attributes collected that help you identify their interests and preferences? (For example, “parents with young children” would be a much more useful attribute than just “parents” or “customers”) You may be limited in the amount of data that you have collected about your customers, but don’t worry. It takes time, patience and determination to accumulate this type of information. Just start with the data that you have and continue to build upon it.
Do you know exactly what behavior you are trying to influence? For example, are you trying to:
- Attract new customers into a store
- Entice old customers back to the store
- Motivate customers to return more frequently
- Encourage customers to spend more each visit
- Drive customers to buy specific items
- Encourage customers to say positive things about you
- Raise customer satisfaction
Once you have defined a list of specific Local Marketing goals for each store, you are ready to start the process of determining the how of Local Marketing: Messaging and Media. In my next posts, I will explore a range of strategies for getting real results.
As a final note, please keep in mind that Local Marketing is not an event, but instead is a process of defining the who, what and how of targeting the interests and preferences that drive customers to act. Developing this process into a business routine with the right tools can make your efforts easier to accomplish – and prove to be a significant competitive advantage.
Permalink | Tags: (marketing, segmentation, setting goals, targeting)Add Comments | View Comments (1)
By: Doug Fergusson
September 3, 2009 | No Comments
Store profiling is a critical part of local marketing. As you may know, store profiling is the process of collecting information about a retail location with the purpose of creating more targeted and relevant messaging.
There are an endless number of attributes that can be profiled for this purpose, such as:
- Physical Attributes – Store type (free-standing, mall, in-line), drive-thru capabilities, store size, layout type, etc.
- Merchandising Attributes – The types of signs, fixtures and sizes
- Product Offering – Details regarding specific product lines or menu offerings
- Price Points – Specific product prices by store
- Consumer Demographics
- interests
- age groups
- ethnic groups
- language
- Regional – Weather, landscape, seasonal
- Local Signage Ordinances – Laws on exterior banners, posters, yard signs and other marketing materials
- Location – Proximity to high school, hospital, office buildings, highway
Collecting this information is a gradual process. I have found that most clients have some of this information; however, the data often is scattered or incomplete. It is amazing how much information is available if you collect all the data held in spreadsheets and departmental databases throughout your organization. This data can be gathered and loaded into a location profiling database (Synq Solutions calls this process Intelligent Profiling) that can be leveraged immediately for marketing purposes. The idea that you can use the data that you already have, and then work to improve and expand the depth of your location profiling data is a key concept of successful local marketing.
Building your profile database is an evolutionary process. It is also one where you have to weigh the cost of collecting and maintaining data against the marketing benefits. For example, if you want to obtain a very accurate picture of the merchandising configuration of each of your stores, you could have a team of specialists visit each location and collect that data; however the cost of this approach could exceed $500 per location. Alternately, you could mail paper surveys or conduct telephone interviews to store managers at a much lower cost. While this approach wouldn’t be as accurate or complete, it may make the most business sense.
Demographic data on your customers can be obtained by analyzing population data from third-party sources or it can be collected through direct surveying of your customers. The trade-off between data quality and cost is the deciding factor.
I generally recommend that clients start by using the data they have or obtaining it at a low cost. Then, as you learn to use the information to build and execute effective marketing programs, the value of improving the data quality will be more than offset by the cost of collecting the information.
This evolutionary approach requires flexible tools, so make sure you have partners with capabilities that allow you to quickly adapt your profiling database to new approaches as your needs change.
I have explored the concept of Location Segmentation and the many ways that you can collect information for Profiling; however, doing any of this without a goal in mind is likely to end up with bad results. In my next post, I will talk about the goals of Local Marketing and how they can affect your approach to Segmentation and Profiling.
Permalink | Tags: (demographics, marketing, merchandising, profiling)Add Comments | View Comments (0)
By: Doug Fergusson
August 20, 2009 | No Comments
I’d like to explore the various components of Local Marketing by beginning with Segmentation. If leveraged correctly, Segmentation can open a windfall of Local Marketing opportunities for retailers.
Before I go any further though, I’d like to define Segmentation as the set of attributes that separates one consumer (or group of consumers) from another. This whole subject can become very confusing if we don’t separate the two major forms of Segmentation that are applicable in the retail world:
- Location (or Store) Segmentation refers to the collection of information about the population of consumers that might visit a particular retail location and leveraging this data to drive sales at that store.
- Consumer Segmentation refers to the collection of information about a specific individual and using that data to target messages to that person.
In this post, I’d like to focus on Location Segmentation, which is an emerging trend within the retail industry. In practice, many QSRs, fast casual restaurants and retailers still address their customers at the store level as a single, unified group of consumers with identical tastes and interests. However, they do so knowing that the consumers who visit each location are different from one site to another. They have plenty of data that supports this fact, so the question I am always asking myself is, why?
I believe these marketers perceive obstacles to executing Local Marketing programs, such as:
- How do you segment your customers?
