adidas: Bold Move

Everyone talks about it, but adidas actually did it. adidas (Runbase) Tokyo added lockers & showers to the retail mix, and offers trial merchandise for urban runners. How does that translate back to ROI? Maybe it won't in actual sales dollars, but it has to make an emotional connection with consumers. They've gone a step further toward really enabling consumers to participate in sport, using retail as the activity hub. It's bold. I'm happy to see what could be an evolution of the 3rd place concept.

Craftsman: Nails it

Craftsman is on to something. Their new experience door is more than just a manifestation of the DIY movement. It's like a shop-class for the urban dweller.

When I interviewed potential condo buyers in Seattle's South Lake Union district as to what was keeping them from purchasing and moving to a more urban location from the suburbs (which they all wanted to do), 90% mentioned something like a craft/hobby that they needed workspace for as the reason they stayed in more traditional homes.

Stagnating condo sales weren't due to the price of the units, the newness of the location, or any of the reasons the developer had thought of. These potential buyers had hobbies they didn't want to leave behind, but would have nowhere to pursue them in the pared down urban condos.

Craftsman has a great opportunity here to capitalize on this trend. People want to live in an urban environment, yet they need someplace to carry out their desire to make something. I'm excited to see if it takes off.

AA: I am impressed

Wow.

Just the right number of employees on a Saturday morning. Everyone with a clip board, taking inventory. Friendly employees. A few f*bombs dropped within earshot of consumers, but with good reason (I was eavesdropping). And OMG I was impressed.

- The perfect assortment to support an overall creative direction.

- A just-right selection of colors for every SKU.

- And the airtight organization / merchandising was really impressive.

Well done. Your well-organized merchandising smacks of classic Gap-ness, in a really small space - but with much more fun/sexy/interesting product.

Pull yourself out of financial crisis, Dov. You've got a good thing going. Don't blow it now!

A little inspiration: JJ Abrams

http://www.ted.com/talks/j_j_abrams_mystery_box.html

Hope the link works. GREAT talk!

Minority Report at Retail: Who will be first?

Gesture based interfaces are taking over electronics. In say, 3 years from now, there will be no more keyboards (and significantly less carpal tunnel syndrome).

Who will be the first to apply this technology at retail - in a mind-blowing, consumer-connecting, compelling (I can't peel my eyes off it) way? Ok, so that rules out Microsoft Surface. Who else?

Apple? Nike? EA? Virgin? Calling all innovators.... Guess we'll have to wait and see....

Microsoft Follow Up: OMG

This has nothing to do with retail, but it does validate what someone from Google or Apple (or both) once said, "Microsoft isn't evil.... they're just tasteless".

Watch the Bing video contest winner.

I'm dying to see their retail environment. It's a bit like waiting for the next Sarah Palin speech. You know it's going to be a train wreck, yet you can't pull your eyes away....

Microsoft Retail: Jumping the Shark

You know that moment. The moment when you know we've jumped the shark?

How many brands can try to copy Apple before that moment hits?

We've reached critical mass. We've hit the wall. We've jumped the shark.

I give you Microsoft Retail:

http://gizmodo.com/5322328//gallery/?selectedImage=

Consumer 3.0: Beta

I decided to just pull a Google and say my portrait of Consumer 3.0 is still in beta, while I gather more info to flesh out the picture. Thank you, Google, for making the first draft publishable. J

This new-ish consumer defies cohorts.

They don’t fit into any age bracket, because they consume based on values and interests – not stage of life.

They don’t shop big box, but for main staples like toilet paper, and for that they only make one monthly trip to the big box store.

They value niche, over mass-produced. To them MySpace is like Wal-Mart and Facebook is like Target. They’re searching for the niche social site that mirrors their values and interests. They have multiple profiles and accounts with social network sites and use them for different purposes.

They have multiple influencers from their family of origin – including birth parents and siblings, step-parents and siblings, miscellaneous temporary partners and siblings, and large extended and step families.

The younger ones grew up in a public school where they were either taught to or were forced to rely on peers for feedback, rather than the teacher.

The combination of the family structure and the school environment democratized power and authority to a large degree and contributed to a greater degree of ‘agency’ for this consumer.

