Thursday, February 28, 2013

Accessorize for the Downsize

Spotting trends within trends improves your retail profits. Understanding the shopper psychology rationale for trends within trends gives a bonus lift.
     A current example of this? Although fashion clothing and shoe sizes are trending larger, fashion accessories are trending smaller. Market information firm The NPD Group reports that large handbags—15 to 18 inches tall or wide—were highly popular before the Great Recession, but now account for only about 26% of dollar sales. Pulling ahead have been the midsize handbags—at least 12, but less than 15 inches tall or wide—which now account for 43% of dollar sales. The figure is 7% for the Supersize Me handbags exceeding 18 inches in height or width.
     NPD says sales of other fashion accessories are showing a similar profile of the move toward the middle. It’s an exception to what I call “barbell retailing”—a pull away from middle markets and toward the low and the high.
     The shopper psychology rationale for the larger clothing and shoe sizes is physical comfort. People are getting bigger. The rationale for the handbag trend consists of a move away from showiness in fashion.
     Another trend within a trend is “vanity sizing.” Although the clothes are getting larger, the label designations aren’t. For a while now, fashion retailers have been intentionally mislabeling the sizes on clothing so that shoppers think they can fit into a size 10 when a standard measurement chart would tag the item as a size 12. The phenomenon is seen most often with women’s clothing, but a number of British retailers are also using “manity sizing,” labeling trousers as a smaller size than they really are. Debenhams, Next, and Topman were selling pants up to one inch larger than labeled. The objective is to have customers say, “I feel better about myself when shopping at that store rather than elsewhere, so I’ll make more of my purchases there.”
     Research at University of North Texas found that:
  • Expensive clothing has been more likely to use vanity sizing. Ralph Lauren and Calvin Klein clothing items were especially tolerant of size label distortions. 
  • Consumers 20 to 29 years of age were more pleased with vanity sizing than were consumers 40 to 49 years of age. As a trend within a trend within a trend, older shoppers want more accurate sizing information. Macy’s and Lane Bryant have been posting the real size information online. 
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Wednesday, February 27, 2013

Extend Cautiously When Shelf Space Is Limited

In the early 1980’s, the United States Postal Service—the only retailer specifically mentioned in our Constitution—stopped directly receiving taxpayer dollars and was expected by Congress to become self-sufficient. During this USPS transition, I was doing training with USPS managers in Washington, DC.
     Along with other elements in my SWOT (strengths, weaknesses, opportunities, threats) needs assessment, I discussed the use of “electronic mail,” which was at the start of chipping away at postal mail usage. After this training day, two of the managers came up to me to voice an objection. They said that the word “mail” rightfully belonged to the USPS. They asked me to consider using the term “electronic transmission” in my seminars to refer to what’s now known as email as well as to fax, which was already at this time a clear and present danger to the fortunes of postal mail.
     The dance between the USPS and digital technology continues. In a press release last week, the agency announced they’re launching apparel and accessory product lines under the brand name Rain Heat & Snow. This name was inspired by the Postal Service’s unofficial motto, “Neither snow nor rain nor heat nor gloom of night stay these couriers from the swift completion of their appointed rounds.” The press release didn’t mention anything about stopping Saturday deliveries, though.
     Where’s the digital technology angle? Well, the clothing, to be manufactured by Cleveland-based Wahconah Group, is to come with wiring so the wearer can plug in their electronics.
     Wahconah wants to place the merchandise in department and specialty stores. NPR says Nordstrom is a possibility. Would you carry these items, or the USPS-branded mugs and neckties the agency brought out in the 1980’s?
     When deciding whether to include such brand names in your store’s limited shelf space, you’re walking into the well-worn consumer psychology research area of brand extensions. A general finding is that the extension should fit with the image of the brand personality. Nike probably would do better with treadmills than with cosmetics.
     In their look at the issue of poor fit, researchers at Rutgers University, California State University-Long Beach, and Ohio State University uncovered the existence of Kodak pianos and Buick aspirin as misappropriated brand names. At the other extreme, flashlight and battery maker Dorcy is using the Diehard name, licensed from Sears Holdings, which had built strong associations between the name and car batteries.

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Tuesday, February 26, 2013

Ask Shoppers Why They Like or Dislike Items

When a shopper tells you they liked or disliked an item they’ve tried out, it’s useful to know why. But realize there are shopper psychology considerations.
  • Avoid the word “Why?” Shoppers often interpret that question to mean you’re challenging the wisdom of their decision. It also challenges the power balance. Shoppers prefer to believe they have more authority than the retailer in the transaction. Use softer phrasing like, “I’m interested in hearing more about what you liked with the item,” or “I’d be grateful if you told me more about what you disliked.” 
  • Researchers at University of Alberta find that if the item you’re asking about is one the shopper is evaluating to give pleasure—like a cupcake—having the shopper list the reasons dampens the intensity of the reaction. If the shopper liked the item lots, asking for the explanation makes them like it a bit less. If the shopper truly disliked the item, the recitation of reasons results in the shopper disliking it less. Emotions are experienced holistically. Asking somebody to dissect an emotional reaction decreases the power of the emotion. Two hints for retailers: First, if a customer is expressing ecstasy about a pleasure-oriented product you’ve sold them, don’t ask too many questions. Second, if a customer is expressing intense dislike, ask them to tell you the reasons and listen carefully. But don’t have the customer go on for too long. Findings from research at University of Maryland and Yale University indicate that too much talking will lock into the shopper's mind the bad feelings they're experiencing, and those negative memories make it less likely they'll buy from you in the future. 
  • The Alberta researchers found that if the item is primarily utilitarian—such as a bathroom cleanser—the effects of explanation are the opposite of those for a hedonic item. When the shopper explains why they like the item, they come to like it even more. After having explained why they dislike it, they’ll dislike it even more. With those negatively-evaluated items, some things are best left unsaid, at least from the retailer’s perspective. But there’s also a caution on the liking side. Researchers at New York University found that it if we ask somebody to dig for reasons they liked an item, they’ll run out of things to say and interpret the difficulty to mean, “I guess the item isn’t so great after all.” 
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Monday, February 25, 2013