- How do you collect data about these customers?
- How do you categorize, store and manage data on a location basis (profiling)?
- How do you leverage this data to deliver relevant messaging?
- How do you execute a Local Marketing campaign store by store?
Together these questions seem overwhelming and lead these marketers to oversimplify their marketing approach. This generally translates into a “one-size-fits-all” approach or store categorization approach (i.e. soccer-mom store, young geek store, etc.), both of which are very limiting. The key point is that Location Segmentation does not have to be one-dimensional; multiple and independent customer attributes can be collected and leveraged differently for each location.
Once marketers embrace the idea that an endless range of consumer attributes can be associated with a location, including age groups, ethnicity, product preferences, general interests, lifestyle, price points and any combination of these attributes, they can be leveraged for marketing on a store-by-store basis. As a result, some very interesting marketing possibilities will emerge.
All of the technology and processes needed to deliver store-specific messaging exist and are proven. They include:
- Online store profiling database tools (we call Intelligent Profiling),
- Dynamic page composition tools that can build store-specific POP
- Digital printing technology that makes it cost effective to print one sign
- Fulfillment processes that efficiently and quickly assemble store-specific kits of POP elements.
The only thing missing is the commitment to shift to a new way of thinking about marketing to customers. If marketers can make the leap of faith that the obstacles aren’t as big as they appear, the rest is very straightforward.
In my next blog, I will discuss how store profiling data can be used in practical Local Marketing efforts.
Permalink | Tags: (consumer, location, segmentation)Add Comments | View Comments (0)
By: Doug Fergusson
July 23, 2009 | No Comments
While I’ve heard the term “Local Marketing” used widely in our industry, there isn’t a consensus as to what it means. Generally, retail marketers define their Local Marketing initiatives based on the specific tactic they are using, such as local media advertising, local charities, store-specific promotions or direct marketing. Some organizations even have complete departments or field organizations dedicated to this purpose; however, whenever I ask about the details of these programs, I am met with wide-ranging descriptions of what constitutes Local Marketing. Almost always, these interpretations are far too limiting and ultimately, hamper the programs’ effectiveness.
I define Local Marketing as the strategy and actions that communicate to your customers in a manner, and with a message, that is relevant and meaningful based upon localized differences. The goal of Local Marketing is to drive favorable customer behavior as a result of this more targeted communication.
The key dimensions of Local Marketing are: Segmentation, Media and Messaging. Segmentation refers to how one group of customers is differentiated from another. Media refers to the form of communication to be used – local advertising, POP signage, coupons, direct marketing, etc. Messaging is what you say and how you say it in a manner that compels the targeted customers to act.
The success of any Local Marketing initiative depends on these elements working together, yet the sequence by which each is developed plays a key role in the initiative’s long-term effectiveness. Segmentation comes first, followed by Media selection, and then Messaging. A fourth dimension, Measurement, is essential to drive the growth and evolution of the Local Marketing effort.
- Segmentation identifies “who” you are targeting.
- Media selection determines “how” you will deliver your message.
- Messaging establishes “what” you are communicating.
- Measurement collects data that can be used to guide future cycles of the program.
Local Marketing programs can be initiated without complex segmentation and messaging, while using a single media type. However, these programs should be designed to support a more sophisticated, data-driven messaging system that will evolve over time.
Too many companies are failing in their Local Marketing initiatives because they start with mass-marketing tools and processes but can’t support further segmentation as the need becomes apparent. Local Marketing is not an event or a campaign, but instead should be a continual and evolving process.
In my next blog post, I will explore each of the Local Marketing dimensions, along with my thoughts about state-of-the-art of Local Marketing tools and processes.
Permalink | Tags: (direct marketing, media advertising, promotions, segmentation, store-specific, strategy)Add Comments | View Comments (0)
By: Doug Fergusson
July 10, 2009 | No Comments
Welcome to Executing Innovation, the Synq Solutions blog. This feature will be used to share ideas, answer questions and provide information about innovation in our industry. Look for updates on industry trends like cost reduction, localization and shifting marketing media. We’ll also address business problems, as well as specific uses of technology to drive solutions for your company. If you have a specific question or topic that you’d like to know more about, please email us at blog@synqsolutions.com, and we’ll try to address it in our next blog post.
We hope you will find this blog to be a valuable tool in your quest to stay informed about our industry. Our company is founded on technological innovation, and we strive to bring the latest ideas to you so that your company can save time and money on the execution of your marketing campaigns. Before you leave our site today, please visit the Synq Advantage, which explains how we use innovation in our QSR and retail solutions, as well as in the production of our training materials. We also will continue to publish new case studies and white papers. Please bookmark this blog and check back soon for our new series on Local Marketing, which we’ll begin posting next week. This series will explore the various meanings of “local marketing” and all of the issues that stand in the way of real business results.
Permalink | Tags: (localization, marketing, reduction, solutions, technology)Add Comments | View Comments (0)
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