The Crushing of Retail Sales and The Box

Online retail sales are crushing brick and mortar sales in many areas and it will only continue. I'll get to the facts on that in just a moment Amazon Box but first a story:

Several weeks ago my wife purchased a new cup for our three year-old grandson. He likes the Hawkeyes. When she presented it to him he looked her and said, "Thanks! Where's the box?" The box? She went on to explain that she purchased the cup from a store and that it didn't come with a "box". He looked at her with a serious questioning face and said, "No box?" He is three and he could not imagine that something new was brought into his house and it didn't come in a box.

Thank you Amazon and now for the facts:

Retail giant Wal-Mart reported solid fourth-quarter results last week with the U.S. business producing another quarter of comparable-sales growth. But the star of the show was e-commerce. Online U.S. sales for Wal-Mart soared 29% year-over-year, an acceleration driven by the company's investments in the acquisition of Jet.com. E-commerce is still small, relative to the brick-and-mortar operations, but that won't remain true for long.

According to the Department of Commerce, total e-commerce sales in the United States rose by 15.1% in 2016, far faster than the 2.9% Online Add to Cartgrowth in total retail sales.

The times they are a changin'.

The reality is that consumers are quickly leaving brick and mortar stores for online deals. They are shopping price as well as convenience as they have seen their wages stagnate and are left with less time to "go shopping". However, the trend isn't always the same for small business retail stores. Especially if they offer a unique shopping experience. So, what can retail, maybe your retail, do to drive traffic to your store? Here are some thoughts:

  • It Ain't About the Product - I can go to big box or online and buy a set of kitchen knives but I can not get the experience that comes with visiting, say, The Kitchen Collage in the East Village of Des Moines or La Gourmet in Valley Junction of West Des Moines. No big box or online retail center can match that experience;
  • Personalized E-Mail Offers - Because your small business is gathering emails (you are right) you can build a very active email campaign to keep your loyal shoppers in the conversation;
  • Retail Celebrations - Places like the East Village and Valley Junction hold special events all of the time...that's not done for big box stores. Getting involved with your neighborhood organization or Chamber can make a difference;
  • Be Exclusive - When going to market find stuff that can't easily be found online and then market that through social media and your email campaign.

All of this takes work...go get 'em!

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Six Retail Marketing Tips - Small Business Saturday

Coming up on Saturday November 26th is National Small Business Saturday. If you own Small-Business-Saturday-Header-Undated that brick and mortar business allow me to offer up some marketing tips that will help you beat out the Big Box.

First, let’s consider what the impact of Small Business Saturday is for business. Check these numbers! According to a recent Sales Fuel survey last year 23 percent of U.S. adults shopped at a locally owned business on Small Business Saturday. While that is lower than the 33 percent of adults who shopped online during Cyber Monday more than half of those online shoppers said they would rather shop at small, locally owned businesses if the price and product quality is similar. And get this… Millennials aged 25 to 34 make up the single largest segment of Small Business Saturday shoppers at nearly 25 percent…  So quit worrying that all this demographic does is shop online…they don’t. 

So, how can you grab their attention from Millennials to Boomers?  Let’s go!

Start now. More than half of last year’s Small Business Saturday shoppers also shopped at brick-and-mortar stores on Black Friday. This behavior means they might be tapped out and less motivated to shop on Small Business Saturday. To avoid this, create a marketing plan that includes consistent outreach from now until Small Business Saturday. What should that plan include?

  • In-Store Signage – Reminding shoppers that Saturday is Small Business Saturday and you’ve got even more deals coming.
  • Social Media Outreach – Do the same here remind folks that dollars spent locally stay local…it matters;
  • Photo Op – Take a section of your store and decorate with fun stuff so folks can take selfies of their shopping experience…they will share and you can also share on Instagram and Snapchat;
  • Traditional Marketing – If you’re buying ads to promote Black Friday also mention Small Business Saturday.

Make it mobile - Small Business Saturday shoppers will be turning to their smartphones to locate local stores, find product information and reviews, and compare prices. If you have free Wi-Fi let customers know. If you are doing email marketing make sure those messages are mobile friendly and any links go to mobile friendly landing pages that speak to shopping opportunities in your store. If you are doing text message marketing because nearly 36 percent of Millennials in the study say they took action base on such advertising.