Unpack Unpleasant Experience Time Estimates

Sometimes what the consumer buys includes a sequence of unpleasant experiences. The retailer isn’t selling the unpleasantness, but it’s inevitable in order to accomplish the positives.
  • A carpet store requires the purchaser to prepare for the installation by moving items and then, after installation, moving items back into place. 
  • In applying for membership to a prestigious country club, the prospect must not only gather the funds for the dues, but also complete forms and coax references. 
  • To undergo a medical procedure, the patient might need to carry out a set of steps both before the procedure and afterwards. 
     To be sure all the steps are completed properly, the retailer would do well to compile and present a list. However, researchers at University of Toronto find, not surprisingly, that when consumers read such a list, it increases their estimates of how bad the total experience will be. It gets worse yet if the shopper starts thinking about the amount of time all this unpleasantness will last or if the retailer tells them the total expected duration. Being told how long a bad experience will last makes it seem less tolerable, according to the Toronto studies.
     The researchers went on, though, to suggest a way to ease the agony a bit: Encourage the consumer to unpack the time estimates, guessing on their own how long each step will take rather than accept a time for the total given by somebody else.
     The reason this works is that we don’t like to spend time on unpleasant tasks, so we tend to predict we’ll get them done quickly. It works the other way around for a list of experiences a consumer finds pleasant. Here, when the time estimates are unpacked, the total predicted duration grows. We think it will take longer.
     To use the unpacking to best advantage, recognize that for many purchased items, there’s a mix of the pleasant and the unpleasant. The steps necessary to leave on a family ocean cruise might be a bother, but the steps necessary to participate in the cruise itself might be joyful.
     Also recognize that possessing an itemized list of negative tasks or experiences can itself give comfort. The list makes clear that there are limits. It won’t be infinite agony. A related point is that reading through and thinking about the list allows the consumer to plan ahead and prepare themselves for what’s coming.

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Sunday, February 24, 2013

To Build Loyalty, Ask Advice, Not Expectations

Before soliciting shoppers for input about your business, decide on objectives. Do you want to build a business intimacy between your current way of doing business and your shoppers or do you want to gather ideas for improving the way you’re currently doing business?
     If it’s more important to build business intimacy, researchers at University of California-San Diego and Northwestern University suggest you ask for advice rather than opinions or expectations.
  • Advice questions are of the form, “What items of advice do you have for our store?” 
  • Opinion items are of the form, “What are your opinions about our store?” 
  • Expectations questions are of the form, “What are your expectations of our store?” 
     Of the three types, advice questions were the most likely to lead to purchase intentions. In further analyses, the researchers discovered this was because asking for advice gives rise in the consumer to feelings of closeness to the store and a readiness to experience happiness if the store succeeds. In contrast, the expectations questions distanced the consumer from interest in the fortunes of the store except as a place to satisfy the consumer’s self-interested desires.
     These San Diego/Northwestern research findings also suggest that offering modest compensation for the advice is okay, but offering substantial compensation erases the feelings of closeness and therefore the heightened purchase intentions. It turns the surveying away from being a person-to-person call for assistance and toward this being an exclusively economic transaction devoid of intimacy.
     The broad spectrum of opinion items on surveys and the specifics obtained with expectations items can be useful if you’re probing for ways to improve how you’re currently doing business. A review of studies by business professors at Dartmouth College and University of California-Riverside found that when you’re seeking new business concepts rather than identifying new customer segments for the current model, it’s stimulating to seek survey respondents having certain characteristics:
  • Show optimism and determination 
  • Evidence more interest in the future than the past 
  • Use blends of words, drawings, and demonstrations to describe fully-formed ideas 
  • Discuss implementation details in terms of how things will end up more than in terms of where the business environment is now 
  • Will spot and then give up on impractical details of their own ideas, even if the basic thrust of their ideas tends to stay the same as what they began with 
  • Have no hesitation to take or adapt others’ ideas 
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Saturday, February 23, 2013

Show How Your Freebies Go to the Deserving

The Academy Awards ceremony is tomorrow, and the preparations have been underway for a while. Counting the votes, polishing the Oscar statuettes, giving away loot to celebrities.
     Regarding this last one, the Wall Street Journal reports that “gifting suites” in luxury hotels around Hollywood are open for business. The business of these platinum-grade pop-up stores is to offer to the stars lots of exclusive jewelry, designer fashions, precious skin-care potions, $3,000 Polaris bicycles, and close-to-release digital gadgets. The objective of the proprietors is to capture, for use in ad campaigns, photographs of the celebrities posing with the items.
     Not all the stars targeted for gifts flow in with wide open arms. The WSJ article quotes a publicist as warning her clients about how consumers can envy a celebrity whom the consumers believe doesn’t deserve to get something for nothing.
     The same sort of warning applies to retailers selling the products which would be in the photos. According to research findings from Tilburg University in the Netherlands, when a shopper believes another person earned the right to the advantages of owning a product, that shopper is willing to pay a premium for owning the product themselves. The extra money is like a tribute to the respected person. In the research, people who had this benign envy of someone owning an iPhone, for instance, were willing to pay an average of €80 extra for their own iPhone.
     However, if the shopper believes the other person doesn’t deserve the good fortune, a desire arises to show that what the other person has isn’t so great, after all. In the research study, people with this malicious envy were also willing to spend more money. But on a competing product.
     This ricochet reaction is related to schadenfreude, which means delighting in the misery of others. The word made it into an episode of  “The Simpsons” where Ned’s business is failing. Homer’s overjoyed. When Lisa defines schadenfreude, Homer replies, “Those Germans have a word for everything.”
     Psychologists at University of Kentucky conclude that schadenfreude comes from envy. We resent that the undeserving star has gotten a freebie, so we devalue the item by seeking something else instead.
     The celebrities’ way to handle this is to take items, then publically donate them. Your way of navigating through the different types of envy should be to show how any items you give away go to the deserving.

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Friday, February 22, 2013

Sidestep Complaint Extortion

There are customers who make unreasonable demands under threat that unresolved complaints, justified or not, will go viral on internet social networking sites or even result in lawsuits. Researchers at North Dakota State University started their analysis of this reality by noting how a Washington, DC man sued for $54 million when a locally-owned retail shop lost a pair of pants the man had brought in for dry cleaning.
     Prior studies identified steps you can take to minimize the probability of unreasonable demands:
  • Aim for fairness of outcomes. Ask the complainer, “What do you suggest I do to make things right?” Then see how close you can come to delivering. When you redirect the conversation from argument to teamwork, the request for corrective action can be both feasible and equitable. 
  • Institute fair procedures. Establish complaint-handling policies consistent with the personality you want your store to project. Use those policies to generate procedures which are easily understood by your staff. Then train your staff to follow the procedures and promptly deliver compensation for retailer errors. Include in your performance evaluation of each employee how well they handle customer complaints. 
  • Ensure fairness of interpersonal interactions. Treat each shopper in your store with respect, concern, and empathy. 
     But beyond the probability of unreasonable demands, what about the size? If you can erase the outrage with an action that’s not too costly, it’s better to keep the customer than to keep to a policy.
     With this in mind, let’s look at what the North Dakota researchers found out about complaining customers who make especially expensive unreasonable demands: They have a combination of two characteristics:
  • Throughout the purchase and complaint, they behave as though they suspect the retailer wants to take advantage of them. They’re guarded. They feel justified in shading the truth or speaking outright falsehoods. 
  • They find enjoyment in dominating the retailer. Rather than wanting to achieve a gain without attention to any loss for the retailer, the opportunistic claimants want to be sure the retailer loses so that the complainer’s win is greater by comparison. 
     These are not the kinds of customers you’d like to keep. Still, before deciding whether to part company with them, the North Dakota researchers suggest you say something like, “I trust you to want to resolve this fairly.” Such explicit statements of trust have been found to reduce the guarded, exploitive customer’s suspiciousness of the retailer.