This consumer defines leadership as "the person who can move the group forward" – not as the person with the most charisma, good looks, charm or status.

They value ‘doing’ over ‘having’. Because in the democratized group, what you are 'about' and what you 'do' matters more than what you have (either property or stature).

This consumer values authenticity, transparency, adaptability and sharing.

Examples of Consumer 3.0 [beta] companies include:

www.freitag.ch

www.icebreaker.com

www.muji.com

adidas: Hell Hath Frozen Over

Either that or profits are down 97%...

I was so stunned, I nearly tripped over myself the other day when I walked into an adidas Originals store and was GREETED by a smiling, friendly sales associate! Boy, that was a first. I'm usually ignored. That’s ok. No judgment here. Sometimes you have to hit rock bottom before you turn things around. Well done, adidas (if a bit late).

Trend: MicroTalents

Coining a new phrase today! MicroTalent. It’s the tiny little talent that you know you have, but there seems to be now place to leverage it. Alas... the web.

A few examples:

Panacea81 –My favorite. Hands down, the best example of a MicroTalent around. The ability to skillfully apply makeup, and some great eyes to go with. YouTube video. Huge following. And now, her own makeup line!! I love it!!!

iJustine – I can’t stop watching her. Something about her face is absolutely intriguing. It’s unconventional for ‘regular’ media, but absolutely perfect for her web enterprise. Go Justine!!

Perez Hilton – Where else would Perez have found employment, if not for his celebrity blog? US Magazine, perhaps, or OK! Magazine. He would have spent years trying to get in, and then years as an editorial grunt at any established publication. And why? When he has real ‘talent’. As it is, he sped right past them and went straight to the public. Let the public decide. If they don’t like it, they won’t read it. Democratization in action.

So how can you, as a marketer leverage this trend? Maybe think micro for a change. Turn over rocks. Look in the flower beds. Is there any kind of MicroTalent that your brand has? Brands don’t always have to be enablers of their consumers’ needs (zzzz). Just some food for thought.

Cheers!

Throw Down: American Apparel vs. Icebreaker

A few people wrote in to suggest that American Apparel was another example of a brand that lives its values and exemplifies them through its product and advertising as well as Icebreaker.

I thought about AA before I wrote the Icebreaker post – but there is a key difference between the two companies. Well, there are several, but I’ll start with this:

Ownership and leadership matter.  

(Take a close look at adidas' lingering brand problems, if you want to know why stable, consistent, ownership matters). As for leadership, every brand needs to be bigger than the personality of its leader/s.   

American Apparel is a cult of personality around founder and amateur photographer, Dov Charney. 

By contrast, Icebreaker founder, Jeremy Moon, tends to spread the credit for the company’s success among its many employees. He lets photographers do the photography and creative directors do the creative. In other words, he seems to be able to delegate, rather than dominate.  

The key issue here is - what happens to AA when Dov decides to leave his formative playground for another opportunity – or gets pushed out by a cranky board of directors? 

AA is a public company now. They’re not playing with tinker toys anymore. The minute Dov doesn't make his numbers for, oh, say 3 or 4 quarters in a row, his label as "shrewd marketer" will vaporize and be replaced by "business liability". And what would that do to the brand? It would be in jeopardy. A brand should be able to outlive its founders and should stand for something more than senior leadership’s personal flights of fancy. 

So, I hear your feedback, and do agree that the brand lives the values, but have to say Icebreaker definitely wins this throw down, because the company could totally survive and thrive without its founder at the helm - and that’s one key component of doing it right.

Love the feedback!! Keep the emails coming! 

Fresh Insight: 17 + Discerning

In a recent focus group I conducted, comprised of 14 - 18 y/o teens, the most popular social networks broke down like this:

MySpace

And I quote, "Eeeww"! "A pedophile's playground". "A place for Chesters" (It's always nice to have teenage boys in the room. They just cut right to the chase). They didn't like the brand image it has collected (rightly or wrongly), the user interface, the ads or the design. The only thing these teens used it for was to find new music on MySpace Music. 

Facebook

"It's Okay". "Static". "Slow". "An online photo album". They had profile pages, for sure, but found it a slow communication medium and were split 60/40 on their enjoyment of using it - skewing female.  

