Archive for November, 2008

NMB’s Rules of Pre-Holiday Retail: “Don’t let the promise of short-term volume compromise long-term brand equity”

Posted in Blogroll on November 30, 2008 by nmb

This past week, our firm walked the high-end boutiques along Melrose Avenue and Robertson Blvd in Los Angeles. In store after store, we were greeted immediately with “Everything in the store is an additional 40% off” and whispers of “Everything in this room is 70% off.” I don’t know about you, but I wouldn’t pay full price for Alexander McQueen ever again after seeing such drastic slashes. The discounts also had the effect of cheapening others’ brand premises along the block. A more moderate rocker-brand boutique down the street was full-on full price . . . nothing was marked down.  That left me a bit indignant . . . who are they to stay at full price on their $140.00 screened t-shirts when “real” designers are getting drastic?  Like the old Saturday Night sketch:  “The ones who ruined it for everyone.”  Where did we stick around for a while? The completely full price Chanel boutique . . . Order was restored!


NMB Rules of Pre-Holiday Retail: Help Black Friday Beat the Blues!

Posted in Blogroll on November 30, 2008 by nmb

More markdown rants . . .

As we do every year, nmb hit the streets pre-dawn on Friday to get a bead on the 2008 holiday shopping zeitgeist.  Last year, it was all about destination shopping; mapping out a specific plan, circular in hand, in order to snag specific items at guaranteed savings while quantities lasted.  Last year’s post-Black-Friday headlines debated the fairness of advertising items that were intentionally limited in supply and documented how rapidly that supply depleted as the sun rose.   You also had your token trampling and tales of shootings that turned out not to be about shopping at all (as though that made it all better) . . . some things never change.  However, much has changed in the motivation department this year.  Seems that folks got up at 4:00 in the morning, jumped in their cars and hit multiple retailers in quick succession . . . just for the fun of it?  Yep, that’s right . . . as Ryan put it “My wife, my brother and his wife . . . we just thought it’d be fun to watch everyone.”  They hit Wal-Mart, Home Depot, Best Buy and Bed Bath & Beyond in rapid succession and made it home with their bootie:  A plastic garland and a mini Christmas tree.  According to Ryan “We weren’t going to buy anything but my wife couldn’t resist.”  Total sale:  $15.75.  Or how about Christine . . . She and her gal pal, Laura have never hit Black Friday before so why now?  “Well, I guess it sounds kinda dumb, but we just thought it’d be fun . . . to kind of get our minds off things before the holidays hit.”  Total purchases?  $0   John?  “I don’t really know why I went out . . . just something to do I guess.  I’m still not sure if the prices are really that much better.”

Times are so tough that shopping is a diversionary spectator sport  . . .  restraint vs. impulse is hardly an issue . . . “conversion” isn’t a possibility . . . traffic is just, well, traffic.


My prediction?  Things are not going to go back to “the way they were” and when “everything picks back up again.”  Retailers need to get it that price is not the magical motivator and that in fact, the more that prices are slashed, the more jaded consumers become . . . Beyond that, shopping is not the same as buying.  One can be a passive activity; the other requires active engagement and intention.  Retailers have a real opportunity to make shopping more entertaining; to give a bit more before expecting to get; to elevate the conversation beyond price.  After all, consumers already have.

Wal-Mart’s John Andrews’ Expanding Retail Media Universe

Posted in Blogroll on November 13, 2008 by nmb

It’s way too early for anyone to claim omniscience in the world of emerging media and particularly its implications for retail.  What better way, then, to wrap up the Bentonville Chamber’s ( Wal-Mart executive presentation series than to host Wal-Mart’s Senior Marketing Manager of Emerging Media, John Andrews . . . He brought the same upbeat, self-effacing candor to this topic as he did last November when PRISM (Pioneering Research for an In-Store Metric) was all the rage and when clean aisle policies were keeping everyone awake at night.  (Wal-Mart’s Smart Network was probably an incubating embryo back then.)  Good for Wal-Mart for getting the gravity of the emerging media challenge by making it Mr. Andrews’ full time pursuit, rather that one of those “We’re taking this onto your DAY job” things.  Let Wal-Mart’s competitors continue to call out “Prove it!” and “Where’s the ROI?” . . . Wal-Mart’s jumpin’ in to this complex world of connections head (and heart) first.  Isn’t it nice to know that not everything in retail is shrinking!


It’s not easy addressing Wal-Mart’s take on the convergence of internet, mobile platforms and in-store communication in less than an hour . . . unless you refuse to bore the audience with eye chart slides, techno-babble and geek-speak.  (Thanks for keeping it real, Mr. Andrews!)


