Archive for May, 2007|Monthly archive page
<via IG’s TrendCentral>
With funding from Build-A-Bear, this new store is hoping to do for toy cars what the aforementioned chain did for stuffed animals. Hoping to offer a bonding experience for fathers and sons, the store will enable customers to create custom toy cars by selecting the type of car, body style, paint and sound effects, and locomotion style. Additional accessories ranging from decals to tire treads will also be available. The first Ridemakerz store opens on Friday in Myrtle Beach, South Carolina, with a second store opening planned for July in the Mall of America.
I predict this will be hot! Check out the website and see what I mean.
Its been a while since I wrote critically of Sony, but a piece by Randall Stross in this weekend’s NY Times reminded me of a similar exercise that I did a few months back with Samsung and Nokia. In his article, Stross compares experiences at both Apple and Sony’s Style stores and points out some of the reasons why Apple is so wildly successful and Sony is not. Here are Stross’s key points with my commentary:
People vs Product: Everyone knows the Apple story. Over half of the store’s staff is dedicated to post-sale service; Free, one-on-one consultation, with “Geniuses”. This recognizes that your engagement with a brand is only starting at point of sale. The real engagement is made or lost as you use the product. Apple makes sure that you are going to get the most out of it. As a side note, they also get the concept of Marketing as Storytelling as demonstrated by “The Geniuses”. Sony, on the other hand, is all about the thing itself. They have a much broader product line of electronics, which could give them an advantage over Apple if they focused on the value those things can bring to your life, but instead, the engagement exercise is all focused on the pre-sale marketing of the stuff.
Function vs Fashion: According to Dennis Syracuse, senior vice president for Sony Retail, the Sony Style stores are intended to be a “fashion boutique for women and children” that incidentally happens to carry electronics instead of clothing. Wow, that seems a bit shallow. How successful are you going to be targeting women who only want that red notebook because it coordinates so well with their outfit?
Engaged vs Disengaged: Stross describes the experience of walking past a number of Sony employees who were “so engaged in a private, and apparently amusing, discussion that <his> imploring presence failed to draw anyone’s attention.” He speculates that they have become so used to inactivity in the store that had “become accustomed to busying themselves with their own entertainments.” At a nearby Apple store, the employees were always alert and attentive, despite being very busy. I’ve been in a lot of Apple stores and this just seems to be part of the culture. For Apple, some of this has to be due to the enthusiasm of the owners to the products themselves. Engagement can be a circular thing. Engaged customers tend to make employees more engaged and visa-versa. Regardless of the source, the engagement is real and is a huge differentiator.
Stross closes the article suggesting that perhaps a key differentiator IS having some amazing piece of hardware (running Windows) which will bring in the people. Once they are in the store, they might see the other products in a different light. This is where I think Stross misses the point. Sure Apple has great products that people are passionate about, but it’s not because of their technical specifications, its the experience delivered by the product, the store and the employee.
What do you think? If you are a retailer, do you get it?
I was pleased to see that Wharton’s Jay H. Baker Retail Initiative along with Canadian consulting firm, the Verde Group, had conducted the second of what is now an annual study of retail customer dissatisfaction. If you are a regular reader, you know I have written about this before. The big takeaway from this year’s study is that the most impactful area of dissatisfaction comes from interactions with the sales associate.
The study found that disinterested, ill-prepared and unwelcoming salespeople lead to more lost business and bad word-of-mouth than any other management challenge in retailing.
Of the 1000 shoppers surveyed about their most recent shopping experience, 58% indicated that they had either been unable to find an associate to help them or were outright ignored by the sales associate. The survey identified a number of other sources of dissatisfaction including inadequate parking and out of stock product, but shoppers were much more likely to forgive these problems than they would bad sales help.
As identified in last year’s Consumer Dissatisfaction Study , customers are much more likely to share a bad experience than a good one. Half of all shoppers have chosen not to visit a particular store because of someone else’s bad experiences. According to Wharton marketing professor Stephen J. Hoch, director of the Baker Initiative:
“The importance of consumer dissatisfaction, rather than satisfaction, is the fact that a negative experience leads people to want to go and talk it. They are less apt to talk about it when things go well.”
The study also revealed differences in attitudes based on age with the coveted 18-29-year-old demographic reporting the highest number of bad experiences. The key reasons: Lack of authenticity, lack of knowledge and inability to find things due to a disorganized store.
The study also gathered information regarding the types of characteristics that would be found in an ideal sales associate. The top two were “engager” (willing to stop whatever they are doing to help) and “educator” (someone who can explain products, make recommendations, etc).
Both last year’s and this year’s studies should be required reading for anyone in retail today. After you read what shoppers are saying, give some serious thought to how your sales associates are interacting with your customers.
For the last year, I have been a regular Panera Bread customer. With my wife and I having increasingly busy schedules we, like many Americans usually don’t have time to cook dinner. Panera has a nice selection of soups and salads that work well for a quick evening meal. Panera rotates their soup selection daily, but provides a link on their website showing the soups of the day. That should make it easy, but only if the local restaurant consistently executes. As you may have guessed where I’m going with this, my local restaurant is only consistent at being inconsistent.
Tonight, my wife checked the Panera menu, saw they had a soup she likes and asked me to pick it up for her. I’m a nice guy and even though I’ll be up all night working on a presentation, I hopped in the car and went up to the local Panera. Walking in, I spied the soup menu. Conspicuously absent was the very soup that I wanted; a soup listed on their national website menu as being featured today. This is not the first time this has happened. In fact, my experience has been that the available soups in my local store frequently don’t match the website. Of course, there was only one cashier working at 6:00pm and there were 4 people in front of me. Being an optimistic person, I waited in line to confirm what I already knew.
NO SOUP FOR YOU!
When I asked the cashier, an innocent enough young man with the personality of a stump, if they had the soup, his answer was simply “No”. That’s it. So I got back in the car and drove 5 miles to the next closest Panera. Fortunately, they had the soup I wanted, but did not have all of Tuesday’s advertised soups.
Seems petty to make such a big stink about a $4 cup of soup, but imagine for a minute if McDonald’s was consistently inconsistent in having french fries or Coke available. What if Hertz was consistently inconsistent in having midsize cars? What if whatever company was consistently inconsistent in delivering an advertised product or service?
It wouldn’t take too many occurrences of missed expectations before you would stop being a regular customer. The next time I need a quick bite to eat, Panera will not be on the top of my list.
Consistent retail execution is difficult, especially across 1100 locations (including franchises), but it’s really important. I don’t know if the failure to execute consistently in my local Panera is representative of the overall chain, but that really doesn’t matter to me as a customer. What is clear to me is that Panera is not managing this little problem at my store and as I recently wrote, ensuring that the little things are done right (like having the soups listed on your website) is critical to driving loyalty.
Steve Ballmer says, “There’s no chance that the iPhone is going to get any significant market share. No chance.” Predicting the future of the iPhone is perfect bait for marketing pundits everywhere. How about a pool and we’ll see who’s as smart as they pretend to be? So, I invite you to make a prediction, trackback it here and a year from now, we’ll take a look.
I agree with Seth; the iPhone will be big this year and even bigger next year. Here’s why:
- People, especially young teens, are totally engaged with the Apple brand.
- The cell phone and the iPod are probably the most important possessions a young teenager has.
- It will be the ultimate aspirational gadget for young teens. Having the coolest iPod and phone are status symbols for them; they get you attention. If someone else has a RAZR, you will drive your parents crazy begging for one, even if you have a perfectly good phone (voice of experience talking)
What do you think?