YouTube

An average of 10 hours a week on YouTube and no negative perception. For these teens, that meant approximately 5 hours on YouTube at home and 5 hours on YouTube at a friend's house or other location (most common: the public library). 

Twitter

Mixed reviews. Boys tended to find it annoying, girls tended to like it. Collectively, a quicker way to keep up with your friends than text messaging - a good way to get a status report out to a group - but still not sure how else to use it. 

Notable Finding:

The difference in perception of time spent on Facebook applications  vs. YouTube viewing was astounding. 

They had pretty negative feelings about Facebook gaming applications - meaning, they would get sucked into them, but felt like it was a "waste of their time", and they didn't walk away with a positive brand experience. Design applications where they could design something and share with friends, however, fared really well.    

YouTube netted almost no negative effect at all. None. These teens spent their time on YouTube mostly watching comedians and viral commercials from their favorite brands that they kept watching over and over - for sometimes up to 6 months. Say it with me, "R.O.I." 

Key Take-Aways:

Half an hour spent on a Facebook game = potential negative effect (unless you spin it just right). 

Half an hour spent watching YouTube = lift. 

Implications: 

Not all social networks are perceived equally in our 17 year old's discerning mind. You may want to: 

1. Consider the implications of associating your brand with MySpace.

2. Reconsider that Facebook application you've been so dilligently working on. Games might capture their attention, but may not net you positive feelings. Something they can create and share, is likely to fare much better.

3. Keep it clean on YouTube - they didn't want risqué (believe it or not, they do know how to get to the porn sites and ... gasp! ... lie about their age to get in), they wanted FUNNY. And often, they're watching in a public setting. 

4. Consider the gender differences with both Facebook and Twitter and develop your strategies for them accordingly.

Under Armour: "Big E"

I really try hard not to be snarky on this blog, but every once in a while I have to let loose... Is it just me, or does it look like "Big E", the Under Armour company mascot, just threw his back out in this store feature?!  Am I the only one who sees this?! 

Icebreaker: This is how it's done

For this post, I'm simply going to introduce you to Icebreaker - a new brand to me and to many of you. An introduction to the brand, at this point, is more important than critiquing their retail environment (merely one touchpoint of an entire brand experience). From here, I really encourage you to get to know Icebreaker yourself. They are a sparkling example of how to be authentic and seamless across all touchpoints.

Put simply: This is how it's done.

Raw Materials:
Icebreaker products are made from natural merino wool - not cotton or human-made fibers - with no more than 2-3% synthetic ingredients in them. It comes from an animal that is in no way harmed by the process of collecting the raw material.

Sourcing:
To keep a steady flow of the highest quality wool coming, Icebreaker negotiates 10-year contracts with farmers - cultivating a business practice they call "Narrow and Deep". This philosophy allows farmers to forecast and plan for the future (rather than keeping them guessing). In exchange, Icebreaker gets reliable access to the best merino wool available and builds lasting relationships with known, trusted partners.

Product:
Merino has some odd / unique qualities, certainly not found in cotton and often not found in synthetics:

- It warms you when its cold outside, and cools you when its warm - just like it does for the sheep.

- It doesn't collect sweat like cotton and synthetics - therefore it doesn't smell if you sweat in it, or wear it a few times between washings (just imagine all the implications that has!)

- Fewer washings means using less natural resources (water)

When I asked Russ Hopcus, president of Icebreaker US, about the product's performance in rain, he said, "We're not waterproof. We looked at what it would take to make the products waterproof and we knew we'd have to add more synthetic fiber to the fabric. We decided it didn't fit with our philosophy. Besides, it's ok to get an Icebreaker wet - the natural characteristics of the merino will keep you warm"! I love it!! I'll throw on a waterproof jacket, if I have to, but my Icebreaker doesn't have to be all things to all people, if it compromises the integrity of the garment.

Transparency:
You can track the product all the way back to its source using an SKU tracking system they call BAACODE. You find the ID number on the garment and enter it into the website, and you can actually track the product all the way back to the farmer responsible for producing the wool. So... why can't I do that with my Jack Purcell's? No really... why? What's holding companies back?

Creative:
Icebreaker has produced creative that beautifully captures the essence of the brand - they need to print a coffee table book of the photography!

