Wednesday, October 28, 2015

Open or Closed On Thanksgiving and Black Friday?

Bucking the retail trend, REI is purposely closing on Black Friday, the day after Thanksgiving that traditionally serves as the kickoff to serious holiday shopping. Above is its announcement, shown on its home page.

Other retailers are resisting the competitive urge to open on Thanksgiving. In some years, the trend toward store openings on Thanksgiving sparked a bit of a consumer backlash, but online retailers recognize that shopping takes place any time, anywhere, and that's what store retailers are up against.

As of October 28, here are some of the highlights of who's doing what on Thanksgiving and Black Friday.
  • REI has announced it will not only be closed for Black Friday, it wants to encourage customers and employees to enjoy nature with its #OptOutside campaign. An REI exec explains: "This is a unique moment to extend that period of thanks and really be thankful for all that the outdoor world gives to us." You can see the CEO talking about this decision here. Oh, and REI's employees will be paid for Black Friday.
  • Costco, Nordstrom, and TJ Maxx will remain closed on Thanksgiving but will welcome shoppers on Black Friday. 
  • Staples was open on some previous Thanksgivings but not this year. Black Friday (starting at 6 am) is time enough to pick up a new printer or toner cartridge or whatever.
  • GameStop is closed on Thanksgiving. But if you want to line up for Black Friday specials, the doors open at 5 am on Friday.
  • Dollar General will open at 7 am on Thanksgiving (and, for the holiday, close 2 hours earlier than usual).
Will REI's new movement encourage consumers to change their behavior on one of the busiest shopping days of the year? Maybe not, but #OptOutside is a fresh message and puts a halo around the brand to boot.

Tuesday, October 27, 2015

Robots in the Warehouse

Robots have been in warehouses for some years--but what's new is how robots are streamlining physical distribution and speeding customer order delivery by participating in the Internet of Things.

As shown above, robots are working side-by-side with Amazon employees to handle heavy, tedious, repetitive tasks. MIT Technology Review calls this human-robot symbiosis. Here's how that works at Amazon: "To encourage workers to see robots as companions, each unit is given a different name by an Amazon employee, and the name is entered into the system, so workstation workers can refer to them by name instead of a serial number."

Amazon recently awarded cash prizes for robots that (on their own) can read customer orders, gather and pack the merchandise, and have everything ready for shipment. Given the company's huge throughput and seasonal peaks, warehouse automation is needed to supplement traditional employee activities. That's one reason why Amazon acquired Kiva Systems in 2012 and renamed it Amazon Robotics.

Here's the vision of Amazon Robotics:
Amazon Robotics automates fulfilment center operations using various methods of robotic technology including autonomous mobile robots, sophisticated control software, language perception, power management, computer vision, depth sensing, machine learning, object recognition, and semantic understanding of commands.
Amazon isn't the only firm working on robots to collect orders and send them on their way. Fetch Robotics makes robots that carry bins and help warehouse workers retrieve merchandise to complete customer orders. Once a bin is filled, that robot peels away and another rolls up to continue helping the worker.

Clearpath Robotics is another firm marketing robots. It originally developed robots for dirty, dangerous jobs like mining. Now it has robots for warehouse use. An executive explains: "Our robots operate in collaboration with what human beings are already doing, meaning you can implement them within operations in facilities that already exist."

With customer satisfaction as the ultimate priority, what's next for robots in the warehouse? And how will businesses tighten tech security as the Internet of Things expands into more domains?

Friday, October 23, 2015

McDonald's Starts Its Turnaround

McDonald's reported good quarterly earnings for a change. Competition from other casual dining chains has been a problem. Also helping the turnaround: new menu items and revamped favorites with quality ingredients (like using butter in the Egg McMuffin instead of non-butter). Not to mention that McDonald's also figured out (finally) how to meet demand for all-day breakfast (promoted with #AllDayBreakfast)--results that should show up in the next earnings report.

The venerable burger chain is testing "customizable burgers" in particular locations--and also testing sweet potato fries and Monster energy drinks. The Value Menu (needed during the recent recession) could very well be the next revamp. Meanwhile, with ethical sourcing and sustainability on the menu, McDonald's is moving toward using only eggs from cage-free chickens little by little in the US and Canada.

For smartphone users, the McDonald's app provides directions to the nearest location and, of course, weekly specials.

Thursday, October 15, 2015

How Brands Stand the Test of Time

Visiting a historical society near the Ohio headquarters of Procter & Gamble, I noticed this wooden crate that once held 100 "cakes" (bars) of Ivory soap. Since the Ivory brand is more than a century old, it's hard to know when this label art was in use. But Ivory still embraces the image and personality of its early days. If you click to the Ivory Tumblr page, you'll see the brand's intro:
This isn’t your grandmother’s soap. This is your great-great-grandmother’s soap! For 130 years, we’ve brought simple, effective cleaning products to families everywhere. If it’s good enough for your Nana, it’s good enough for you.
How does a brand stand the test of time? Year in and year out, Ivory stays true to its brand roots while updating the way it reaches out to customers. For instance, Ivory's Facebook page has more than 50k likes. P&G Canada's Ivory web page includes a detailed history of how the soap was developed, starting in 1878.

Distribution is critical, and Ivory is represented in hundreds of thousands of grocery outlets all over the planet. However, Ivory's market share has been moving lower as consumers shift their buying behavior to body washes and liquid soaps and also try specialized personal cleansing products.

Will P&G sell Ivory as it reduces its brand portfolio? Even if it does, Ivory should be able to maintain a core customer base who believe in the brand and its benefits.