Throughout the presentation, the phrase “Do it first and fix it later” kept ringing in my ears . . .  I’m not quoting John Andrews but, rather, Natalie Massenet, the founder and chairman of  I heard her speak a couple of weeks ago at a ceo summit put on by Women’s Wear Daily and I realized that Wal-Mart has some very important things in common with the uber high-end apparel etailer:  They both believe  that waiting for perfection means sacrificing first-mover advantage . . . actually these days, it means sacrificing relevance . . . much too high a price.  She too took on what would seem to be an ill-advised venture (selling designer apparel . . . at full price . . . online!) and with seemingly horrible timing (Dot com burst).  Mr. Andrews is overseeing Wal-Mart’s biggest explosion of emerging media, something that many of its competitors haven’t even winked at, right smack in the middle of a recession.  Breaking the hunker-down mold, Mr. Andrew’s talk took on a tone of discovery, listening and of embracing imperfection and iterative refinement processes.  Other recent Wal-Mart executive presentations have had this same vibe . . . very nimble and course-correcting.  Leaves me wondering why others with far less at stake continue down the control and command path!


The first slide reminded us  that Sam wasn’t stodgy (“We didn’t have to change who we were . . . our purpose aligned with Sam Walton’s vision”) and that all initiatives are in complete alignment with Wal-Mart’s stickier-by-the-day mantra of “Save money, live better.”  Make no mistake, complex technology is in no way at odds with straightforward messaging to the consumer and returning to that one message has allowed Wal-Mart to maintain its focus while taking on a dizzying array of media plays.


In lock step with a recent presentation given here by Wal-Mart’s three tenors, Bill Simon, Stephen Quinn and John Fleming (see previous posts),  Mr. Andrews confirmed that, until further notice, all of Wal-Mart’s emerging media efforts are laser-focused on “mom” (also the acronym for Merchandising, Operations and Marketing in case you needed another association).  In the previous presentation, Stephen Quinn did a great job of explaining why Wal-Mart doesn’t have a problem obsessing on this one customer before straying.  Until she’s delighted, why move on?  And, you don’t sacrifice much business when that one group makes most of the in-store decisions from apparel purchases to the automotive services at Tire and Lube Express  . . . Oh, and she also happens to be the fastest growing user in the social media space, a space where she can meet new people and connect to people she cares about . . . and sure, probably some she doesn’t.  Wal-Mart is doing everything it can to stay out of the latter category by focusing relentlessly on what mom wants, and by getting the 411 directly from the source rather than making wishful, stretchy assumptions about her that discourage her ongoing opt in.


Wal-Mart knows one thing about mom:  she wants to save money, and she wants to do it her way . . . She might be a “couponista” or she may like getting price alerts on her iPhone . . . Maybe she’s a “lurker” (or Mr. Andrews’ refinement, an “observer”) who likes to watch and read others’ content . . . or maybe she resides in that 8-10% who actually like creating content themselves (guilty as charged).  Wherever and however mom wants to interact with Wal-Mart is fine with Wal-Mart if it increases loyalty and helps the retailer gain new insights. 


Wal-Mart’s also cool with not controlling the conversation . . .

Maybe control would be possible if their view of extended customer connection points stopped at “clicks” . . . It doesn’t.  Wal-Mart’s world of “connect and share” is far vaster and uncontrollably chatty.  If Wal-Mart has managed to stay perfectly on-message even as it brings all of this complexity into the mix, the retailer has no expectation that its customers will. 


In the online world, that means incorporating polls, ratings and reviews (over 1,600 ratings are posted each day on, live chat, feedback buttons, discussion boards, Q&A (turns out lots of the people asking questions are store associates), and blogs . . . including engaging outside bloggers and providing connections to them (more on that later).  In-store, it looks like Wal-Mart’s revolutionary Smart Network, a system so paradigm-changing that it warranted its own one hour review.  On the go, we’re talking mobile, including Wal-Mart’s recently-announced iPhone-optimized webapp which can attach to anything that has a data platform.  The “endless aisle” will soon be in the palm of your hand and, if you want the latest in bargains in the meantime, just give out your phone number on to have rollback notifications and other budget-friendly headlines pushed to your device.


Smelling the future, and in keeping with our “Always right, sometimes early” blogging premise, we hooked up with power blogger, Camille Padilla (, one of Wal-Mart’s “elevenmoms,” a couple of months ago (we covered this in our monthly retail e-newsletter:  Smashbook.  Send an email to me at if you want a copy).  This was back when the “elevenmoms” were actually twelve, and now there are upwards of twenty mom bloggers going strong under Mr. Andrew’s keep-it-real, hands-off nurturing.  Call him an enabler but don’t accuse him of swaying these clicking chicks.  My conversations with Ms. Padilla confirmed that Wal-Mart has not compensated the moms and that meticulous boundaries have been maintained around where Wal-Mart stops and they start.  Wal-Mart wants the moms to do what they do best:  blog, and in some cases post videos, about money-saving ideas from a mom-friendly perspective.  The moms have posted over 100 videos through the elevenmoms effort (Check out the videos at, and with You Tube quietly becoming the #2 most visited website, that’s a ton of mom-reach.  Want more proof that Wal-Mart is keeping its mitts out of the content?  One blogging mom is known for her prowess at ferreting out bargains . . . at drug chain CVS!  No worries; it’s all good says Wal-Mart.  All of this in an effort to move away from “transactional” relationships to ones that are “more engaged” and “deeper”. . . and I’ll throw in the retail word of the year, “authentic.”  And consumers aren’t the only ones doing the learning.  Wal-Mart flew the elevenmoms into Bentonville not too long ago and gave Eduardo Castro Wright and other top Wal-Mart brass an audience with them.  According to Mr. Andrews, the moms weren’t the ones with sweaty palms, and the insights gained reinforced many of the retailer’s  goals for, and concerns about, moms’ perceptions of the Wal-Mart experience.  Bottom line:  Wal-Mart is listening, not dicating.