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Thursday, February 21, 2013

Increase Profit Margins for Bulls**t?

Set higher profit margins on items for which shoppers find higher value. It’s a fundamental rule of behavioral economics. Yet, does that apply when the additional value attributed has no objective rationale?
     Researchers from Stanford University and Emory University analyzed the attributed value and objective quality of wines produced under organic or biodynamic standards in France’s Alsace region.
     Organic winemaking means using minimal chemicals and allowing the soil to replenish nutrients naturally. Organic winemaking is defined by what not to do.
     Biodynamic vintners instead say what to do, and some of the instructions are out of the ordinary: Bury in the vineyards cow horns filled with the manure of lactating cows. (Okay, so it’s cow s**t, not bulls**t, but I figured my title for this post captured the flavor well enough.)
     The horns go into the soil on the autumnal equinox, and they are removed on the first day of spring. Next you combine cured manure with water and spray the mixture on the vines.
     There’s more, involving phases of the moon, a stag’s bladder, yarrow flowers, and valerian flower juice. Biodynamic winemaking standards were articulated in 1924 by Rudolph Steiner, who a couple of years earlier had laid out the rationale for the Waldorf principles of children’s education.
     Is biodynamic wine any better than organic wine? Is there an advantage that would allow a wine retailer to set a higher profit margin on a biodynamic swig?
     The Stanford/Emory researchers report that in the prestigious Robert Parker’s Wine Buyer’s Guide ratings of the top ten Alsace wines, six were biodynamic and only two were organic. When tasters saw a label indicating organic or biodynamic, the biodynamic wines prevailed.
     In blind taste tests, though, the results were mixed. The perceived advantage may be illusory.
     Still, illusion is of value, so a biodynamic certification might rightfully command an additional price. And that’s where the tale takes another twist. Biodynamic wines do not yield significantly higher profits at retail than organic wines. The researchers found the biodynamic vintners have been reluctant to label their wines as such. One is quoted as saying, “Come to me because I have good products and, on top of that, I'll give you a present: They're biodynamic.”
     Or perhaps there’s another explanation for the reluctance to label with a biodynamic certification: Considering the distinctive cultivation measures, would the labeling need to include an E. coli warning?

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Wednesday, February 20, 2013

Plant Seeds to Grow into Purchase Desires

Positives come to retailers who wait. Plant a seed in the consumer’s mind early enough for the seed to germinate. Researchers at Massachusetts Institute of Technology found that coupons presented at the store entrance drive up sales much more than do coupons available in the aisles of stores. By extension, if you deliver the coupons to the consumer a few days before they shop with you, the coupons are more likely to generate redemption desires.
     You also might benefit from waiting when coupons are to be offered subsequent to another motivator: Prospective clothing shoppers were given a flyer advertising a department store. The flyer read, “We’re contacting you because you’re fashionable and stylish,” and asked the shopper to please visit the store. Then the study participants were offered a discount coupon from the store that gave the flattery or a coupon for an equal percentage from a similar department store whose flyer had included no flattery. For those who were offered the coupon right after reading the flattery, 54% chose the coupon from the store that gave the flattery.
     That’s over half. It’s a good response. Still, we can do even better. Among those consumers not offered the coupon until three days after the flattery, the percentage grew to 80%. Praising shoppers builds sales, and the largest effect might be during the shopper’s return.
     While completing the sale, praise the shopper profusely on their choices. Then encourage the shopper to, “come by our store in a few days to let me know how the purchase worked out for you.” When that flattered shopper returns, be ready for them to make more purchases from you.
     And another example of planting a seed, then waiting: When country-of-origin information helps you make the sale, feature it. Findings from researchers at University of Illinois and Hanyang University in South Korea indicate that featuring it means presenting country-of-origin information well before you present other information about the product. Even mentioning country-of-origin immediately before describing other product attributes didn’t generate maximum effectiveness. The research findings say to do it about a day in advance.
     This would mean stating country-of-origin in ads a shopper would see before arranging to come to buy from you. To feature country-of-origin information in personal selling, state it as the first item and pause for a few seconds after saying it so the information starts taking root in the shopper’s mind.

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Tuesday, February 19, 2013

Cement Positives by Spotting Concretes

To make a sale, navigate between the concrete and abstract. Concrete words and phrases include apple, engine, hammer, and “I like the volume.” Abstract words and phrases include aptitude, essence, hatred, and “It livens me up.”
     In ads and face-to-face selling messages, concrete words are easier for consumers to process than abstract words. Because they are easier to process, these words will stand out and attract the shopper’s attention. In addition, customers unfamiliar with you and your products or services can be more likely to believe the concrete. Researchers at University of Southern California, Dartmouth College, and Yale University found that, compared to faked reviews of hotels, the genuine ones use more concrete words, such as “bathroom” and “check-in,” and fewer context-setting phrases, like, “it was our vacation,” and “my husband asked why.”
     However, based on their findings, researchers at University of Southern California and University of Texas-Austin say that once you stop the shopper with the concrete, you should then switch to the abstract. You want people to spend time contemplating what you’re saying. Abstract words and phrases help accomplish that.
     Abstract language between you and the serious shopper also indicate the sale is on track. This has to do with the fact that consumers often shade their face-to-face reports to salespeople. Even if a person doesn’t enjoy their dessert as much as they thought they would or appreciate the surprising hairstyling upon looking in the mirror, research findings and retailing experience indicate that person hesitates expressing dissatisfaction right then. Instead, when asked by the retailer, “Do you like it,” the customer will talk about some concrete feature they did enjoy. “The presentation of the dessert on the plate was good.” “With this hairdo, my eyes are set off more.” The concrete language can serve as a signal to the retailer that the shopper is less than fully satisfied.
     Erasmus University researchers found that if consumers have a positive experience with a disliked brand, they’re more likely to use concrete than abstract wording when telling others about it. The reason is that the consumers consider the positive experience with the negative brand to be an exception, so they don’t want to generalize.
     When you notice your shopper using concrete words and phrases and avoiding the more abstract statements of benefits from purchasing the item you’re selling, drill through to assess what’s in the way of cementing the deal.