- My litmus test for creative is always this: It has to be so much YOU that it couldn't possibly belong to anyone else. The Nike swoosh is that. The adidas Trefoil is that. Not sure the new Pepsi logo can meet that test, but you get the picture.

- What Icebreaker has is an entire seamless suite of visuals and stories, and a way of telling the story, that couldn't possibly belong to anyone else (any other brand). Honestly, I can't think of another brand I could say that about right now.

Marketing:
Ever so subtly, Icebreaker engages in tactics that support their overall philosophy. No shouting. Not even any vitriolic 'green messaging' (whew). 

- They'll plant a tree for you, if you sign up for their email list. Here's the address, go do it right now! http://www.icebreaker.com/site/mailing_list_signup.html

- They run a promotion with many of their retail partners called "everyday challenge", where they challenge each of the store employees to wear the same Icebreaker top for the entire month... without washing... and it won't stink!

- They use a ton of video on their site to tell their stories - an inspiring trip to India, a trip to Brazil, interviews with farmers, and so on. Lots of transparency!

Sales:
This is a company poised to meet the needs of Consumer 3.0, as evidenced by their growth - business has tripled since 2005.

They make it seem effortless, though I'm sure it's not. I really encourage you to experience this brand for yourself.

This is authenticity. This is seamless. This is transparency. This is sustainability. This is how it's done.

Method: Mine, not the Soap

A word about my method:

1. When a brand or a retail environment catches my eye - I begin to investigate.

2. I read through the company's annual report (if they have one) and listen in on earnings calls, speeches and whatever else is available. I track topline sales, margin, profit, future orders and market share for the brands I cover on a regular basis. I also scan for tone, trends, any new product or retail rollouts coming up and general outlook of the company.

3. I interview people from the company and consumers, when possible.

4. I visit as many stores, in as many locations as I can, to observe, for a few reasons:

-- Patterns will emerge and it's possible to re-engineer processes and values the company has.
-- It allows me to determine if patterns, events, and issues are local, individual occurrences, or
company-wide and systemic.

5. I'd like to write more about retail design trends, but that gets expensive, given the way I do this.

6. My experience taxonomy includes these elements, and when I audit a store, these are the categories I'm looking at:

-- Outside: Location, architecture, positioning (in a mall)
-- Inside: Interior architecture, fixtures, layout, major features
-- Operations: Registers, technology, processes
-- Product: Product offering, attributes, unique features
-- Merchandising: Presentation
-- In-Store Communication: Visual Storytelling
-- Sales Process: The 7ish step process of interaction between associates and consumers
-- Overall Experience: The collective experience with that brand at the retail touchpoint

7. And finally, when I make a post, I stand by it. I don't think I'll ever take one down, but I'd allow myself that out, if information surfaced that contradicted what I'd written. But I do edit for typos, format and wording, after I've posted.

8. I don't let people comment directly on the blog, because I'm vain and don't want to junk up the design! But if you ever have questions, comments, or feedback, you're absolutely welcome to email me!

Cheers! And thanks for reading.

Elle

1989: Year of the Third Place

20 years!

Can you believe it's been 20 years since urban sociologist Ray Oldenburg first coined the phrase and concept, The Third Place?! No one did it better than Starbucks.

Fast forward to 2009, and it's a very different world. We're densely networked, and people have many, many, many places to congregate - both virtual and physical.

How does that change the retail experience? It's no longer about creating a 3rd place, but what is it about?

I propose this: If information was the cultural currency of the first part of this decade, then inspiration is the cultural currency of right now - and the Third Place is dead. Your job, then, is to inspire.

China: Pop Quiz

Quick!

Name three original Chinese brands!

Time's up! What are they?

Could you think of any? Me either.

This is why I say that the emerging story of Li Ning is nothing less than the biggest category sell of all time.

They're not just selling sport or fashion. They're selling authentic 'China' to the rest of the world.

And how very interesting that the first major, home-grown, consumer brand to come out of China is a sports brand. Not electronics or cars or a telecom something-or-other (thank god... yawn).

But of course, this is the biggest challenge for Li Ning. Authenticity.

