Thursday, December 18, 2008

The last shopping days before Christmas

'Twas the last days before Christmas, when all through the stores
Not enough customers were coming thru the sliding front doors.
The shopping carts were arranged in a tidy neat row,
Awaiting frenzied shoppers to spend lots of dough.

The registers were staffed by an anticipating crew,
With hopes that paying shoppers were surely soon due.
And the manager with keys and the new hire named Don,
Had just checked the front sign to make sure it was on.

When out in the parking lot there arose such a stew,
Employees rushed to the windows to see the new view.
Away from the panes they returned to their places,
With not a grin but frowns on their faces.

For it was not future buyers making the fuss,
But just a trash truck and a big passing bus.
Now time was short to start making sales,
Discounts and coupons should cure all that ails.

But customers still did not buy in quanities sought,
Retailers scared of low revenues from products not bought.
Wishing but knowing that holiday earnings wouldn't be stout,
But in the back of their minds, Congress might bail them out.

Maybe this is a time to just try to scrape by,
And come back December 26th to give it another try.
For then unwrapped gift cards will be burning a hole,
In wallets of shoppers ready to give it another go.

To get what they want, to make post-Christmas hay,
Let's hope they spend until this New Year's Day.
Retailing is tough, this holiday season two thousand-eight,
Let's just survive and see next year's fate.

So from the advertisements giving it one more last try,
"Happy Christmas to all, and please from us buy."

Monday, December 15, 2008

Marketing the "when and where"

Taking into account the when and where you are should influence marketing tactics

Scenario #1
If you were a dentist at the opposite end of of a strip mall from a coffee shop, how could you get new patients?

Scenario #2
If you sold coffee, how could you compete with Starbucks on its home turf in Seattle (or any place else, for that matter)?

Though there are various methods to approach each of these scenarios, the marketing tactics selected should take into account where and when the firm is dealing with customers.

A "where" approach to scenario #1
With the drive-thru lane of a popular coffee shop directly behind a dentist's practice, the dentist used the "where" of the practice as an opportunity to communicate with potential patients.

A "when" approach to scenario #2
McDonald's is taking a direct "when" tact in promoting its espresso via billboards in the Seattle area with messages such as "four bucks is dumb". The current economic climate provides an interesting "when" opportunity for McDonald's to move into Starbucks turf with a lower priced product.

Image from 12-15-08 USA Today, 4B
Addendum to original entry -
December 17, 2008:

Another example of a "when" situation dealt with via marketing

What does a retailer do when a major winter storm stops consumers from coming to a major sale? (At least that's what the retailer hoped was the reason.)

Last weekend, a major winter storm negatively impacted a major pre-Christmas sale at a local Macy's as shoppers failed to brave single digit temperatures. Macy's announced a continuation of the sale... and even blamed it on the storm! Below is a portion of the newspaper advertisement announcing the extended sale.

Tuesday, December 2, 2008

Lower prices plus

This holiday season, consumers are being flooded with so many "price deals" that it is difficult for a business to stand out from competitors.

Economic news is making consumers skittish. It seems that little is certain in the financial arena except that the values of their homes and 401k plans are both down. Bail outs of American business institutions seem to come on a daily basis.

Some good news... Gas prices have dropped by more than half from the summer highs of over $4 per gallon last summer.

The bad news? While nice to have more money left in pocketbooks and wallets after a fill-up, it has not been nearly enough to bolster shaken consumer confidence.

A textbook business response
In an attempt to attract such jittery customers, many businesses have lowered the effective prices on various products by offering sales and coupons. However, since so many retailers are doing the same, buyers have numerous options offering lowered prices. In addition, an environment of intense price competition -- where competitors keep lowering prices to match or beat other stores -- can "teach" consumers to wait to make a purchase. In this type of situation, consumers learn that postponing a purchase results in better (from their perspective) prices by giving retailers more time to keep lowering their prices.

Offering more than just lower prices
Some retailers have started to offer consumers "lower prices plus". The "plus" can be wide ranging -- including higher quality products, more service, better product selection, a better return policy, and so forth. In our lower price retail environment, the purpose of the "plus" is to give prospective buyers a reason to buy from that retailer and even possibly give consumers a reason to buy sooner rather than later.

Currently, Best Buy is doing this.

Best Buy is in a highly competitive market space... they compete with a wide variety of businesses such as Walmart, Costco, national department stores, and local electronics stores. Lower competitive prices are widely used. This retail space is so competitive that former Best Buy competitors Circuit City and CompUSA are either downsizing or are no longer in business.

Best Buy's current television advertising campaign "You, Happier." exemplifies the "plus" strategy. The thirty second spots each feature a "Blue Shirt" (Best Buy employee) sharing a brief story that shows how their product knowledge and empathy for people helps their customers. With Best Buy's assistance, you can be happier. Now that's a "plus".

Example A: Connecting grandpas and grandkids

Example B: Needing the perfect gift

Example C: Great gift ideas