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Monday, February 18, 2013

Let Sleepy Lies Lie

Your staff will lie to you. An article in Bloomberg Businessweek says it happens all the time. As if you didn’t already know that. The article says, “Most of the lying that happens at work is a simple matter of ass-covering.” As if you didn’t know that either. From your own lies, I mean.
     What to do about it?
     Many lies are harmless self-defenses. It doesn’t serve your interests to pressure the employee into admitting the falsehood. Gather what information you can about the problem, clarify your expectations about future actions, and move on. Let the lie just lie there. People will frequently change without ever admitting to others that they were wrong.
     But what if, in order to gather the information you need, you have to evaluate if the staff member is indeed lying and you want to push for the truth without pinning the employee to the wall? Here are some research-based tactics:
  • Ask your questions in a situation in which the employee is likely to feel most comfortable. Preliminary research at University of Oxford, University of Bonn, and Germany’s Institute for the Study of Labor suggests that people are less likely to lie when they’re at home, for example. 
  • Say, “Please be an honest person when talking with me about what happened.” Research at University of California-San Diego, London Business School, and Stanford University indicates this self-identity phrasing works better than, “Please be honest when talking with me about what happened.” 
  • If possible, have the employee seated while you’re standing. In any case, raise your head slightly and extend your arms so your body occupies more space than usual. Columbia University researchers found that this makes it more difficult for an employee to lie to you. 
  • Eyeball the eyes. Liars shift their gaze rapidly, or in an effort to control this sign, the liar will fix their gaze on something aside from your face and will resist looking elsewhere. 
  • Ask brief questions that require the employee to tell events in an order different from the usual one. Researchers at University of Portsmouth in the UK and University of Gothenburg in Sweden found that asking people to tell a confabulated story, but with the events in reverse order, revealed the type of nervousness associated with lying. At best, the nervousness would motivate truth-telling. At least, it would alert you to be suspicious of what you’re being told. 
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Sunday, February 17, 2013

Find Companions for Healthy Habits

German philosopher Friedrich Nietzsche wrote “There is always some madness in love. But there is also always some reason in madness.” Which leads to me wondering, what’s the relationship between love and healthy eating habits?
     Actually, what started me thinking about this while reading the Nietzsche quote are the results of a Northern Kentucky University study exploring that relationship among U.S. college students. The answer to the question is hinted at by another Nietzsche quote—“It is not a lack of love, but a lack of friendship that makes unhappy marriages.”
     The Kentucky researchers distinguished between friendship love and sexual love. The first type did increase the likelihood of a couple making healthy eating choices. The sexual love did not. In fact, a full plate of other research indicates sexual appetites arouse all sorts of appetites which can lead to all sorts of unhealthy behaviors.
     Friendship love instead arouses mutual obligation and motivates discipline when temptations appear. 
     Reporting in may not be enough, though. Resisting temptation can take clenching your fists and saying, “No, I don’t.”
     Researchers at University of Houston and Boston College assigned study participants to one of three groups based on what they were instructed to say to companions and to themselves to resist temptations:
  • “No, I won’t” 
  • “No, I can’t” 
  • “No, I don’t” 
     The “No, I don’t” group reported substantially more success than did those in the other two groups.
     University of Chicago and National University of Singapore research findings suggest that clenching your fists at the moment of temptation can help strengthen your willpower. If you bunch up your fists, extend your fingers, contract your calf muscles, or stiffen your biceps too far in advance of facing the temptation, you’ll fatigue yourself, with the result that you’re actually more likely to succumb to the unwise alternative. However, when the muscle-clenching was done at the time of temptation, the study participants were better able to accept shorter-term discomfort in the service of longer-term gain.
     It really works only when you want to resist the temptation. If you prefer to dive in and sin, your companion who is watching might notice how your clenched fists are paired with an excited smile on your face.
     Those retailers who succeed when they empower a client not to do something—such as weight loss and substance abuse clinics—do well to encourage going through programs with a supportive companion.

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Saturday, February 16, 2013

Segment the Teen Market by World View

Your teen consumers might be viewed as segmented by purchase prompts.
  • Thrills and chills having fun and spending freely. Offer these teens adventure and luxury. 
  • Quiet achievers courting approval from adults. Give them reasons for purchase they can take home with them. 
  • Bootstrappers rehearsing for their future as adults. Before closing the sale, educate about the product category. 
  • Upholders supporting traditional cultural values. If selling innovative items, describe the ways in which the new is a logical extension of the old. 
  • World savers wanting to share what they have with others. They’ll respond well to promotions in which a portion of the purchase price is donated to a favorite charity. 
  • Resigners, limiting their expectations from products they buy. Place more emphasis on protecting against losses than on enriching their current situation. 
     Your teenage retail shoppers will surely include a mix of the six segments and six motivation themes. In addition, few individual teens will be purely one of the six. Still, you’re likely to find a different mix in certain cultures than in others.
     Know what sells to teens. Compared to adults, they offer advantages as a market:
  • Typically, their housing, food, and medical expenses are covered, so they’ve more discretion in spending what money they have. 
  • Historically, parents will trim their own expenditures before cutting back on what’s spent on their children. 
  • Teens have somewhat greater tribe mentalities and greater use of social media. They’re highly concerned with what their peers think of them, but at the same time, want to have a distinctive group of peers with whom they’re in constant contact. Buying merchandise and then spreading the word on the intenet come naturally. 
     One retailing tip does apply across all six categories of teens: Illinois and Minnesota researchers discovered that when teenagers are praised for their legitimate accomplishments, those teenagers become less likely to make foolish retail purchases.
     Retailers who come to know their teenage customers and then learn about their academic, sports, and other large and small victories can help create repeat shoppers for the long term by giving justified praise. The teens are bound to blush and stammer when praised, but they'll buy more wisely. Their families, and eventually the teens themselves, will end up appreciating you for this.

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Friday, February 15, 2013

Excite Shoppers with “100% Off” Sales

If you move quickly, you can get some premium quality tea at no cost! But don’t move too quickly. Online marketer Liquid Planet is conducting an “Up to 100% Off” sale on their Tea Forte items. It’s a form of progressive discounting in which each successive day of the sale, an additional 10% off the regular purchase price is applied until, on the tenth day, you get the items for free. That is, if any items are left. This promotional discount format creates excitement for shoppers as they decide when to close the deal. Liquid Planet calls it a “risk/reward sale.”
     And until closing time today, H&R Block is giving away their services for free. They’ll prepare and file tax returns at no cost. The excitement here might come from the prospect of claiming a tax refund, or perhaps it’s from getting a burden off the shoulders.
     If you’re tempted to follow the Liquid Planet and H&R Block examples, keep in mind that free works in funny ways. Here are shopper psychology tips on using these types of free offers to your profitable advantage:
  • Free offers are a fine way to have resistant purchasers try your core services. H&R Block views the promotion as a way to draw in footsteps. But be sure to set strict enough conditions on your free offer. The H&R Block promotion covers only the filing of the federal 1040EZ. The company estimates that many of the people coming in for the free offer will learn that they need to file forms for which there is a fee. For those who don’t, H&R Block estimates 55% will be in that situation within two years. 
  • Make all conditions abundantly clear, especially with online offers and especially when it comes to shipping and handling fees. Ecommerce shoppers are so accustomed to getting things of value at no cost that they feel betrayed when they expect it to happen and then are told they’ll have to pay. 
  • As Liquid Planet has done, be sure to state the usual price of whatever it is you’re giving away. Better yet, if what you’re thinking of giving away is part of your core business, considering charging a token fee instead. Researchers at Monash University in Australia find that consumers have an easier time recognizing the value of a big discount when charged a token price than when getting it for free. 
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Thursday, February 14, 2013

