The New Target.com….oops?

September 20, 2011

DISCUSSION TOPIC

New Target.com – 09-13-2011

September 13, 2011

Through a special arrangement, presented here for discussion is a summary of a current article from StorefrontBacktalk, a site tracking retail technology, e-commerce and mobile commerce.

When Target’s development team launched the new Target.com on August 23 after two years of development, it must have felt like a dream come true. But it wasn’t — at least not for customers who discovered that big chunks of the new site didn’t work at all, and almost nothing worked as well as the site they’d seen a day or two before.

Why? What went wrong? Actually, not much, from the point of view of experienced developers. Naturally the site had glitches — that’s to be expected.

Target decided to end its arrangement with Amazon two years ago — and that meant it had a completely blank slate to start from in creating a new site. Most e-commerce execs would love that opportunity to shed all the legacy code, the decade or so of kludges, workarounds and hacks that make it so difficult to do anything really innovative. All that old junk makes new approaches next to impossible.

But the downside is that there was also no legacy code that worked. If a new feature was too buggy, there was no old version to fall back on.

Target’s developers figured that was OK. The site would go live, they’d work the kinks out as quickly as possible, soon there would be all sorts of great new stuff built on the wonderful infrastructure that was still invisible on opening day, and everyone would understand — right?

No. Customers neither knew nor cared that the new website was the product of two years of loving development and was bound to have a few hiccups at first. It didn’t matter to them that Target had to build from scratch or that all sorts of wonderful new features would be coming once the site was stable.

All that customers saw was that their passwords, which worked fine on Monday, didn’t work on Tuesday. They couldn’t edit their wedding registry lists. They could no longer track orders they had paid for a day or two before. The weekly newspaper ad wasn’t showing up; neither were coupons. A large digital countdown clock on the homepage (an extremely long homepage) warned that today’s Daily Deals would end in so many hours, minutes and seconds — but the link went nowhere.

In fact, lots of the links were dead ends, delivering customers to very pretty error pages featuring Target’s mascot dog. (There’s a downside to using pictures of a dog mascot all over your site, including error pages: at a certain point, customers are likely to start really hating the sight of that little dog.)

No doubt all of that will soon be fixed. Much of the site was working far better the following day. But it will take a lot longer before customers feel like the new site is as good as the old one — which, of course, means better than the old one.

Discussion questions:  Do you think Target bungled its new website launch? What’s the best way to prepare and reassure customers for likely problems encountered as part of such overhauls?

My post:

Well it is now 11:30pm East Coast time and the site appears to be mostly working.  It was down when I first tried and then came up 10 minutes later with everything functioning except the “daily ad” link.

The comments above are accurate:

1.  “Glitches” are certainly failures, and

2.  The customer will not hold this against Target.

It is, however, a significant embarrassment to the IT team and should be a cause for concern for senior leadership.

Overall I like the design of the new site and think the situation will be forgotten by tomorrow – as long as it continues to function!

Mike Osorio, your Dare to be Contagious! ™ strategist

www.OsorioGroup.com

What do you think?  Please add your comments and add to the discussion!

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Go to the full discussion at Retailwire.com:  New Target.Com

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Fashion’s Night Out

September 14, 2011

DISCUSSION TOPIC

Fashion’s Night Out Draws Critics 09-12-2011

Marking its third year in the U.S. last Thursday, Fashion’s Night Out drew a horde of people, lots of media attention and not many shoppers. But was the spectacle enough?

Some think so.

“What I love is to see youngsters,” Dior CEO Sidney Toledano told Reuters in Paris. “All (these young people) will not become clients, but we need to seduce them today to have them tomorrow.”

Indeed, most stores reportedly broke even at best or more likely lost money for the night, paying for the booze, hors d’oeuvres, giveaways, DJ’s, models, musicians, celebrities and other entertainment. Some on the record said they believe that was enough if the one-night event celebrated fashion for existing customers and reached some old or potential new ones.