With nine out of ten Americans shopping at Wal-Mart and 22% knowing someone who works at Wal-Mart or Sam’s Club (here in Bentonville, I think that stat is roughly 100%), even a wee bit of outreach adds up big time.  Every Wal-Mart presentation has to have a few astounding facts . . . What has an audience greater than the Superbowl or the Emmys and Oscars combined?  Well, we know it’s not NBC, right?  It’s your average Wal-Mart store’s weekly throng.  No wonder one Wal-Mart sounded positively modest when he announced that Wal-Mart’s in-store network (Smart Network) will become the #1 network of ANY kind in short order.  Sounds reasonable to me . . . In this world of media fragmentation, a Wal-Mart store is the definition of “captive audience” and this “shopper centric communications platform” will serve as a “dynamic and intelligent learning network” that will connect that audience with products at the point of sale.  Each screen will be aligned with how the customer shops the store and programming will be based on customer mindsets and habits (dovetails with all the talk about “need states,” “life stages,” “missions,” and “occasions” that you’re hearing at the home office).  The Smart Network is just there to help its massive audience learn more, when and how it wants to, and to take that connect and share idea from the Internet to the shelf.  Wal-Mart and its vendors get bennies in the form of “consistent and insightful” sales analysis.  Time to brush up on your terminology or risk joining the ranks of the clueless:   “channel”  isn’t necessarily about how or where someone shops;  “frequency” doesn’t necessarily refer to how often; “networks” may or may not be your friends or on your television, and “screenings” may or may not be happening at the theater or airport!


Q&A revealed that Wal-Mart absolutely sees its Smart Network as an education platform, particularly as relates to new product information, and the content will continue to evolve to meet specific needs as insights are gained.


When asked what the next generation of the Smart Network looks like, in an acknowledgement to the possibilities, Mr. Andrews quickly answered “I don’t know.”  He went on to clarify that the goal will be to have everything connect to the Smart Network and to continue to offer ways for customers to opt in.  Say, having a notice pop up when you hit the Wal-Mart parking lot, reminding you to refill that prescription and get that oil change.  When you venture into “proximity” marketing, you’re entering a whole new universe of possibilities . . . one that has Mr. Andrews paling around with twenty-somethings like the dude who started, a vaguely twitter-ish “location-based social network” (


Don’t you just love a guy who’s not afraid to ask for directions? This is not a job for somber know-it-alls . . . and Mr. Andrew’s enthusiasm, outward focus and desire for input hasn’t waned one bit.  Clearly, reducing Wal-Mart’s current successes and post-recession prospects down to price advantage alone is simplistic when Wal-Mart is connecting the dots in ways that will forever change the relationship between retailer and consumer … and doing so at a time when others are mightily distracted.

Hey Fat Head! In-Store Marketing Metric Madness

Posted in Blogroll on November 5, 2008 by nmb

The battle to quantify the impact of in-store media rages on and now some folks are introducing “big head”/“long tail” dynamics to the discussion.  The reasoning goes that certain in-store media, everything from end caps to a shelf talkers are in shoppers’ fields of vision much more often/longer (big head) than others (long tail) and that brands/vendors should pay for exposure accordingly.


Various technologies have been, and will continue to be, developed that claim to measure the “impact” of in-store media . . . the only problem is, measuring visual exposure is not the same as measuring impact.  I can see something over and over . . . say, a political ad for a politician who doesn’t have my vote, and the fact that I’m seeing his ad more often does not change my already-established preference . . . in fact, it might reinforce my choice (timely example, no?)


There’s a real need for context when weighing long tail vs. short tail metrics. A closer look at long tail movie renters (those who routinely rent off-beat/niche movies), for example, revealed that they just have bigger appetites. Far from avoiding blockbusters, it turns out that they had rented all they could from the “big head” and were forced into the long tail through their heavy consumption!   

Back to the store…there is a reason why retailers are talking more about consumer “missions,” “life stages,” and “need states” these days; they’ve figured out that the context that consumers are placing around their shopping trip, the “why” vs. the “what,” makes all the difference. Sigh . . . it also continues to make the in-store marketing ROI equation more complex than comfortable.