Offer Grandparent/Grandchild Experiences

Carol Banks Setter with online marketing consultants Band Digital has written a tactic-filled MediaPost article recommending that travel retailers offer up experiences which affluent grandparents can enjoy with their young grandchildren. I believe many of her ideas would be profitable for a broader range of retailers and shoppers:
  • Most grandparents want to buy experiences their grandchildren will enjoy along with them. Consumers are often operating on the assumption that they'll have more time in the future, but not necessarily more money. This doesn't mean at all that the consumers are satisfied to be wasting time. On the contrary, they want to feel in control of their time. To sell family-oriented experiences, advertise the benefits for shared enjoyment. 
  • If the item is, like a cruise or construction project, one in which the adults and children will be together for a prolonged time, the grandparents almost surely will also want activities the children can do with other children, giving the older adults an opportunity to rest and recreate. 
  • Build in anticipation. Tell shoppers where they and their grandchildren can go online to see photos and descriptions of family groups like theirs enjoying the activities. Be sure the variety of ages, ethnicities, and other demographics in the photos and text are broad enough to establish identification for the spectrum of family groups you’d like to attract. Keep in mind the value of showing older children, since this can start the mental wheels turning about “what we’ll do next year when we come back here again.” 
  • Build memories. Have opportunities for photo shoots of the whole group who are participating. Check that the activities are in places without any internet connection dead spots. Take photos yourself and get endorsements you’ll use both to build memories for the cross-generation participants and to enhance the influence of your marketing materials for future sessions. 
  • Sell all-inclusive packages. Use the ocean cruise business model. Grandparents will get irritated with you if you require them to say no too often to a grandchild’s requests. 
  • You might offer a family activity for free as a traffic-builder. The travel retailer could hold an event where grandparents and grandchildren plan a cruise together. A grocery or kitchen implements merchant might hold a grandparents/grandchildren cooking class, where any fee would be only enough to defray expenses. 
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Offer Family-Oriented Experiences

Wednesday, February 13, 2013

Blink and Gone Is the Bling

A New York Times Fashion & Style piece this week witnesses a trend toward basics. Since clothing fashions can both reflect and influence broader fashions in consumer thinking, analyze what this trend means for you, retailer, in fulfilling the expectations of your shoppers.
     On the runway models are less noisy prints and fewer fringes. Bling has disappeared seemingly in a blink. What’s come to the foreground are sturdy fabrics, intricate seaming, and tailored fit.
     Designer/retailer Jil Sander told the NYT she prefers the term “purity” to “minimalism” in describing the trend. “Minimalism” implies a dearth of attention to detail, but the emerging fashion is permeated with concern with getting all the details right. When the gewgaws are gone, it’s much harder to hide any sloppiness.
     There are more clear lines in the wardrobe items, but still many instances of rounded touches. Consumer psychology research indicates this is a good decision, since women shoppers prefer to have some curves and alcoves in the shopping experience.
     Lucky Brand stores presaged the purity trend last year. In early 2010, sales per square foot at Lucky Brand stores equaled $380. The goal of a 2012 store revamp was to raise this to $600 by early 2015. Fueling the profitability drive is simplification for shoppers of both genders via store redesign.
  • Whatever fashions are shown in the display window outside the store are stocked close to the front door for easy pickings. 
  • Whole outfits are displayed together for shoppers who question their eye-eye coordination. 
  • Upper shelves inside the store are used for display rather than for holding merchandise. This cuts down on the need to stretch the body while stretching the budget. 
     Achieving simplicity for the shopper requires complex attention to details for Lucky Brand store management and staff. Instructions are contained in an inch-thick manual. Further, purity does not mean depriving the shopper of special touches. Although whole outfits are displayed together, the shopper can easily mix and match. And employees at the cash/wrap sheathe purchases in tissue paper before placing them in the shopping bag.
     Oh, yes. The design of the shopping bag was simplified, too.
     Purity in shopping is defined differently for different consumers. Lucky Brand learned that women prefer to have jeans displayed on hangers for easier imagination of the look on the body, while men want jeans stacked on shelves for more quickly locating the suitable size and cut.

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Simplify the Shopping

Tuesday, February 12, 2013

Stay Humble When It Comes to Handcrafted

If selling items for which you want to project the special qualities of craftsmanship, be careful of the doppelganger—from the German and defined as a ghostly counterpart of a living entity.
      Researchers at University of Wisconsin-Madison documented how Starbucks is suffering from a “doppelganger brand image” in which the company’s branding of the shops as an authentic coffee experience has come around to haunt Starbucks. Many customers after being convinced of the importance of such an experience decided Starbucks was bragging too much about their ability to be authentic. Those customers gave up on Starbucks and aimed for other shops which showed more humility.
     Etsy, the online retailer of craft goods made by others, is struggling with those issues, according to an article in Time magazine. Etsy wants to continue to grow revenues, and that’s facilitated by the artisans ramping up production. But mass production corrupts the positive image of handcrafted. Early on, Etsy required that the vendors employ only themselves, their relatives, or people living with them to produce the items sold. When an Etsy seller named Ecological Malibu was found to have been outsourcing work, other sellers cried foul.
     The Time article implies the cries were about unfair competition. I believe a greater danger was the prospect of a doppelganger brand image. Etsy buyers had been sold on the aura of personally handcrafted from me to you. That aura was being corrupted, and Etsy buyers would start looking elsewhere for sellers they could trust.
     CB2, a Crate and Barrel spinoff, is one of the retailers benefitting from the call for crafts. And CB2 encountered a doppelganger dilemma when they hired a craftsman to hand-build a limited edition of 200 American black walnut side tables, which were peddled at twelve stores and via the online catalog. Even at a production run of 200, a claim of uniqueness or of handcrafted authenticity wears like a thin veneer. The artisan was quoted as saying, “I felt like an employee at a Ford plant, drilling 1,200 holes in a day or two.” A brag of “uniquely authentic” starts sounding to consumers like a synonym for “faddishly routine.”
     Etsy may choose to forgo the humility of handcrafted in favor of market share expansion. Still, Brett Childs, an Etsy seller featured in the Time article does recognize the link. He said, “We don’t like to come off as too successful.”