Australia Vogue’s editor-in-chief Kirstie Clements told The Australian that with the rise of online shopping, stores have to be more experiential. She said, “It’s really about sales, not celebrity.”

The fashion fiesta, spearheaded by Anna Wintour, Vogue’s worldwide editor-in-chief, has spread to 250 cities in the U.S., and 17 countries around the globe.

But Bud Konheim, CEO of Nicole Miller, lamented that no purchases were being made.

“FNO is a hype where anybody can go and get a free drink in any store in New York,” he told Women’s Wear Daily. “What does it do for business? Nothing. FNO doesn’t move the needle, but it adds to the perception that fashion is fun. We have to make people feel good or else we’re out of business. In terms of the money we spent on FNO, we didn’t get it back.”

A particularly vocal critic has been New York Times fashion critic Cathy Horyn, who in 2010 called for an end to the event. She wrote at the time, “What are you really celebrating? Not art or great books. You’re celebrating shopping.”

This year, she wrote that the event made sense in 2009 when traffic was sparse and small stores were closing, but “now it’s become a party, an institutionalized kickoff to Fashion Week, and though it apparently raises money for some causes, I have to believe that the costs of security, crowd control and entertainment, not to mention the traffic headaches, outweigh the actual benefits.”

She further noted that major stores are now thriving and “smart and fashionable, not safe” merchandise is drawing traffic to stores across the city. Concluded Ms. Horyn, “You really don’t need outside influences to shop these days.”

Discussion questions:  What is your assessment of Fashion’s Night Out? Would you advise retailers to participate? What would you do to improve it?

My post:

The critics need to chill.  This is like a Saturday downtown art walk or music festival.  Not meant for immediate sales, but rather to increase awareness and passion.  Fashion, my friends, is art.  The Vogue Fashion Night Out allows the industry to celebrate the art and fun that is fashion, as well as raise money and awareness for various supported causes.  The long-term viability of the fashion industry is helped by bringing in more aficionados and aspirational fashionistas.  Yes, many will just enjoy the giveaways but as Dior’s Toledano astutely declares, “All (these young people) will not become clients, but we need to seduce them today to have them tomorrow.”

Mike Osorio, your Dare to be Contagious! ™ strategist

www.OsorioGroup.com

What do you think?  Please add your comments and add to the discussion!

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Go to the full discussion at Retailwire.com:  Fashion’s Night Out Draws Critics

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Planet of the Apps

September 14, 2011

DISCUSSION TOPIC

The Rise of the Planet of the Apps 09-06-2011

Through a special arrangement, presented here for discussion is an excerpt from a current article from the Joel Rubinson on Marketing Research blog.

Four years from now, it is likely that globally there will be close to two billion (yes, billion) smart mobile devices, outselling computers, according to Yankee Group estimates.

Nielsen reports that over half of mobile phones being activated now in the U.S. are smartphones. IDC estimates 182 billion (yes, billion) annual app downloads by 2015.

Flurry estimates that smartphone owners spend more time on apps than PC owners spend on the internet from their computers.

Smartphones, tablets and the iPod Touch will create the mobile, app-enabled lifestyle. Why? Because mobile is not like a computer with a small screen; it is transformational. Apps provide needed simplicity for mobile web access by extracting the essence of a service and putting it right in front of the user in a way that fits perfectly within the screen limitations while adding a localized dimension.

If there is any life activity that is crying out to become appified, simplified, localized and mobilized on your smartphone, it is shopping. Furthermore, marketers want it too. Imagine you will be able to deliver messages and offers to a shopper as they stand right in front of your brand and its competitors that are customized from prior purchase activity. This is behavioral targeting and “recency,” two principles of media placement on steroids.

Look at this distribution of time spent on apps by category from Flurry; it appears that shopping aids have not yet taken off.

