Archive for September, 2009

The Courage to Let Go

Wednesday, September 30th, 2009

Recently I was invited to speak to a group of senior executives at a well established national retail company.  It’s a business steeped in tradition and admired for its values and commitment to its stores and its employees.   They admit however that proactive change is not something they’re widely reputed for.  Based on the fact that I am such an advocate of change, I didn’t know exactly what to expect going in.HANDS3

My presentation centered on how the needs of consumers, the nature of competition and the media are all shifting dramatically.  I discussed the many opportunities that are available to companies who embrace change and how they can capitalize on it.   A substantial part of the presentation focuses on the continued growth and importance of social networks and media for retailers.

At the end of the presentation I spoke to their Marketing Director who had been trying for months to implement a social media program.  He was clearly and understandably delighted to learn he had just gotten the CEO’s approval to finally go ahead with it. He thanked me and I congratulated him and told him that I admired his conviction. It takes courage to fight for what we believe in.

However, as I made my way out of the conference room I realized that the real courage that day was on the part of the company’s CEO.   Until now, he had, for whatever reason, been opposed to a social media program but today he allowed his position to change.  Sure it takes guts to stand up for what you believe in, but I think it takes even more courage to let go of what you believe in.   Divorcing yourself from a long-held belief is like throwing out your favorite pair of jeans – they may be a little dated and worn but they’re damn comfortable…far more comfortable than new ones.

Organizations rarely fail to adapt because their people didn’t realize the need for change.  On the contrary, it’s often the rank and file employees that are the most vocal proponents for change.  Ironically, it’s often because their leaders simply won’t let go of the past.  Consequently, they impede the organization’s ability to change.  It seems almost counterintuitive that leadership would stand in the way of progress but it’s often the case.  Change can be turbulent, chaotic and uncertain – three things many CEO’s (and the shareholders they answer to) don’t care for very much.

Strangely enough, the barrier to change isn’t a lack of people sticking to their guns.  It’s an overabundance of people sticking to their guns.  Yes, it takes courage to hold-on in the face of adversity but I maintain that it takes more courage to let go in the face of change.

Tags: , ,
Posted in The Future

A Bold Step into the Future for the PDRA

Friday, September 25th, 2009

We’re happy to announce that the Paint and Decorating Retailers Association of North America has engaged Retail Prophet to develop the organizations first-ever social media program.PDRA

The PDRA, headquartered in St. Louis, MO is an association dedicated to the support and education of its members across the U.S. and Canada. Founded in 1947, the association brings value to its membership through trade shows, training programs and publication of its magazine, Paint and Decorating Retailer.

An effective social media program will extend both the reach and frequency of the PDRA’s message, enabling even greater levels of support and dialogue with it’s membership and the industry at large.

Posted in Client Stories

It’s A Numbers Game: An Inteview with Ken Gronbach

Monday, September 21st, 2009

By Doug Stephens

“…there’s a parade moving through our marketplace.  But instead of marching, the parade is aging.  Those at the front – the oldest – are already disbanding, while the youngest in the back of the parade are just now forming at the fairgrounds.  The parade has a pace of its own and we can’t slow it down, speed it up or change the order of each section.

The generational sections vary dramatically in size.  This fact makes their consumption habits very predictable.”

-          From The Age Curve:  How to Profit From the Coming Demographic Storm

There has been endless speculation over the last decade about the aging consumer and the profound impact they will have on almost every aspect of the economy.  More recently, attention has turned to their heirs to the throne of consumerism, Generation Y and the game-changing influence they’ll have on all categories of goods and services.

The Age Curve Author, Ken Gronbach

The Age Curve author, Ken Gronbach

Despite all the conversation, do marketers really get it? Are they truly paying attention to these profound and largely mathematical realities?  Are they aptly identifying key differences between generations? If they are what are some of the common pitfalls and misconceptions they risk running up against in putting demographics into practice in their marketing approach?

I had a chance this week to interview Ken Gronbach, author of The Age Curve and ask his opinion on some of these questions.

Retail Prophet: What do you feel is the greatest misconception surrounding the use of demographic information by marketers?

K.G.: The major problem marketers have with demographics is comparing apples and oranges. A generation is twenty years long, roughly the time between birth and regeneration.   Most marketers get the Boomer generation (born 1945 to 1964) right but then carve up the subsequent generations into small subjective psychographic age designations that have nothing to do with demographics. In demography the comparative size of the generation/population passing through time is the major consideration.  Incidentally, in my books I added five years on to Generation Y for what I considered good objective reasons but was persuaded to bring them into parity by my research partners.