Coming from a culture of collective thinking, and an economy built on making products for other companies, finding oneself as a brand will be no small challenge. But that's precisely where the opportunity lies. None of us want to buy a mash-up of Nike and adidas.

People want true authenticity - however that manifests.

It will be cool to watch them evolve and find themselves as a brand.

Now... about that logo...

Nike Declares: Game On

Nike has thrown down the gauntlet!

With an unmistakable endorsement for the 'consumer-interaction-at-retail' movement, and a hefty investment in the 'creative generation', Nike has rolled out its new concept store in several locations, Q4 '08.

The store layout includes 2 design stations, one for shoes and one for t-shirts, and a third area with computers to look up information. Just eyeballing, it looks to take up about 1/3 of the total square footage. Like I said, a hefty investment.

The questions are: Will this model work for anyone other than Apple? Will the 'creative generation' step up and actually use these features? Can, and do we need to recognize ROI from these initiatives? Time will tell. Until then...

Game on!

ROI: Some posts are worth re-visiting

ROI is your ally in this economic climate... but how to demonstrate it, that is the question.

You’ll need three things:
-- Quantitative Data
-- Qualitative Data
-- A Dashboard – put the Xanax away. You can totally do this.

You need the quantitative data for the literal truth. But as they say in literature, there is the literal truth, and there is a poetic truth -- and you need that too, in order to really tell your story. That's where the qualitative data come in. The dashboard you'll build, if you don't have an analyst to do it for you, is your tool for telling a compelling story to senior management.

Quantitative Examples:
-- Traffic Counters
-- Conversion and Sales Data
-- EM, DM, MM, Twitter

• Email, Direct Mail, Mobile Marketing and Twitter drive traffic and let you get offer-specific so you can follow the trail right to the sales data - which will tell you part of the story.
  
• Best direct mail program out there right now: Nimblefish.
• Best Twitter dashboard and management program: HootSuite.
  

Qualitative Examples:
-- Organic Feedback

• What are the customers saying? You can't get that from a traffic counter or sales data. It’s the “why” behind the data.
  
• Build relationships with a few on-the-ground associates you can contact to get an organic read on how successful your programs are. It's anecdotal, yes, and associates will suffer from the halo effect (remembering the most recent incidents the best, thus tainting their perspective), so you'll need to contact them as soon as the campaign hits. But it's insightful, if not critical feedback, straight from the front lines. Incorporate it into your presentation and it will help you tell a more robust story that response rates, traffic counters and sales data alone can’t tell.
  

Dashboard:
If you don't have an analyst to make sense of data streaming in from the retail front for you, it's time to get comfortable with it yourself. You'll want a dashboard, and you absolutely CAN create one. Try Tableau Software. It's the easiest, and best dashboard software out there. With a basic understanding of Excel, and the stats class you took in college, you can totally do this.

You will be a rock star when you can demonstrate ROI to management - using quantitative and qualitative measures, in visual storytelling format.

Love: Beats Anthropologie

And that ain't easy!!

Perhaps the best store window since... well... the last Anthropologie one. I just like how it captures, in such a simple, yet utterly beautiful way, the pulse of society right now. Nicely done!

Ignore the data: Don't hide the accessories

Despite supporting data from retail research firms suggesting that the best way to merchandise accessories is to integrate them with the outfits they coordinate with - it's simply not the best thing to do right now.

While normally accessories are meant to be an add-on to bump up the overall purchase price, right now they may be the only purchase. Whatever you do, don't make them hard to find!

Levis needs to do a quick update to their accessory merchandising strategy. Tucking scarves into baskets and stashing them near the outfits they coordinate with would normally be a sound tactic. But right now, they need to be out where customers can easily find them, try them on, and head to the register with them before they decide they don't need it.

Anthropologie does a great job of placing most of their accessories in one location - strategically in line-of-sight from the door (for easy spotting) and near the registers (for quick purchase).

Nike: Is flirting with you

Now, if that's not the most attractive recycling bin I've ever seen, then I don't know what is. I think it winked at me when I walked by!

In an era of green fatigue, Nike decided to flirt with its consumers about recycling, rather than beat them over the head with it. Thank you! Consumers already know they need to live green, and they do, for the most part. All you need to do is entice them into being green in partnership with you, as this recycling bin does.

