Is Taggle the next big thing?

March 11, 2009

DISCUSSION TOPIC

Retail TouchPoints: Taggle Brings Mobile Bids to Brick & Mortar Stores 3/11/09

TOPIC SUMMARY:

“Taggle” is a new concept designed to allow consumers in a brick-and-mortar retail store to bid on items in a no-hassle way via the mobile device. While designed to work optimally for the iPhone and iPod touch, Taggle can also work for owners of other phones via SMS messaging. In September 2008, the Consumer Electronic Association selected Taggle as one of 15 finalists worldwide as one of the most innovative applications of 2008.

“Haggling is a reality of the retail environment,” said Michael Brophy, vice president of product strategy for Sysgain Inc., the developer of Taggle. Mr. Brophy introduced an “elastic pricing” concept, which, he said, will ultimately mitigate margin loss. The retailer with Taggle controls the entire promotion, messaging, what SKUs are available, description image, quantity the store is willing to sell and at what price. Mr. Brophy said the Taggle application is not limited to the elastic pricing scheme, and can be extended to support a feature similar to eBay’s “Buy it Now” feature, so consumers can purchase on the spot at a designated price.

Without integrating with a POS system, data warehouse, UPC databases, etc., the core offering for Taggle is the piece that sits in the store. Sysgain brings in a wireless infrastructure, or can override the store’s existing one, depending on the type of existing wireless technology. An installed VPN appliance allows secure connectivity back to the Taggle data center where bids are evaluated and sent back to consumers. A back office workstation within the store is necessary for nightly reporting and to create and maintain marketing messaging. Sysgain provides in store signage consistent with each retailers’ style and guidelines.

In November 2007, Sysgain conducted a consumer survey with input from over 2,100 consumers. Those that did haggle had an average 70 percent success rate at saving $50 or more. Nearly 40 percent felt so uncomfortable about the idea of haggling that they never even tried. Sysgain recently finished taking applications from pilot retailers to develop a user base and generate buzz. “Retailers know people are using their phones in the store for purposes that are working against the retailer’s objectives,” said Mr. Brophy. “A lot of people are price shopping other retailers… let’s try to influence their behavior by giving them a network to join once they’re in the store so you can deliver your messaging.”

Discussion questions:  What do you think of the potential for Taggle or other devices promising to bring eBay-like bidding to the brick & mortar level? In what different ways could the application be utilized? What hurdles do you see in the technology’s adoption?

My post: 

My initial reaction after reading the articles is this is a terrible idea.  I can’t imagine wanting to ‘bid’ in a store environment.  However, I think this technology will appeal to the current teen and twenty-something techno-savvy population which tries every application offered on Facebook and on their iPods.  I would be concerned as a retailer to be an early adopter, but it could be something interesting to pilot in an environment like Best Buy (technology is already assumed in the experience) or Urban Outfitters (concentration of ‘cool’ young shoppers).  Taggle should offer to install the technology with a high-profile retailer in a few doors as a pilot – at no or low cost – and test the waters.

The message:  don’t be too quick to judge a new technology innovation, but be prudent in how it is tested.

Mike Osorio, your Dare to be Contagious! TM strategist

www.OsorioGroup.com

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13603

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Win-Win Rent Relief

March 11, 2009

DISCUSSION TOPIC

Retailers Seek Rent Cuts 3/11/09

TOPIC SUMMARY:

Sleepy’s: the Mattress Professionals recently sent out a letter to its 700 landlords across the East Coast requesting a whopping 25 percent reduction in its rent payments. The request comes as many stores across the country are also asking for and apparently getting rent concessions from landlords to help deal with the downturn.

Several landlords in the New York Tri-State area that confirmed receiving the letter said they rejected the rent-reduction proposal.

But an article in The Dallas Morning News finds that retailers outside New York City are winning concessions as landlords look to avoid dealing with empty space in a tough market. Tenants are getting free rent, downsizing their space, renegotiating lease terms and receiving more tenant improvement allowances. In some cases, leases are being renewed earlier and for longer periods at better terms.

Discussion questions:  Should all retailers expect to be able to negotiate rent cuts this year? How might the pressure for large-scale rent reductions affect shopping center operators?

