Establishing A Domain
Want a great name? Brand-building is the strategy behind the Web site of Domain Home Furnishings. The marketer of upscale and unique home furnishings created www.domain home.com to attract shoppers into stores (an idea that has also worked for www.radioshack.com). "It's very interactive, dynamic, exciting and accessible," says Laura Katz, Domain VP of merchandising and marketing. "It's not for online shopping." Instead the site serves as a no-pressure educator of well-healed customers. When they are ready to make a buying decision the site sends them to their nearest store. "We have a large number of subscriptions to our e-mail newsletter," she says, noting that it's a weekly loaded with decorating ideas. With help from vendor GERS Inc., (www.GERS.com) Domain maintains a database of 165,000 customers as to their behavior, demographics and other characteristics. The newsletter is customized. Sofa buyers get predominantly sofa information for instance.
The results have been rewarding. Web page hits have been high and have translated into high-dollar purchases, as tracked by coupon redemptions. And the newsletter gets a lot of attention, Katz reports. "We mail 20,000 newsletters, and those are viewed 40,000 times." In addition, Katz values multiple customer touch points: "Customers get our direct mailer, which looks like a magazine, they receive our e-mailed newsletter, and of course, we interact with them in our stores."
Charity Begins At POS
A&P and ShopRite are among the leading supermarket chains participating in a variety of food banks for the poor. In a typical program, customers can donate a minimum of $1 by pulling a coupon off a register display at the POS. Bar coding on the coupons tells A&P's Retek (www.retek.com) store database to pick off the donated dollars and deposit them in a special datamart for the charities. Thus the customer feels good even while paying the bill and word gets out that the supermarkets support local communities.
Teens Market Themselves
Hot Topic is a fashion chain growing at the rate of 70 stores a year. But it never buys an ad. What's the marketing plan? Friday night, buyers run out to concerts and catch glimpses of what the trend-setting teens are wearing. Within weeks, the products -- rock music-oriented and either licensed or unlicensed -- are on the shelf and product is turned over in as little as four weeks. Marketing is done by MTV, live concerts and other trend-setting events that are not sponsored by Hot Topic but are closely followed by the chain. Replenishment and inventory are managed by its JDA (www.jda.com) product.
Multi-channel marketing drives profits at Nine West Group, the shoe store chain that makes no distinction between bricks and clicks. "The goal is for every offer, every style to be redeemable and available both in stores and online," says Dianne Binford, director of consumer direct for Nine West Group. STS (www.nsbgroup.com) - an NSB company that provides CRM, merchandising, sales auditing and other e-business systems to retailers - is "central to the whole operation of this program," she says. STS is delivering registration, auditing and merchandising systems, as well as maintaining a customer database, so that all information in the brick-and-mortar channel stays in synch with data at the retailer's www.ninewest.com web site. STS also tracks online consumer behavior and conversion rates.
Nine West Group is additionally implementing multi-channel, one-time-use gift certificates. The certificates are being offered to store customers who sign up for the company's e-mail program. Once customers' e-mail addresses are registered, "We want to be able to e-mail gift certificates as perks to loyal customers," consumer direct leader Dianne Binford notes.
Instant Market Research
To increase its understanding of customers and to view the shopping experience through their eyes, RedEnvelope (www.redenvelope .com) turned to Vividence Corporation (www.vividence.com), a company that gathers qualitative feedback on customer perceptions, as well as information about where customers go on a Web site, and why. Vividence worked with RedEnvelope to help the e-tailer set priorities for site redesign and enhance the customer's shopping experience.
Today RedEnvelope's marketing strategy is to drive business to the company through its paper catalog, through e-mail campaigns and through online banner ads that promote www.redenvelope.com. Cunningham points out, "We want to integrate our channels. Most retailers have a different interaction online and through a catalog. We make it very easy and convenient to find and order catalog items at our Web site."
The end result, he says, is "it's easy to use the site, easy to relate it to the catalog, easy to order and easy to monitor the order once it's been placed." And this emphasis on customer convenience has helped put RedEnvelope in the black financially, for the company reported strong growth last holiday season.
Suddenly It's Summer
Rite Aid Pharmacies had a problem in the summer time. With over 3,000 stores across 30 states, the nation's number two pharmacist had trouble getting a handle on seasonal products. An early summer could kill revenues because of outages. A long summer could wreak havoc, especially if it stayed cool at the shore and warm in the city. Obviously, Rite Aid stores were not the only game in town for sun tan lotion, but the company wanted to market its summer first-aid capabilities. Rite Aid used JDA's E-3 product to manage inventory and saw improvements in availability. But they needed the cooperation of a sun products maker to get it right. Schering-Plough, maker of Coppertone and other summer health products also went with the JDA product and the two entered into a full CPFR program. Last summer, sales shot up in Rite Aid stores where special displays and advertising drove customers to a steadily and correctly replenished stock of products. And, says Rite Aid supply chain VP Paul Henko, the company had far fewer inventory shortages than in previous years. "Inventory is down from when we started the program," he says. With merchandising help, marketing gets stronger.
Domain, the upscale home furnishings chain can advertise to a select demographic or to a particular customer on the Web or in the stores. Malcolm Brazil, Domain's director of IS, says that the company has incorporated its GERS database with stores and the Web site. And this is part of the overall integration of GERS with all systems, "to enable us to serve the customer and provide valuable information about such things as order status and delivery schedulesvia interactions that happen 24 x 7, at the customer's convenience," says Laura Katz, VP of merchandising and marketing.