Monday, October 12, 2015

Behind the Ban on Plastic Bags

Environmental concerns have been driving more municipalities, states, and even some nations to ban those lightweight one-use plastic bags given away free to store shoppers. As noted by the National Conference of State Legislatures, "Regulating bags can mitigate harmful impacts to oceans, rivers, lakes and the wildlife that inhabit them. Reducing bag use can also relieve pressure on landfills and waste management." On the other hand, the New Scientist notes that these plastic bags are only a tiny part of the waste stream and unlikely to make a dramatic impact on the environment, saying: "Reducing use of plastic bags has a far greater social than environmental benefit."

With an eye toward cleaner streets, streams, and landfills, Denmark didn't ban the bags; instead, it began taxing them in 1994. Not surprisingly, Danish residents now use only four bags per year. 

The city of Austin, TX banned these lightweight bags and did find a decrease in such bags discarded in landfills. However, Austin also discovered an unintended consequence: people are now throwing away reusable plastic bags at a higher rate, and those bags take up nearly as much more space in landfills as the lightweight freebie bags.

Now Great Britain is forcing stores to charge for disposable plastic bags (5 pence each) to discourage their widespread use. Stores are being encouraged to give the money to charity, and the charge (which translates to about 8 cents per bag) is expected to influence consumer behavior to reduce the number of plastic bags being used and thrown away.

Some areas of the U.S. (including Portland, Maine) have retailers charging a nickel for each single-use bag. And in Portland, the use of reusable bags for shopping has increased, showing that consumer behavior can be shaped by a nickel here and a nickel there.

Meanwhile, a movement is growing to ban the bans. A California law to ban the bags has been delayed--and now the issue will go to voters in 2016 in the form of a statewide referendum. Will California ban or keep the bags? These environmental, political, and legislative concerns will have an effect on retail marketers, bag manufacturers, and the behavior and pocketbooks of consumers.

Saturday, October 10, 2015

Marketing Pumpkin Everything in Autumn

Despite the great pumpkin shortage of 2015, autumn is the time when pumpkin invades the food world. In 2003, Starbucks and its marketing muscle helped launch this now annual fad of pumpkin-inspired beverages, desserts, and other foods of the season.

The marketing approach involves generating excitement for a flavor that many love but only offering products with pumpkin for a limited time. In other words: "Hurry and buy before it's gone and you have to wait another year."

And it works: According to the NPD Group, the average transaction for a purchase involving pumpkin-seasonal food/beverage is higher than without the pumpkin. This is a powerful profit reason for many marketers to jump on the pumpkin bandwagon.

A few samples of pumpkin marketing this fall:
  • Starbucks is adding real pumpkin to its Pumpkin Spice Latte, the original seasonal favorite that kicked off the pumpkin craze. 
  • Pumpkin Ale is a seasonal specialty at Saint Louis Brewery and at a growing number of other breweries, including Colorado's Upslope Brewing.
  • Dunkin' Donuts has gone wild with pumpkin for its 65th anniversary, offering donuts, coffees, and much more.
  • M&Ms now come in a seasonal pumpkin spice latte flavor.
  • Quaker Oatmeal has a seasonal pumpkin flavor too.

Tuesday, October 6, 2015

Airport Kiosk Closeup: Benefit

Hopkins International Airport in Cleveland is home to a cute cosmetics kiosk from Benefit, based in San Francisco. The kiosk is eye-catching because it's pink, retro, and markets its beauty products with a touch of humor. In fact, retro whimsy is integrated into the brand personality (as is the color pink)--even throughout the company's HQ. For differentiation and image purposes, sometimes it helps to not take your brand too seriously--a marketing approach that appeals to certain customer segments.

Here's the kiosk's appeal: If you're running for a plane but need to refill your beauty bag or you forgot a staple item such as mascara or face cleanser, just watch for Benefits' "Glam Up & Away" automated beauty kiosk "loaded with jet-setting beauty problem solvers" in Cleveland, Baltimore/Washington Intl Airport, Logan Airport in Boston, and other gateways for jet-setters. A touch on the screen, one swipe of your plastic, and you're on your way with what you need.

Benefit does distribute via traditional retail establishments like Macy's and Sephora, of course, but the nearly 40-year-old company (now part of the luxury marketer LVMH) also operates dozens of its own-brand stores in the US and internationally.

Thursday, October 1, 2015

Single-Serve Pods Beyond Coffee

Keurig Kold
Keurig Green Mountain has just introduced a new product, the Keurig KOLD Drinkmaker - a machine for making ice-cold sodas and other chilled beverages, one serving at a time, at home.

Why? Now that K-cup coffeemakers are ubiquitous (meaning in the maturity stage of the product life-cycle), marketers are looking to take single-serve pods beyond coffee. This would extend the life-cycle and also attract new customers (such as those who aren't coffee fans, for instance). This is also in line with the trend toward at-home beverage makers like the SodaStream.
Keurig estimates its US market share of single-serve coffee-makers at 17%. By targeting the chilled soft-drink market, the company can reach a new audience and increase penetration. The KOLD machine is a stand-alone product, although Keurig is working on one machine that can produce both hot and cold drinks.

"It's a premium, it's about choice and convenience," explains Keurig's CEO about the 90-second process, which chills the beverage as it carbonates and adds flavor. Among the first sodas to be dispensed through the KOLD are Coca-Cola, Dr Pepper, and Sprite. Instead of having to store bottles or cans of soda, KOLD customers can make a fresh glass of the flavor of their choice.

Will KOLD find a large audience?