  • Games: 47 percent
  • Social: 32 percent
  • News: Nine percent
  • Entertainment: Seven percent
  • Other: Five percent

However, app developers are starting to work on this:

  • Modiv has been testing a mobile shopping solution called Scan It with Stop & Shop that is now about to be tested on iPhones. It links offers to your frequent shopper history and knows where you are in the store.
  • Ad Age reports Finish Line unveiled a new app that gives shoppers access to real-time inventory at the store nearest them. Users can check to see if an item is available in the style, size and color they’re looking for before coming to the store.
  • Amazon offers a price checking app so you can be in a Best Buy or Walmart, check the price of the same item at Amazon and decide if you want to order it from within the app.

Truly it is the “Rise of the Planet of the Apps.” As an increasing majority obtains smart mobility, as smartphones replace PCs as the number one way of accessing the internet, as life becomes app-enabled, people will insist, “Yeah, we want an app for that” — and they’ll get it.

Discussion questions:  How will the growing appeal of apps change the way brands and retailers connect with consumers? How will it change the way consumers interact with brands and retailers?

My post:

The biggest concern I have with app-driven shopping is the reliance on price to drive consumer behavior.  It is as though no one can learn the obvious:  using price as the single differentiator allows only one or two low-cost providers to survive the ensuing carnage.  In this model, Amazon and Wal-Mart will clearly prevail.  Anyone else?  Doubtful.  My hope is for the brands to drive unique app offerings that focus on experience over price.  However, except in the rarified world of luxury products and consumers, it is increasingly difficult to capture the consumer’s attention with anything other than price, and perhaps celebrity.

A reason for hope?  With the increase in influential bloggers, I can foresee a success formula that utilizes targeted ‘endorsements’ to drive consumers to shop at regular price for their favorite influencer’s recommendations.  This works particularly well in the beauty industry.  Let’s see who makes this move vs. the damaging price-only model.

Mike Osorio, your Dare to be Contagious! ™ strategist

www.OsorioGroup.com

What do you think?  Please add your comments and add to the discussion!

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Go to the full discussion at Retailwire.com:  The Rise of the Planet of the Apps

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The rise of “virtual mirrors” creates a new way for brands and retailers to engage with consumers

August 9, 2011

DISCUSSION TOPIC

Looking and Buying Without Touching 08-08-2011

By Bernice Hurst, Contributing Editor, RetailWire

August 8, 2011

At first glance, a story about John Lewis introducing virtual mirrors devised by Cisco so customers don’t have to strip off to see how a new outfit looks seemed like new news. But a quick Google search revealed others have been following a similar path since 2007.

John Lewis believes customers trying multiple fashion lines along with accessories will facilitate cross-selling and mutual retailer and customer satisfaction.

When Adidas introduced similar technology to their Paris store in 2007, Louis Ramirez pointed out a fallacy on gizmodo.com. “I think the concept is cool,” he wrote, “but I’d be more concerned over the fit than how they look.”

Cisco’s mirror uses sensors to measure customers and then find suitable outfits. Their spokesman told Retail Gazette, “The technology takes the drudgery out of searching for items and exposes people to a wider range of clothing. It will be more efficient and provide the retailer with the chance to cross-sell brands and accessories, while at the same time improving levels of service.”

Ways to incorporate social media are also being studied so customers can share their images with friends once privacy issues are resolved.

Meanwhile, webcams are the mirror of choice for glasses. La Boutique Peugeot uses customers’ webcams like a mirror before purchasing in-store. Ray-Ban boasts its virtual mirror is “the definitive augmented reality experience, which permits you to virtually try-on the latest Ray-Ban styles.” Sunglass Hut uses digital photo booths in some stores so customers can immediately send pictures to friends or social networking sites for other opinions on their choice. UK-based glasses2you, promises a wider range of glasses at a lower price than specialist opticians.

Various approaches to virtually applying cosmetics have also been tested by the likes of Walmart, Carrefour and Superdrug amongst others. IBM and Israel’s Ezface use an “augmented reality system” to combine video images with virtual/digital elements on the same screen, according to singularityhub.com, but the complexities of accommodating individual skin tones, lighting, hair color, etc. may explain why neither kiosks or sales have yet made headlines.