For your profitability: Sell Well: What Really Moves Your Shoppers

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Authenticate Subtly 
Brag About Your Retailing Humility

Monday, February 11, 2013

Distinguish Yourself from Your Suppliers

According to the latest PwC survey of online shoppers, your store may have an unrecognized competitor—the manufacturers of items you sell. About 52% of the U.S. online shoppers surveyed said they buy directly from brand sites. Across the eleven countries (Brazil, Canada, China, France, Germany, the Netherlands, Russia, Switzerland, Turkey, the U.K., and the U.S.) in which the 11,067 consumers were surveyed, the figure was 35%.
     The top reasons given by the consumers were “lower price” and “full range or more choices.” Those present challenging comparison points for small to midsize store-based retailers. It may not be as bad as it looks at first glance, however. Respondents who said they buy directly from brand sites aren’t saying they do most of their buying there, just that they do at least some of their buying that way. Another important finding in the PwC project is that there’s no evidence online retailing is hugely cannibalizing sales in other channels.
     Still, there’s a threat to maximizing your profitability arising from manufacturers’ sites. What distinctive advantages will you highlight to your target audiences to head off the threat?
  • In the PwC survey, fully 30% of respondents said a reason they buy from a manufacturer’s site is all they needed was one brand. Researchers at University of Minnesota found that when a customer purchases an item carrying a specific brand name, the customer becomes more likely to prefer the same brand name when going on to select an accompanying item. But many of your shoppers may be better served by your expertise in combining items from across the brands you carry. Demonstrate this to your customers. 
  • Show off your house brands. What does the house brand offer that the national name brand does not? Better price? Higher quality? When items carry the same brand name across product categories—such as a bath soap and a shampoo—you’d like to strengthen the brand image by having the same package design. Using almost identical package designs is common with private label house brands, where a consumer could be looking at tables and tacos during one shopping trip. Overall, employing a similar package design to build brand image is a good idea from a shopper psychology perspective. Mere familiarity brings credibility. 
  • The PwC report suggests you offer better satisfaction assurances than the manufacturer does. Being able to resolve any problems face-to-face locally is a selling point. 
Click below for more: 
Consider Matching Brand Effects 
Build House Brand Equity with Distinction

Sunday, February 10, 2013

Accept Shopper Concerns About Acceptance

People want to belong. Research from San Francisco State University indicates that in store settings, this influences whether they buy items similar to what others with them are buying. If a shopper feels accepted by people in the group, they’re more likely to aim for distinctiveness. Shoppers who are unsure of their status with the group tend to choose what leaders in the group are selecting.
     Also, whether a shopper is a variety seeker or conformist is determined by the degree of conformity of the group members. In an observational study conducted with diners at Flam's in Paris by researchers from Sorbonne-Assas in France and University of Adelaide in Australia, when about 30% to 80% of a group had ordered the same choice, people placing their orders next tended to go along with ordering this choice for themselves. But once the conformity exceeded 80%, subsequent orders were much more likely to show variety seeking.
     If you're selling socks or socket wrenches instead of steaks, doing business in Paris, Texas, not Paris, France, and accounting for shoppers’ worries about group acceptance, the percentages will probably be different. But in any case, do your merchandising with the expectation you'll be having both conformists and variety seekers as shoppers.
     You’ll increase sales when you help your shoppers reach their favorite spot on the conformity-distinctiveness scale. Research findings from University of South Carolina, Loyola University, and Baruch College suggest that one tool you have for doing this is the phrasing of a certain preferences question:
  • If you ask your customer, “What about this product do you like that your friends would also like?,” this prompts individual distinctiveness, since it puts your customer in the role of advisor and perhaps opinion leader. 
  • However, if you ask your customer, “What about this product do your friends like and you also like?,” this prompts the customer to think about the comfort of adhering to group preferences. 
  • In general, middle-aged shoppers are more likely to seek distinctiveness than conformity. Teenagers tend to opt for conformity with groups they aspire to belong to. 
     Overall, consumers are more interested in conformity when it comes to fashion items, such as clothing and entertainment products. They’re relatively less interested in conformity with functional items, like appliances and foods. With functional items, shoppers are more interested in what others think of a product than what others think of people choosing that product.

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Expect Shopper Conformity & Variety Seeking 
Navigate Shoppers Toward Distinctiveness

Saturday, February 9, 2013

Draw On What Draws In Traffic

Anyway, this doctor is sitting at his computer after everybody’s gone home for the night. He hears footsteps, looks up, and sees a man walking in.
     “Excuse me. I do hate to bother you, doctor, but I keep thinking I’m a moth.”
     “Afraid you have the wrong place, fella. I’m a cardiologist. You need to see a psychiatrist.”
     “Yes, yes, I know,” says the man.
     “So why’d you come in here if you need a psychiatrist?”
     The man shrugs, “Well, the light was on.”
     How nice if all it took to draw traffic into your store was to turn on the lights. It does take much more. Still, one significant consideration is, indeed, the flow of traffic. Analyze pedestrian flow. Since you asking a new store visitor, “What brought you to our store today?,” might occasionally produce the answer, “I took the bus,” know the proximity of public transit stops and the frequency of service.
     But if you’re appealing to consumers in cars, it’s the vehicular traffic patterns which count. You might find that during commute hours, there are many more cars driving past your parking areas than at other hours, so you'll want to be open then. On the other hand, heavy traffic could mean some shoppers, such as senior citizens, want to avoid being on the road. What's convenient for them would be off-commute hours. Barriers to convenience might include your customers needing to make a left turn instead of a right turn to get into your parking lot, so they're more comfortable shopping on the way to work instead of on the way back.
     In what ways can you keep it easy for your customers to get to you and back during heavy vehicle traffic times? What can you do to make the shopping more efficient once the customers are with you?
     Stay aware of special events taking place around your store, Parades and plays. Football games and fairs. They bring more people into the area, and they extend the hours people might be interested in shopping with you. What are you doing to welcome them with open doors? How do you ensure you're providing superb, convenient customer service to the out-of-town traffic, ensuring the people will want to come back to shop with you soon and often again?
     Think up many bright ideas for you drawing on traffic patterns. You’ll be pleased by what flies in.