Store Circulars Online
They promise the retailer a three-figure savings each month. These store circulars are different for each of the stores owned by Utah-based Harmons. Made possible by the company's tightly integrated databases and Lotus Notes workflow, Harmons is able to run customized sales for each store.
We're not going to mention the chain we're talking about here. We don't need to. Simply by soaking the consumer consciousness with its logo in circulars, TV ads, the Web and in the stores, this discount retailer has managed to target customer attention without mentioning its name. "It's a great brand and symbol," says Jeff Roster, senior retail analyst with Gartner Dataquest. "And the symbol is on target because of positive associations and lively merchandising."
Hit the Target
Remke Markets in Cincinnati used Triversity's (www.triversity.com) integrated POS and store system software to build a hot CRM program that rewards frequent shoppers by using a Triversity database to target orders one on one to individual customers. As Bill Remke, CEO, puts it, "We like being able to use coupons to encourage non-customers to come in and buy at our stores." In fact, Remke sends out demographically targeted store circulars with coupons for customers with specific tastes. "For our direct-mail campaigns, we track how much money we spend, how often shoppers come back, how many customers we retain over time and what was the direct-mail campaign's return on investment," Remke adds.
Function Over Form
Jim Gilmore, a consultant and frequent conference superstar has emphasized the "experience" marketing as the best way to sell anything. On the Web, Gartner analyst Jeff Roster notes, good retail is "all about a good experience". We found that to be true at Bestbuy.com and at Lowes.com. Both are focused on the user experience, making it easy to find and access products as well as to buy them. On the Web, the best marketing for retailers is ease-of-use.
Personally In Person
Lots of retailers like to talk about personal service, but Remke supermarkets in Cincinnati really delivers. In fact CEO Bill Remke personally takes part in hand-delivering promotional gifts to the company's top 2000 customers every winter. The top customers are identified through the store's Triversity POS system.
Sold and Available
In Great Britain, store sales are posted in the store, which should mean that the retailer has a fighting chance of having enough inventory to back up the sale. That would be good marketing. For precisely this reason, Allders, the $800 million UK department store chain has adopted Retek 10 and its Advanced Retail Planning to make sure sales never backfire. We plan to reduce lost sales and markdowns," declares CIO John Tangaa.
Customer Satisfaction Push
Wild Oats Markets, which promotes healthy upscale food, has increased adjacencies both on the floor and in promotions. The idea is to heighten customer satisfaction with the company's overall marketing. Wild Oats has deployed Marketmax's (www.marketmax.com) best practice methodology to bring it off.
Electro Shelf-Tag Test
Imagine using electronic shelf tags that can be changed from hour to hour to reflect prices in special promotions. Binghamton, NY-based Giant Markets has NCR (www.ncr.com) electronic shelf tags in 12 supermarkets in upstate New York. The company went out of its way to involve customers in this program, surveying them regarding what information to display on the tags, asking them to evaluate tag readability and even hiring them to help with tag installation. A container of milk can be sold as a loss leader with super markdowns during the bargain hours of the day and can revert to convenience store pricing during the evening drive home. As a result average margins about double.
Machine Head Magnet
If you're in the music business, musicians will find you. But they also will find your competitors. The Guitar Center uses its Web site to draw musicians through educational and news presentations online. Hottest addition of them all is a connection device that allows musicians to submit samples of their own songs to publishing houses and distributors.
The Sports Authority has adopted JDA technology to help rationalize not only the inventory on hand for a circular, but the actual cost per item sold. Now the company can market more strategically and benchmark the sales to make sure they don't lose money without making a direct connection to actual sales.
A full range of retailers have tapped into a full range of kiosks to link to their promotional materials from circulars to ads. Boscov's uses kiosks to allow shoppers access to gift registry information. The hottest idea comes from Virgin Records stores which have a kiosk that allows the shopper to wave a bar-coded jewel box over a scanner and in turn play cuts from the CD inside the case.
United Supermarkets, a user of a wide variety of technologies including those supplied by Softechnics (www.soft echnics.com), has opened very large format ethnic grocery stores. Some stores focus on shoppers from Mexico. Others on shoppers from South America.
Marketing At Lands' End
Go to the Web site of Lands' End and you can build your own clothes. Customized clothing and cosmetics are the wave of the future, and from a marketing point of view, they are the ultimate in personalization.
Marketing is partly image and Trader Joe's www.traderjoes.com has perfected the art. Latest move on the Web: the company has discontinued the sale of duck meat because customers are concerned about the way the ducks are raised and slaughtered.
Sears has focused its advertising lately on the good life, at a great price. Guaranteed. Sears was among the first retailers to experiment with price optimization, tied to both the customer and supply chain databases.
Diamonds to Newcastle
Wal-Mart has used the industry's largest data warehouse (approaching 300 Terabytes at press time, according to insiders) to make a revolutionary discovery. It can build some stores in well-healed neighborhoods and target market to the rich. Home Depot is doing the same.
Fashion retailer Charlotte Russe is focused on winning in the narrow seasonal competition for clothing sales. To line up store activities with advertising, promotions and seasonality, the company's President and Chief Marketing Officer -- Harriet Sustarsic -- says she'll use the assortment planning and optimization tools in Marketmax's solution, allowing demand chain planning to power her marketing plan.