My post: 

Unfortunately many (most?) retailer-landlord relationships are adversarial which only creates lose-lose negotiation results.  The forward-thinking retailers and landlords have proactively reached out to each other to discuss how to weather this storm together.  Rent reductions must be considered on a case by case basis, taking into account the trends in traffic and spending.  A typical win-win result is a temporary reduction in rents tied to traffic and spending trends with key milestone dates for review.  It is reasonable for the retailer to request temporary relief while traffic and spending remain tough.  It is also reasonable for the landlord to see the retailer’s financials to verify the situation.

The message is to aggressively negotiate in a manner that ensures the relationship is solid for the long term benefit of both landlord and retailer.

Mike Osorio, your Dare to be Contagious! TM strategist

www.OsorioGroup.com

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13605

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What to do with all those laid-off retail workers?

March 10, 2009

DISCUSSION TOPIC

Can recently laid-off retail associates still work in the industry effectively? 3/10/09

TOPIC SUMMARY:

As retailers look to cut overhead and maintain profitability during recessionary times, underperforming stores and divisions are being shuttered without hesitation. The recent closure of Sam’s Club in Canada has put 1200 associates out of work and conditions for retailers in Canada and the U.S. are only expected to worsen.

HR people must be asking themselves, “What can we do with this huge pool of workers and how many will actually be able to keep working effectively in retail?” Retailers that hire recently laid off employees need to be careful not to bring on ‘unsalvageable cargo’. Clearly, as the retail worker pool grows, HR recruiters will need to sharpen their skills to find the best talent.

Layoffs in retail seem to hit workers harder as they are not as frequent as in other industries. A simple way to find out a job candidate’s true feelings is to talk about past experiences. Bob Phibbs, The Retail Doctor, says “…the most important thing is to ask something like, ‘How did you feel about your last employer going out of business?’ If they say something general, I still want to know more.” Opening up about the past is a good way to gauge feelings of distrust and pessimism that could reduce morale.

Drilling them as to why the doors of their previous employer were shut may not be productive but open-ended questions that force them to examine their own performance may yield insights.

“I think we can all agree being let go under any circumstances is rough. Do you think there was anything you could have done better while you were there?” …is a question Mr. Phibbs would pose to a potential candidate. “The ones I would consider hiring will come up with something; anything that they think could have been better,” he added. “I’m looking for personal responsibility in the question. If it’s all ‘I didn’t do anything – it was them,’ avoid them like the un-ironed shirt they probably showed up in.”

You can effectively gauge a candidate’s enthusiasm level and thought processing ability by how well they deliver their answers.

Discussion questions:  How should hiring managers and recruiters deal with the onslaught of unemployed retail workers? Is it possible to still find enthusiastic associates that will represent the brand positively? How should HR modify its interviewing tactics to be sensitive to the recently laid off?

My post: 

My view is that nothing has changed except the quantity of available candidates.  I agree that a candidate’s ability to articulate what they could have done to be more effective in a previous role is an important indicator of whether they own their own performance or “blame” others.  But this should have always been a part of the interviewing process.  Hiring managers should focus on the best hiring practices that will hold true in any hiring environment:

  1. Understand the talents necessary for success in the position you are hiring for.
  2. Understand the mix of talents in the team, necessary for team performance
  3. Develop interviewing questions that provoke answers that signal whether the candidate has the talents you require.  Hire only those that meet your criteria – never hire out of expediency or desperation.
  4. Ensure an on-boarding and ongoing development strategy that creates emotional bonds and helps deter the ‘quick turn’ phenomenon wherein most retail turnover happens in the first 18 months.

Mike Osorio, your Dare to be Contagious! TM strategist

www.OsorioGroup.com

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13600

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Thank you for visiting my blog!  Please subscribe using the RSS button and comment on my postings.  Comments are the life-blood of any blog and I appreciate yours!


Cutting hours evolves to cutting days

March 9, 2009

DISCUSSION TOPIC

Survival Strategy: Cutting Store Days 3/9/09

TOPIC SUMMARY:

After decades of being open seven days a week, Portland-based retailer Kitchen Kaboodle is closing its doors on Mondays, Tuesdays and Wednesdays in order to survive the downturn. The owners figures that with consumers only buying on sale, the cost savings from closing the doors on those days will enable the company to bring in lower prices on the other four days of the week.