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Stay Convenient to Your Customers 
Learn From & Coach Other Businesses 
Mind Your Windows 
Attend to Context When Advertising

Friday, February 8, 2013

Gather Your Love Tribe Together

Combining bricks-and-mortar with online retailing is extremely common these days. Still, the pairing of eight Banana Republic B&M stores with online dating site does stand out. For this upcoming Valentine’s Day, the stores in San Francisco, New York, Chicago, and five other locations are hosting shopper-to-shopper meet-and-greet events for subscribers.
     It could work out nicely for Banana Republic. People spend more, on average, when they shop in groups than when they shop individually. Research at University of Pittsburgh and University of Alberta suggests the effect is greater for men than for women. This seems to be because men are more interested in showing off by buying big than are women.
     But I’m thinking you might do even better by building among your special event guests deep love toward your store as much as toward each other. When a group of your customers share not only an allegiance to your store, but also a passion for shopping with you, and when those customers share their passion with each other, you’ve what researchers call a “consumer tribe.” Holding special events just for favored customers and encouraging group shopping are among the methods for nourishing consumer tribes.
     Historically, a substantial part of the consumer tribe’s social interactions would be conducted outside your presence at their own gatherings. This limited your influence with the tribe somewhat. Now social networking is frequently a medium for exchange among the tribe members. This lets you tune in. Use the opportunity. It isn’t a replacement for special events, though, in which you personally express your gratitude to your tribe.
     The passion happens more easily when your staff are as much in love with your store as you want your shoppers to be. So even if you don’t have time to do it before this Valentine’s Day, start using online resources for staff-store matchmaking. Social media channels allow the job seeker to assess the personality of your business from what you, the owner or operator, choose to show and tell.
  • Include material on your social media sites to reflect the history and the culture of your store 
  • Encourage your current employees to contribute material to the pages, and then comment as the owner/operator on what’s been contributed 
  • Invite job seekers to ask questions via the site, and then answer the questions in ways appealing to the types of people you’d like to have working for you 
Click below for more: 
Try Being a Tribe Without Reservations 
Matchmake with Social Media

Thursday, February 7, 2013

Scold Misbehaving Shoppers Publicly

Do it as gently as possible while still making your point. But whenever a shopper violates the norms of courteous store behavior in front of other shoppers, clearly call out the offense and offender. Researchers at University of British Columbia and University of Alberta find that unless you do the scolding yourself, the other shoppers may do it, leading to problems.
     Too often, people will cut in front of others who are waiting in a checkout line, ravage the tray of free samples so that none of the good ones are left for others, or unnecessarily create a huge mess at a merchandise display. The British Columbia/Alberta researchers saw that other shoppers who witness this happening are tempted to punish the offender. The observers do fear embarrassing themselves, but also have trouble looking the other way. All this is to your disadvantage as a retailer for two reasons.
     First, the mental turmoil inside the heads of these shoppers preoccupies their thinking, if only for a brief time, and preoccupied consumers buy less. Worse yet is if the miscreant bounces from one offensive behavior to another as the shoppers and store staff are watching.
     Secondly, you don’t want fights breaking out in the aisles of your store.
     There are reasons the offender is likely to be forgiven by the others, so that there’s less need for you to intervene:
  • If it’s obvious the consumer has been treated unfairly or experienced adverse circumstances while trying to complete their shopping. One example in the research is of an airline passenger who just before completing check-in is told the computer has gone down, and the passenger later butts into line at the security screening. 
  • If the shopper has a negative physical attribute which is perceived as being beyond personal control. The example in the research was of someone who has a visible medical condition. 
  • If the offender is of high status. Rank has its privileges in the civilian as well as military world, it would seem. 
     Store d├ęcor also can make a difference. Researchers at Harvard University and University of North Carolina found that adults behaved themselves better when in environments where childhood playthings—such as teddy bears and crayons—were around. In the study, participants carrying out business around the playthings better respected the norms of courteous shopping and were less likely to yell at each other if somebody violated the norms.

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Prime for Good Behavior with Family Cues 
Show Respect in Front of Customers

Wednesday, February 6, 2013

Prepare for Prepaid Retailing Growth

According to the Wall Street Journal, investors in Green Dot Corp. are worried about the company’s future. Green Dot sells prepaid debit cards for use in retail stores. The worry is that prepaid has become so popular competitors like American Express Co. and Western Union Co. who have entered the market will steal substantial share from Green Dot. Those two competitors have broader brand recognition and more diversified income portfolios.
     The relevance for you is that prepaid is popular. Actually, it’s been quite popular under a different name: Gift cards are the single most requested item for the holidays. More than 55% of adults say that’s their present of choice.
     Different versions of flat free pricing also have the customer pay up front:
  • Protect against bad surprises. With a retainer system, people pay for legal insurance or ID theft insurance at the start of a service period. For whatever types of services you sell, you could offer priority attention for needs that arise during the one year after payment is made. 
  • Surprise me. Subscriptions to periodicals and Community Supported Agriculture fit in this category. So do the shoe-of-the-month clubs in which subscribers are offered a selection every time the calendar page turns. The selection is determined by answers to questions the member gave upon enrollment, the member’s past purchases, and the club’s data about all members’ purchasing preferences. How might you adapt this idea to increase the range of income sources for items you sell? 
  • Not at all surprising. People who join health clubs or enroll in classes pay in advance, knowing what they’ll get in return. Maybe the only surprise is when the purchaser recognizes it’s not all turnkey. A few Januarys ago, I spotted an unfamiliar face and body in the men’s locker room at the Gold’s Gym I frequent. Since he looked truly downcast, I walked over to him and asked, “Are you all right?” He looked up at me and said, “I’m realizing that you can’t just sign up. You have to go out there and exercise.” Health club retailer Planet Fitness has used “Pat On the Back” and “Judgement Free Zone” campaigns. 
     Here are two research-based tips for flat fee pricing plans:
  • To maintain goodwill, allow cancellations, but with a penalty 
  • In estimating capacity, realize the purchasers tend to make more use of their prepaid prerogatives at the start of the period than later. 
Click below for more: 
Reenergize Gift Card Sales 
Shoe Things for Higher Sales Revenues 
Bet on Consumers Wanting Turnkey Experiences 
Get Customers In Touch with Each Other

Tuesday, February 5, 2013

Build or Prune Depending on Trust Levels

Many products and services are available to be customized with a range of optional add-ons. One way you might present such an item is to start with the bare-bones version and then offer suggestions for augmentations. Another way would be to start with the fully loaded model and then, if the shopper seems overwhelmed by the complexity or price, offer ideas for options which could be pruned out.
     In either case, your recommendations are more likely to be accepted by the shopper if you precede your recommendations by probing with questions to learn about the shopper and how the shopper plans to use the item. This line of questioning provides you the information to deliver advice which is on-target for this individual consumer. It also means your recommendations will come across as credible.
     When you do this and in other ways dispel any impressions that you’re placing the interests of the store above those of the shopper, researchers at University of Melbourne have advice for you about giving add-on or take-off advice to the shopper: Start with the bare-bones model and build up.
     However, say the researchers, if you sense that the shopper still doesn’t trust your motives, you improve your chances of making a sale by promptly moving to consideration of the fully loaded model and suggesting what could be pruned off.
     All of this depends on the shopper first knowing customization is available and being aware of the types of options. The general rule in presenting alternatives to a shopper is to start with the most feature-rich and expensive and then move toward the less rich choices.
     Further, the advice can be different if the item is a gift. When selecting a gift, customization requires the shopper to think in depth about the recipient, which afterwards enables presentation of the gift in an especially meaningful way. This dynamic holds true for more than adults. People like to personalize for the children and even for pets they love.
     University of Colorado, Florida State University, and Indiana University research findings indicate you should take care to limit the design support. The more time and mental effort the gift giver devotes to the customizing, the more they are willing to pay for the item. Answer the shopper’s questions, but if asked, “Which options should I add?,” give as a first answer, “Well, you know the recipient better than I do.”