Give your business website and local search presence a going-over - Your store should be listed on local search directories; check to be sure that the information listed there and on your business website is complete and accurate. In particular, your store’s address, hours and phone number should be easy to find. If you have special holiday hours, keep them updated or post a list of daily hours throughout the holiday season.

So…does it matter?  Just this past week I was looking for a phone number of a small business in the Des Moines Metro…on the business website. Not only was the website not mobile friendly but I could not find a way to connect by phone…no phone listed!  ACK…

Be social - Millennials are 57 percent more likely than the average shopper to take action based on an ad on a social network. Getting attention with organic Facebook posts has become more difficult, but Facebook advertising is quite affordable and effective. You can set a budget, monitor results and target your advertising very narrowly to people within your local community. Pair your Facebook advertising with a strong presence on Instagram and maybe even Snapchat.

Send the right message - Savvy shoppers crave the unique and individual. Your marketing messages should emphasize what makes your store stand out from big-box retailers. In addition to personal service and a friendly greeting, one-of-a-kind products, a carefully curated selection of items and gifts that people will find not only appealing but also priced right. Entice shoppers into your store with the back-story of why your business exists…

If you do a google search for Small Business Saturday you’ll find a page dedicated to specific free printable items you can use to help market your small business. If you are reading this piece on our blog here is that link.

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Marketing Banks - What You Need To Do

If I were running the marketing department at my locally owned bank or savings and loan I Bank Imagewould crush "Big Bank Competition" and it would be so easy they would write books about it. 

Let me set the stage for you.

Since the Great Recession banks had been trying to rebuild their reputation among consumers and some had turned the corner. But then the Wells Fargo scandal erupted and it's been a Big Bank Nightmare. Case in point, Wells Fargo, last week, said that in September the number of checking accounts opened fell by 25 percent and the number of credit card openings have dropped by 20 percent compared to a year ago.

But, Wells Fargo is not alone. An Accenture survey found that only 30 percent of bank customers say they're loyal to their bank, and about a quarter were shopping around for another institution.

A Gallup poll conducted in June, before the Wells Fargo scandal broke, found that Americans' trust in banks plunged 22 percentage points from 10 years earlier. While nearly half of respondents said before the recession that they trust banks, just over one in four say the same now.

Take a moment and review those numbers.

Now, let's steal Big Bank Customers...ready?

  • Meet The Decision Makers - Tomorrow I would scrap all the glitzy ad stuff and focus on having consumers meet the people who make banking decisions. We'd do this with video, blogs, social media...get out from behind the desk and get in front of the consumer;
  • Mr. President You're On - The bank president might have the corner office but it's time to get out and head to where the people are. If you were our client the bank president would be out of the office twice a week visiting with consumers at everything from Chamber Functions to High School Football games;
  • Record the Action - If your bank or savings and loan were my client we'd send a staffer with you to record video and still images of you being with consumers and potential customers and then share that in your Bank Blog;
  • Ramp Up Cause Marketing - Pick a charity...better yet...pick three and then make some serious donations of time and money to those local charities...and don't pick the "fancy" charities that EVERYBODY gives to...match the community need to the target consumer. BTW critters and kids always work best;
  • Forget About Yield - Please don't tell me that I'll get zip on my savings or that I am insured by FDIC (OK ya gotta do that) talk to ME..recognize that we need to build a relationship outside of earnings;
  • Formal Listening Posts - Get focus groups together, hold listening posts on a number of hot topics from credit repair to student loans to saving for college to business start-ups and then hold public meetings to offer solid advice. And, don't sent the marketing department...you Mr. President...go!

I promise you that you'll make a significant impact in your community and in your bottom line. But, more importantly you will become part of the community who is searching for...integrity.

You are welcome!   

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Got a Mobile Strategy?

When we saw the headline in Advertising Age it was stunning: "Even as Mobile Gobbles Up Web Traffic 80% of Companies Don't Have a Long Term Strategy" Man Confused

Let that one sink in for a moment.

And, we're not talking about "Mom and Pop" brands or small business this was a survey among 4,000 seasoned marketers from around the world who admit that 37% of their digital traffic is coming from mobile, up from 31% in two years.

When we talk about mobile traffic here in the United States get this...according to SimilarWeb, 56 percent of traffic to the leading U.S.-based websites was from mobile devices in 2015.