Discussion questions:  How appealing will virtual mirrors be for customers trying on clothes? Are virtual mirrors rendered impractical by the inability to test the way products fit and feel?

My post:

The point here is not about efficiency, it is about fun.  Retailers and brands who choose to use the technology should do so as a carefully considered addition to their consumer touchpoints.  If done well, the technology allows the consumer to play with the product, share their experience with friends and ultimately engage them with the product in a (hopefully) positive way.

The technology does not replace the physical shopping experience.  Rather, it provides a further pull for the customer who wants to play with the product in real terms to come into the store.  For those who are shopping online with no intent to go into the store, it can make that experience more engaging as well and produce higher conversion and spending rates.

  1. Do your research with your targeted consumer groups to ensure playful engagement is a desired experience.
  2. Test the technology and roll out if the desired metrics are achieved:  conversion, spend, or simply higher client engagement.

Mike Osorio, your Dare to be Contagious! ™ strategist

www.OsorioGroup.com

What do you think?  Please add your comments and add to the discussion!

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Go to the full discussion at Retailwire.com:  Looking and Buying Without Touching

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Tesco S Korean Subway Virtual Store

July 6, 2011

DISCUSSION TOPIC

Tesco Takes Virtual Store to Subway Riders in South Korea 07/06/2011

TOPIC SUMMARY:

Tesco was looking for answers in South Korea. According to a video from the company (be sure to watch it), its Home Plus chain was second largest in the market and investigating ways to gain share without adding physical stores. Management reasoned that hard working South Koreans needed something that would make their lives easier.

The answer that Home Plus came up with was to take the store, a virtual one at that, to consumers inside a subway station.

The virtual location is laid out exactly the way a typical Home Plus store would be. The company has created photo layouts of products it sells with a unique code for each product. Consumers scan the QR codes for the items they wish to purchase and then check out. Orders are automatically delivered to the consumer by the end of the day.

According to the chain’s video, the virtual store has brought it thousands of new customers and its online sales in South Korea have increased by 130 percent.

Home Plus’ virtual store is just one of many innovations likely to come to retailing with the development of mobile technologies.

Discussion questions:  What do you think of the Home Plus virtual store? Does it have applications in the U.S. market?

My post:

Tesco has often created innovative shopping solutions and this is simply their latest.  They have focused on the specific shopping needs and behaviors of the South Korean consumer and designed a unique method to combine two activities, commuting on the subway and shopping for that day’s grocery needs, into one.  The whole allure of mobile platforms i.e. tablets and smart phones, is the potential for allowing people to shop wherever they are.  The virtual subway store enables people to shop the way they like – either independently on their device at the on-line store, or “roaming the aisles” via the virtual store.  Based on the stated results, the consumer is reacting well.  Over time, this method may lose it’s novelty but it is a brilliant way to entice more consumers to try the online store.

Would it work in the U.S.?  Probably not in the same way.  The subway experience in the U.S. is far different than in Asia.  In addition, home delivered online grocery shopping is not well penetrated in the U.S. as compared to South Korea.  However, the point here is for the retailer to consider placing the virtual store in an area where the consumer would enjoy shopping.  Where might that be in a U.S. metro market?  I am not sure – but I would not dismiss the possibility.  Grand Central Station?  A section of wall in a large office tower?  Interesting to imagine.

Mike Osorio, your Dare to be Contagious! ™ strategist

www.OsorioGroup.com

What do you think?  Please add your comments and add to the discussion!

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Go to the full article at Retailwire.com:  Tesco S Korean Subway Virtual Store

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New Target program guarantees unbeatable prices

May 12, 2009

DISCUSSION TOPIC

Target Revives Dropped Price-Matching Program 5/12/09

TOPIC SUMMARY:

Target dropped its price-matching program in 2002. That, as they say, was then because now it looks as though the retailer may be on the verge of bringing it back. Target has tested the program in two markets since March 15 and began a third in its own Minneapolis backyard on May 1.