“What our customers want and what everybody wants is lower prices,” John Whisler, a co-owner of the five-unit kitchen appliances chain, told the Portland Business Journal. “We were thinking, if that’s the ‘new normal’ and everybody wants everything on sale, we as a retail business, and locally-owned one, feel we need to get people what they want.”

If the store just slashed prices across all days, it would lose money. Monday, Tuesday and Wednesday have long been the stores’ slowest days. The savings come mostly in labor costs.

Every item is now discounted 10 percent to 50 percent across the store, with lower-margin products getting the smaller discounts. Mr. Whisler said the stores’ prices are now lower than many big chains like Crate & Barrel.

Mr. Whisler admits the idea is a “bold step” but is really a logical reaction to the marketplace.

“I think we all, in any business, get invested in how we’ve done things. You think we’ll just tough it out and trim here and cut here and hold the line on this expense. But after a while in this economy it’s pretty challenging,” he said. “We don’t want to be just limping along. We want to be seen as the place that gives people what they want.”

Discussion questions:  What do think of closing down a store a few days a week to bring in lower prices the rest of the week? Is this just an option for smaller chains or can larger ones benefit from closing doors on slower days?

My post: 

Many retailers and shopping centers are cutting back on operating hours to remove operating costs from non peak hours.  Kitchen Kaboodle is taking this to the next logical step – closing completely on unproductive days.  The people who would normally shop on Monday through Wednesday will be inconvenienced, but their numbers were clearly not material to the business.  It will also be easier to hire and retain a committed workforce who can have a clear work schedule and even have 3 days to consider a second part-time job if they choose.

Having given these positives, the strategy will only work for small chains – most landlords would not tolerate a closed storefront 3 days a week.  The store competes more with higher end stores vs. Walmart so I’m not sure if “price” should be the foundation of their marketing.  This type of product sells due to an inspiring environment and shopping experience.  This will be interesting to watch.

Mike Osorio, your Dare to be Contagious! TM strategist

www.OsorioGroup.com

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13598

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Thank you for visiting my blog!  Please subscribe using the RSS button and comment on my postings.  Comments are the life-blood of any blog and I appreciate yours!


Do we need to learn Mandarin?

March 3, 2009

DISCUSSION TOPIC

Tesco Chairman Promotes Mandarin Lessons 3/3/09

TOPIC SUMMARY:

David Reid, chairman of Tesco PLC, criticized the U.K. educational system for not teaching enough Mandarin in its schools. According to Mr. Reid only 10 percent of schools in the U.K. offer language lessons in Mandarin as part of the curriculum.

According to a report by The Scotsman, Mr. Reid told an audience at the headquarters of the Royal Bank of Scotland, “This has to change. The unprecedented speed and scale of changes in China means the U.K. cannot afford a slow transformation, as that will deny British young people the support they need to best prepare them for a future in which China will play a big role.”

Mr. Reid has the support of Gordon Brown, the British Prime Minister, in seeking to expand Chinese language and cultural programs. Mr. Brown said in January, “If we are to make the most of our relationship with China, we need to understand China better, through our schools, universities, cultural institutions, our businesses and in government. I am determined to do that.”

Discussion questions:  How critical is it for Americans to learn Mandarin for U.S. businesses to remain competitive in the future? Are there other languages that are equally or more important for American workers to learn? Is the American educational system adequately preparing students for an increasingly global marketplace?

My post: 

English standards in American schools must improve markedly.  English will remain the primary language of business for the foreseeable future.  However, learning a second language is also a critical skill – not only for working in an increasingly global workplace, but also for learning about world cultures and helping to avoid fundamentalist attitudes.  Mandarin, Hindi, Arabic and Spanish would be the key languages for helping ready our youth for possible international work opportunities – but any of them will do for the purpose of expanding minds and hearts.

Mike Osorio, your Dare to be Contagious! TM strategist

www.OsorioGroup.com

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13587

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Thank you for visiting my blog!  Please subscribe using the RSS button and comment on my postings.  Comments are the life-blood of any blog and I appreciate yours!