This all poses two very important questions for you and your business:

  • Are You Mobile Friendly - Just yesterday I was directed to a media relations company website that was still not optimized for mobile. They are not alone. Why cut out over half of your potential client base. Get your website mobile friendly this week;
  • What is Your Digital Game - Consumers want to hear from you on their terms and they want to do that wherever they are. Failing to understand digital applications for business is shutting out consumers and that's bad for business.

There are all sorts of folks who can help you adapt to this technology but you need a plan, a starting point. You need to know how and where people are finding you and how they interact with your business. If you don't know...start asking. But, remember, you must replace customers on a regular basis so just because the majority of consumers may now find you outside of mobile...don't bank on that for the future.

There's much to learn and do to remain relevant. Go! 

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Ad Blocking - What it Means for Business

Hang on because those of you who are spending money on popup or banner ads on websites Road Closedare in for a bit of a shock. The use of ad blocking is growing rapidly. A full 25% of internet users currently use ad blocking software and that number is expected to double in 2016. Double... Here's the story from eMarketer.

We already know that people are skipping through ads on broadcast television. We already know that people tune out ads on the radio. We already know that click-through rates on internet ads is dismal. We already know that most email marketing has a lousy click through rate IF it gets past the "Junk Mail" folder.

Why?

Because most advertising done on a local level is just plain...bad. There is no incentive to NOT block or skip or open the marketing message because...it's usually done poorly.

What to do?  Here are some solid tips to help you and your business get noticed:

Get Creative - Yes it costs money for good creative but you want your message to be seen/heard...correct? Lousy creative means lousy response. Give consumers a reason NOT to BLOCK your message. It makes no sense to spend $5,000 on an advertising campaign and spend zero on creative. It's called "burning money";

Get Social - If your marketing is not correctly using social media you are not going to be successful in reaching consumers. It takes planning and thought and work and consistency to pull off a successful social media campaign...not some "intern" who "knows the internet". Sit down and think...think about your message, your customers, where they hang out, what they want and then communicate with them...socially.

Get Busy - Reaching out to your current or potential customer requires you to know what is hot and what is not. There are, according to my good friend Mike Wagner, only three reasons why people are not buying what you are selling: 1) Wrong Product, 2) Wrong People, 3) Wrong Message.

There is help available. I know dozens of professional advertising/marketing people in the country. The question to you is...do you want the help or are you blocking this message?

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Can Local Retail Compete with Amazon?

The information from the report is stunning. According to data compiled by Forrester Research…Amazon.com generated about 60% of total U.S. online sales growth in 2015 far outpacing the Amazon Logo competition.

The report found that the retail giant tallied $23 billion more in U.S. e-commerce sales in 2015 than 2014. Twenty-Three billion...dollars more in sales in just one year.  And that's not all...Forrester forecasts that U.S. e-commerce sales will grow to more than $530 billion by 2020, with more than 206 million shoppers spending money online. 

Is it any wonder that mall anchor stores and big box stores are closing so quickly. We have entered into a new economic reality and one that sends shivers down to spine of every small business retailer in the nation. Or, should it?

You see the report also offers some hope. The report goes on to say more than three-quarters of consumers (78%) say shopping on mobile devices is still hindered by things like slow download times and screen size. Your brick and mortar does not have that issue...right? And your optimized retail website allows people to access YOU with a call or email...from the home screen...right?

Chrissy JensenAnd, the report has several other suggestions on how to stay relevant in this new retail economy: "Retailers should offer unique merchandise and seek out new ways to monetize the business."

Now, if you want a lesson in how to offer unique how to monetize your business to a broader audience go see my friend Chrissy (photo) at Domestica located in Des Moines East Village. In my mind she does this better than just about anybody. Honest...   

 

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New Horizons

I'm often struck at how fast we are moving forward. How, it seems, that each day something Speeding
new and fresh and exciting creates opportunity where not long ago there was none...or at least they were different

Step in the "Way-Back Machine" and consider what it was like ten years ago:

The sharing economy did not exist. Today we have companies like Airbnb, Lyft, Uber and others that have created a shift in how we market and sell services.

Television entertainment focused on cable, satellite or over the air transmission. Today consumers are cutting the cord at record numbers and watching on Netflix, Hulu and a host of other options.