Fixture was designed by TwentyFour7 .

Well done guys!

And here's an example of a well-intentioned, yet utterly uninspiring recycling bin:

China: Catch me if you can

For the next few posts (and they probably won’t be consecutive), we’re going to take a look at Li Ning, the unexpectedly charming brand emerging from China, with an unwritten future ahead of it.

With only an estimated 9% market share on its home turf, one might be tempted to write it off as somewhat successful, but regional at best. One could say… the Under Armour of China. Or deploy that ultimate diss of the urban elite and the already-established… Provincial.

Certainly, they have some work to do, but they also have lots of opportunity ahead of them. I invite you to take another look.

I examine retail environments in this blog from a branding perspective, and that means we have to have a good understanding of the brand before we can critique the retail environment as it relates to the brand. So, we’ll take it from the top with Li Ning. The name: How to pronounce it?

Li is said quickly and is kind of clipped at the end, so that it almost sounds like ‘lit’. Ning is said a little slower, but not by much. You toss that out nonchalantly, as if everybody knows what you’re referring to. It’s not pronounced with the flat footed Leeee Nnnning we tend to give it in the U.S., as if we’re struggling to get it off the tongue. They’re not having any trouble. It’s said quickly. It’s said crisply. It’s disarming. And it’s utterly charming.

Stay tuned…

adidas: Can I get a what, what?

No! It can’t be. Cardboard boxes cluttering up the visual experience in a showcase store of one of my favorite worldwide brands?!

Indeed it was. And not just at the Chicago location, where this photo was taken.

I did a little sleuthing and used the taxonomy I created to review the adidas retail experience at 7 locations, spanning 3 countries and two continents.

What I found was a company that knows its target audience well. Stores are located in prime urban positions, have product that personifies the brand, a distinctive aesthetic, and they’re merchandising with remarkable consistency across the board. But they have systemic cosmetic issues that need attending and they have some fine tuning to do on their engagement experience - both of which could have a positive impact on revenue, if addressed.

Operations:

I love that the store employees had the creativity and initiative to make their own price signs (perhaps they weren’t supplied by corporate), but what they really should have spent their time doing was dusting the display case and leave the signage to corporate.

Accessories:

I’m not seeing a comprehensive accessories strategy befitting a global brand here. What seems to be an after-thought could easily be a profit center – with a clear strategy and the product and merchandising to back it up.

Lighting:

Track lighting and floor lamps may be a temporary solution in Vancouver, where it’s often foggy (and dark), but a more sustainable lighting solution that’s in keeping with the aesthetic is needed here.

Experience:

And here’s where it gets a little dicey… and where there's the most opportunity to impact revenue.

I stood in the London performance store for 20 minutes watching women come up the escalator, walk straight to the Stella McCartney rack (and I mean straight to it – at a breakneck pace), pick through the clothes, stare at them quizzically, then put them back on the rack and walk out. Meanwhile, a store associate was close by, getting out new stock from a box and putting it away without offering to assist the customers.

This was a common sight throughout my journey. Store associates stock merchandise during the day and prioritize it over interacting with customers – in every store I visited. Maybe they’re not supposed to… but they do, consistently.

That part of the experience would be one of my top priorities in 2009, if I were adi.

In fact, I’m calling it right now. I say, that if they stocked merchandise before opening or after closing (like we used to do at Nordstrom back in the day), and crafted a unique interaction to have with consumers during open store hours – not high pressure, just a light, but attentive interaction – they’d see an increase in same-store sales by >2% over the year. And who couldn’t use that in this economy?!

Somebody bet me! I’m feeling lucky. :)

Blame Canada: Lululemon

Lululemon has handily achieved what many brands are trying so hard to achieve right now - community at the retail touchpoint.

I've been skeptical that this idea of 'community' at the retail touchpoint would work, but walk past a Lululemon storefront on any given night, and you'll see a steady stream of consumers - after hours - meeting up to go running, take a yoga class, or engage in some other exercise class in the store. No big screen TVs. No Internet access. No food, even! Just people. Doing exactly what you want them to do: Interact. Linger. Participate. Incorporate the brand into their lives. How'd they succeed where others have failed? Blame Canada. :)