The retailer has been matching lower prices in its competitors’ ads at 22 stores in the Orlando area and 28 others in Denver for the past two months. The chain rolled out its “Unbeatable Prices. Guaranteed.” program in Minneapolis and Medina earlier this month with the expectation that it will result in a national expansion of the price-matching initiative.

Target believes it has figured out a way to get around the problems it found in 2002. Then, competitor prices were verified at the checkout, causing delays at the front-end. Now, all pricing will be verified away from the checkout at the store’s service desk.

Delia McLinden, a spokesperson for Target, told the Minneapolis Star Tribune that the program was being retested because they “want to speak boldly about value and low prices and give customers peace of mind.”

The Minneapolis/St. Paul Business Journal pointed out in an article that “Target has been ratcheting up its emphasis on prices for the past year, as consumers cut back on discretionary purchases during the recession.”

Discussion questions:  How much will Target’s “Unbeatable Prices. Guaranteed.” program help it achieve a stronger price image with consumers? Does a program like this risk diluting the equity Target has built for its brand over the years?

My post: 

I have always been a big fan of Target.  I am “one of those” who avoid Wal-mart if at all possible due to the feel of the place.  Target provides good prices (even if not as low as Wal-mart) with nice ambience and some really cool product via their focus on design.  Unfortunately, they have drifted in the last few years and lost some of their message.  It didn’t change my enjoyment of the shopping experience there but clearly Wal-mart gained share as they stayed true to their low price message and dealt with much of their bad publicity.

I haven’t seen the new price-matching program in action, but I will assume the two test markets have shown strong results or they wouldn’t be expanding the program.  Target is known for execution, so I will assume they have the bugs worked out of dealing with the customer requests.  I think the marketing message is right for the times and as long as they keep to their design ethos, it will prove to be a good move.

Mike Osorio, your Dare to be Contagious! ™ strategist

www.OsorioGroup.com

What do you think?  Please add your comments and add to the discussion!

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13736

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Lose your job, your suit is free!

March 17, 2009

DISCUSSION TOPIC

JoS. A. Bank Free Suit Offer Made for Tough Times 3/17/09

TOPIC SUMMARY:

JoS. A. Bank has the promotion for you if you’re among those trying to put your best look forward at work or if you’re interviewing for a new job. The company’s new “$199 Sale” comes with a unique guarantee. If you buy a suit from the retailer and subsequently lose your job, the chain will refund your purchase price and let you keep the suit on top of it.  Details here.

R. Neal Black, CEO of the men’s clothing retailer, said in a press release, “We understand the uncertainty everyone is facing. We want to help the customer look good at work, and if he loses his job, to be dressed appropriately as he meets with his next employer. It’s like giving all of our customers a bit of unemployment insurance.”

The special promotion applies to any suit or suit jacket/pants combination purchased from March 16 through April 9, 2009. If the customer involuntarily loses his job between April 16 and July 1, JoS. A. Bank will refund the price paid for the suit, up to a maximum of $199. The company will require documentation of a job loss to evaluate any refund requests.

Discussion questions:  What do you think of JoS. A. Bank’s “unemployment insurance” offer? Will it drive additional sales? Will we see others following this example during the downturn?

My post: 

I have known CEO Neil Black for years and I am not surprised to see him once again knowing how to effectively speak to his customer base.  Yes, the promotion is a bit silly, and borrows from other’s ideas (Hyundai, etc.).  But it nails the current market psychology and press sound bites:  the economy sucks, people are losing their jobs left and right, people are scared, etc. etc.  The promotion shows that they get it, they are listening, and they are positioned as a value retailer to be helpful for a product that the consumer needs but may be scared to spend on.  At a time when most retail stocks are in terrible shape, JoS. A. Bank (JOSB) is performing well over their peers and is up 8% YTD.  Mr. Black, keep the promos coming!

Mike Osorio, your Dare to be Contagious! TM strategist

www.OsorioGroup.com

What do you think?  Please add your comments and add to the discussion!

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13616

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