Marijuana has emerged as not only a cash crop for Colorado but also coming is California and a host of other states and it's not only medical cannabis. This change has boosted another industry. Colorado is the number one state in the nation in promotional products. No, really.

And there is more..

Cars that navigate the roads on their own, electric vehicles that don't look like a battery (think Tesla), the rise of sustainability in products and services, podcasting where your business can create its own radio station, metrics that measure the success or failure of just about anything, relationship marketing through a host of social media tools...and that's just scratching the surface.

None of it was here just ten years ago.

So, what is next? We can speculate but the question you must ask yourself is this, "What have I done to better capture the realities of the new economy and match them with the consumer?"

What are your plans?

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It's About Relationships

Not long ago, on my daily business news broadcast, we had a story about how the Internet has  Car Sale Promotion
changed the way many buy their vehicle. It's not only that you can buy "on-line" but, more importantly, the consumer now has the same, or more, information about the vehicle than the car dealership.

That fact changes the dynamic greatly. Now, the purchase isn't so much about "best price" or "availability" but how the salesperson at the dealership builds a relationship with you the customer.  

No longer "hard data" it's now all about "soft skills".

This shift has happened across the business landscape. The power of knowledge is in the hands of the consumer in most instances. Now the focus, for salespeople everywhere, is about building long and lasting relationships. And, given the availability of social media, it is easier than ever to engage your existing and potential customers.  

Oh, and that hand-written note that's put in the mail with a real stamp...bet your customer will smile and keep it long after that shout out on Facebook.

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Why Knowing Trends Matters

We follow trends because it's important to understand where business is going rather than Closed Storewhere we've been. Not to say we should forget about our history but our eyes should always be on tomorrow so that business can adjust to the market. And we're not just talking about color schemes. We're talking about major shifts in consumers that drives marketing/advertising.

Home Depot is a case in point.

Last week, on the Business News Hour, we had a story about how Home Depot was changing their marketing mix away from the Do It Yourself person and focusing more on professional re-modelers and contractors. For a business that has built their brand on DIY this is a seismic shift.

Why?

Because the understand the trends in home-ownership. Consider:

  • Home-Ownership at an All Time Low: Only 63.5% of Americans own their home the lowest number since 1967;
  • DIY Gives Way to Do It For Me: As Baby Boomers age they are not as interested in tackling a kitchen or bathroom re-do and would rather hire it done;
  • Got No Skills: In many parts of the country "Shop Class" is a thing of the past. Shop was replaced by computer science and a generation didn't learn about building stuff;
  • More Renters: Blame it on the recession, stagnate wages, the desire to have fixed monthly expenses; whatever the reason more and more people are turning to rentals. Check the chart below.

Rise of RentersIt all adds up to a trend and Home Depot responded even though it meant moving away from what made them the best DIY store in the nation.

So, here are some questions for you:  Are you staying ahead of the trends? Are you paying attention? If sales are in a slump, or just not as robust as they once were, is it a trend away from your product or service? Do you know?

Maybe it's time to think about it...

Thanks for reading!

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Big Getting Little

Grocery store chains across the country are consolidating or simply calling HyVee Local Produce Two it quits. Last week legendary A&P filed for bankruptcy protection...for the second time. Kroger announced they are buying Harris Teeter and one of the oldest chains, Albertson's was swallowed up. Locally, family owned Dahls threw in the towel.

Today there are only a handful of regional grocery store chains in the nation. 

The grocery industry is vastly different today than just 10 years ago because there is more competition and the changing habits of consumers. Natural, local and fresh rate high on the expectation list of consumers. So, how does a regional chain compete against the likes of Whole Foods, Trader Joe's and others?

Bring on the LOCAL feel and flavor of a time gone by.


HyVee LocalA couple of years ago HyVee, a Midwest regional chain, had a pretty successful run at calling attention to locally sourced produce. (Photo at left and you can click to enlarge.) While it all worked the effort was small compared to what they've recently rolled out.

Here (above and to the right) is the new roll-out of how big can go little all in an effort to boost a little nostalgia while calling attention to the fact that they sell what comes from your neighbor. 

The entire "feel" of the brand says, "Hey, we remember what it was HyVee Local Produce Onelike...shop here for local produce!" And then they go to great lengths to tell you how "local".

We love the graphics, the look and the feel of the campaign.  Good stuff HyVee! 

Thanks for reading!

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