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Offer Customers Basic Plus Add-Ons 
Limit Design Support for Personalized Gifts

Monday, February 4, 2013

Meet the Yen for Protein Power

Consumers want protein. The psychology behind the appeal is a desire for power, and that desire can motivate purchases of a broad range of retail offerings. It’s much more than meat, poultry, and fish for dinner. Market intelligence firm Mintel reports that about 20% of new product launches of high protein food and drink in the U.S. last year were for snack items.
     The Mintel report says the yen for protein power is higher among American consumers than among consumers in any other nation. The consumers’ intentional objectives include losing weight and building muscles. Another benefit, sometimes operating subconsciously, is the consumer’s use of protein for feelings of well-being after eating. About nine out of ten American consumers say this feeling is important to them when deciding whether to purchase an item again.
     Older consumers are somewhat more likely than younger ones to want their protein in beef products because beef traditionally has associations with power. But there’s been a change over time, with younger consumers finding power instead from physical fitness.
     A couple of years ago, when the National Pork Board switched their slogan from “Pork The Other White Meat” to “Pork. Be Inspired,” the Board said a Northwestern University study concluded the “Other White Meat” slogan was among the top five most recognizable slogans in contemporary advertising history. The “Other White Meat” marketing campaign helped reposition pork in the consumer’s mind from a greasy, fatty foodstuff to a meat as slender and nutritious as chicken. Helping along, the industry worked through genetics to change the composition of pork. These days, a pork tenderloin does actually contain slightly less fat than a skinless chicken breast.
     On the other hand, the Mintel report notes how certain consumers find power in commitments to move away from eating meat at all. These consumers perceive health, environmental, and ethical benefits. In second place after the U.S. in 2012 product launches of protein products is India, where the slaughter of cattle is highly restricted. Over the past five years, the number of global high-protein vegan product launches has grown 54%.
     Retailers also are finding a niche appeal in offering protein from unconventional sources. NYC’s Brooklyn Kitchen drew notice for their Mexican feast special which included smoked corn custard sprinkled with pale yellow, squirming wax moth larvae along with chapulines, those little fried grasshoppers described as tasting like the exoskeleton of a potato chip.

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Head On In To Portray Power Products 
Bug Shoppers with the Positives

Sunday, February 3, 2013

Spread the Love Objects

To derive maximum revenues from your Valentine’s Day selling, have items available for your shoppers’ associates and acquaintances as well as for their lovers. Also emphasize gifts for younger adults.
     According to the National Retail Federation, about 60% of American adults will be buying, and those who do buy will be spending about $131 on average compared to about $126 last year. The increase comes from items purchased for people aside from the main sweetheart. About 91% will be buying for a significant other, 60% for other family members, 39% for coworkers, 34% for friends, 30% for their children’s classmates and teachers, and as for pets, 20% of the shoppers will be spending money there.
     Younger consumers are more likely than older consumers to buy for this holiday.
     As in past years, men are predicted to outspend women—this year, by twice as much. For all shoppers, the most popular gifts will be candy (51% of shoppers), flowers (37%), jewelry (20%), clothing (16%), and gift cards (15%).
     And as in past years, there are cross-currents in pricing considerations for Valentine’s Day items. Choose among three trends:
  • Cut prices to build sales among those ambivalent about spending money. Researchers at University of Nevada-Las Vegas and University of Georgia-Athens documented a trend for couples in long-term relationships to resist the pressure to buy gifts. Some of the research participants were irritated even at the expectation they’d buy greeting cards. “Valentine’s Day is a great marketing scam by the greeting card people,” said one. Moreover, the research found evidence that retailers who hype Valentine’s Day purchases risk alienating consumers in ways that would last well beyond February. 
  • Raise prices the week before Valentine’s Day because price sensitivity fades. Research findings from Stanford University, University of California-Berkeley, and University of Chicago suggest that when a gift is expected, the giver waiting until the last minute gets increasingly interested in avoiding pain. The result is they’re willing to pay more for a gift and often more willing to upgrade to a fancier gift. The UNLV and University of Georgia researchers might agree this is true for younger lovers, even if not for those in long-term relationships. 
  • Keep prices steady. This might be the best alternative, but monitor your sales and customer reactions so you can make last-minute adjustments this year or at least get some baseline information to help in next year’s pricing plans. 
Click below for more: 
Update Valentine’s Day Pricing Plans 
Gobble Those Valentine Chocolates Guilt-Free

Saturday, February 2, 2013

Back the Appeal with a Backstory

Products sell better when each item comes with a tale to give it distinction. Retailers of antiques, art objects, and handmade crafts find that easier to do than those who sell toasters or toilet paper. With the toasters, toilet paper, and other commodity items, the background narrative sometimes should best be about the store itself.
     A backstory can be related online and in a paper catalog. Recall the elaborate tales about product offerings told by the J. Peterman character in “Seinfeld.” That character was inspired by the owner of the real-life mail order retailer The J. Peterman Company, which carries the tag line “Traveling the world to find uncommonly good stuff.”
     In whatever way a compelling backstory is delivered, the entertainment prolongs the shopper’s attention, giving you the opportunity to dramatize the benefits the consumer would find in purchasing the product. Backstories also give your customers conversation starters as they generate word-of-mouth about your store and the offerings. Have product literature available to your shoppers to take away with them not just before they complete the purchase, but also afterwards. Invite them to come back to inform you how the purchase worked out, and when they come back with a happy tale, admire their skills in making the right decision. Then use snippets from those tales to build the backstory further.
     A backstory delivered face-to-face to the customer adds the appeal of exclusivity. The impression, deserved or not, is that the shopper is privileged to be told the tale.
     A Bloomberg Businessweek posting describes how boutique retailer Valentino is arranging for customers to meet the designers of cocktail dresses, handbags, and espadrilles so they can hear backstories from the sources. Gucci offers tours of the Florence, Italy workshop to selected customers who would be influenced by the sense that not everybody is invited.
     Yet you don’t need to be a luxury retailer to benefit from backstories. And the advantages work for your staff as well as for shoppers. Every new employee at every Nike store is told the magical tale about the track coach in Oregon who poured rubber into his family’s waffle iron to produce better shoes for his team’s runners—the innovation that inspired the Nike waffle sole.
     Every employee at every store is told the backstory? Well, maybe not. However, when people accept a story as possibly true, they are open to being informed and motivated.

Click below for more: 
Top Off Skilled Product Selection 
Have Post-Sale Product Literature 
Mythologize Your Store