Friday, April 21, 2017

What's Next for Legacy Retailing?

Stores have been closing as the full impact of consumer behavior shifts is felt by legacy retailers from coast to coast. The head of Urban Outfitters notes: "The U.S. market is oversaturated with retail space and far too much of that space is occupied by stores selling apparel."

Of course, this "over-storing of America" theme is nothing new: legacy retailing has been grappling with so many stores and so many malls for decades--literally. By one account, the number of shopping malls increased twice as fast as population growth between 1970 and 2015.

Lots of malls means lots of stores--yet with the ascendancy of online and mobile shopping, how many stores do legacy retailers really need?

The over-stored phenomenon and shifts in buyer behavior are leading to "zombie malls" and retail bankruptcies. Wet Seal is only one of many retailers to close its doors in 2017 alone. Some retailers are trying to reorganize as smaller chains. Is that how legacy retailing will survive?

Meanwhile, Walmart is buying smaller online businesses like ModCloth in a bid to attract their shoppers and broaden beyond its legacy customer base. Is that how legacy retailing will survive?



Monday, April 17, 2017

How Not to Handle a PR Crisis

Right now, if you do an online search for "United Airlines crisis," more than 1 million results pop up.

That's an indication of how serious a PR crisis United Airlines is facing after forcibly removing a passenger from one of its jets to make room for crew.

The flight from Chicago was fully booked and even offering up to $1,000 in vouchers for future flights didn't bring anyone forward to volunteer. Airline employees said they would have to randomly select passengers to leave the plane.

Three passengers reluctantly agreed when they were asked to leave their seats to make way for United crew members. One refused. And so United's employees brought in the aviation police to forcibly remove the passenger. Things did not go well.

Others on the plane began to video the encounter and post to social media. Soon the entire planet could see how this passenger was being forcibly dragged through the aisle, his face bloody and his body limp. Millions of people viewed and reposted the videos. Many news media posted the videos and their comments. Social media memes popped up in the wake of the incident.

How did United react? Well, despite its stated commitment to customer service (see top), the airline simply didn't do a good job here.

Its CEO didn't know how or when to apologize and try to make things right. At first, he talked about "re-accommodating" the passengers--and that phrase was, of course, widely ridiculed. He then blamed the passenger for being belligerent, which not only contradicted the videos but also made the customer the bad guy in this situation. Wrong.

Finally, the CEO began issuing apologies and saying that all passengers on the plane would receive refunds. By then, United's stock had dropped and even competitors were taking some jabs at the company.

Now all of this is on top of the famous #UnitedBreaksGuitars video, when a musician couldn't get United to pay for a guitar it broke. He wrote a song, did a video, and posted it online. Yes, the hashtag and video went viral. United got the message.

Once again, United Airlines is in the midst of a PR crisis.

Tuesday, April 11, 2017

Marketing Paints Named with Emotional and Experiential Appeal in Mind

White isn't just white in the marketing world of paint. As Consumer Reports notes, it can be "Simply White" or "White Dove" (both Benjamin Moore). Taupe isn't just taupe--SherwinWilliams says that "Poised Taupe" is its color of 2017 (see above).

In the May issue of Consumer Reports, the color marketing manager for Behr explains how that brand's paint names work: "Names can typically be sorted into four descriptive categories: visual, geographical, emotional, and experiential."

In fact Behr's website presents "Color Trends and Inspiration," where you can see its 2017 trends organized according to three categories: Comfortable (muted), Composed, and Confident (more adventurous).

Behr's Instgram account has nearly 30k followers examining its many paint and decorating idea photos, covering all the rooms in the house and the outside too.

Benjamin Moore has 122k Instagram followers and uses the hashtag #PaintLikeNoOther to identify its creative and colorful idea images for consumers to consider and enjoy.

SherwinWilliams has nearly 76k Instagram followers and uses #SWColorLove to identify its images that inspire and encourage consumers to express themselves with color.

One last thought about color: It seems that consumers tend to prefer paints with fanciful names, such as "mocha" instead of "brown," as more pleasing to the eye. Then there's the sheer marketing appeal of paints with personality-plus names. Why market "white" when you can market "White Dove," for example?

Tuesday, April 4, 2017

Procter and Gamble Grows in Services

Brands that are successful for products can sometimes be stretched into the service sector. That's what happened when P&G bought Dallas's University Laundry, a service that picks up dirty laundry and delivers clean clothes on the campus of 23 universities.

One of University Laundry's marketing appeals is the potential for built-in repeat business. Students, the target market, get accustomed to the convenience of easy drop-ff and pickup, no waiting in line for washers and dryers, no folding. Also, University Laundry has a "local" feel, taking a local name for its services on each campus. Finally, arrangements are on demand via app, although a toll-free number is available for conversations (a nod to differing consumer behavior and expectation situations).

Now the firm is part of Tide Laundry Services. Tide, a P&G detergent brand you might have heard of? P&G tried Tide laundry services a while back, shelved the idea, and brought it back in a test last year. University Laundry fits into this service pattern of wash-dry-fold and app for convenience.

P&G also operates professional laundry services on site for organizations or institutions. One of its customers is the NFL. Yes, P&G has the scale to handle laundry for football teams, under the Tide brand.

The well-known, well-respected Tide brand is certainly a good fit with this service business. But what are the long-term growth and profit possibilities?