Retail Prophet: The first chapter of your book is entitled The Parade of Generations.  Here you ask the question, “Why aren’t marketers paying attention?”  Are there any specific of retailers or brands that you can point to that you feel are clearly ignoring demographic trends and conversely, are there any in your view doing a good job of incorporating generational insights into their strategies?

K.G.: Detroit’ big three thought the Baby Boomers would buy the SUV forever without any ostensible consideration that the Boomer aged out of their peak car buying years. Steve Jobs and Apple have a solid understanding of Generations X and Y and anticipate their demand.

Retail Prophet: In your opinion what is the single most important demographic shift(s) that retailers and marketers in general should be paying attention to over the next 20 years?

K.G.: It’s like the three “L’s” of real estate. Generation Y, Generation Y, Generation Y. Generation Y will redefine retail. So forget what you think you know.

Retail Prophet: For years we’ve anticipated the phenomenon of “the aging consumer”.   Are there any pitfalls that you see for marketers who are attempting to address this?  Any common mistakes to watch out for?

K.G.: The U.S. Bureau of Labor Statistics has reams of research that shows that consumption drops like a stone after fifty years of age. The peak of the Boomers was born in 1957. They will still buy tons of age appropriate products but they will not drive consumer spending. Generation Y will. That being said, The Baby Boomers are forty-five to sixty-four years old. They are not elderly yet and won’t be for fifteen to twenty years.

Retail Prophet: Generations are becoming longer as people take longer to have children.  Does this pose new problems for marketers?

K.G.: No, this does not pose a problem. It is not important when you have kids as long as you have them. What does pose a problem is smaller and smaller families. Do the math. The world is in a precipitous fertility decline. We have for the first time in the history of the world lost sight of the fact that it is necessary to breed if we want to continue. The United States is the only industrialized nation with above replacement level fertility owing to the disproportionate contribution of our Latino contingent.  This is a very serious issue that concerns all marketers.

Ken Gronbach is the President of Age Curve Consulting and author of The Age Curve: How to Profit from the Coming Demographic Storm

Tags: , , ,
Posted in Technology, The Future

Why Smart People Ignore The Future

Tuesday, September 15th, 2009

“In the difficult days ahead, unquestionably we shall face problems of staggering proportions. However, with the faith of our fathers in our hearts, we fear no future.”   President Harry S. Truman

I spend a lot of time talking  with retailers and small business owners about the future .  The future as it affects their consumers, their competitors, their industry and of course their unique businesses.  We discuss social, economic, technological, environmental and political trends and then synthesize them into meaningful, realistic implications for their business.  Once the implications of these future trends are clearly understood, we begin formulating strategies to address them, ensuring the long-term success of the business.  It all sounds entirely rational doesn’t it?

Why then do some business owners so often ignore the future?  It’s not because they aren’t smart people – they most certainly are.  Yet,  there are examples everywhere of smart people ignoring the future.

In the book, Future Inc. author Eric Garland points to how an almost willful disregard for the future has impacted the music industry – an industry filled with very smart people.  For almost a decade, record executives stood by and watched increased internet usage, digital music and file sharing conspire to eat them alive.  And while Apple quietly revolutionized the way music is purchased and enjoyed in the world, the recording industry opted instead to sue their customers, music loving teenagers, by the thousands.

So, we come back to the question, why do smart people ignore the future? Why do they seemingly disregard and discount key trends and changes that can spell opportunity or in some cases disaster for their business?

I think there are several reasons – none of which constitute a valid argument against planning ahead but here they are:

We ignore the future because…

 We shouldn’t ignore the future because…
We’re Scared:

The future can be scary because we don’t understand it and our instincts train us to fear what we don’t understand.  Without foresight the future can simply be overwhelming.

 Even a basic understanding of prevailing trends quickly makes the future clearer.  With some insight into the events to come, we can begin to transform our fear of the future into curiosity.  It’s at this point that we can begin to create a productive, forward-looking strategy.

We Hate Change:

We think that if we open ourselves up to what the future holds it will necessitate that we change.  We may have to leave the comfort of our current understanding and venture into the world of “I don’t know”.     As long as we ignore the future, we can stave off the need to change.

 The long-term winners in business embrace change.  They accept it as the only route to growth and progress. Ultimately it’s not the largest or most powerful companies that survive but the ones most capable of adapting to change.

We’re too busy dealing with today:

The things we need to do today consume all our attention leaving us no time to consider the future.

 The truth is, most companies are actually too busy dealing with yesterday.  The shipment that didn’t arrive yesterday.  The customer complaint that came the day before that.  Or following up on last month’s accounts payable issue.    It’s the past, not the present that prevents companies from studying the future.  This is not to suggest that we disregard the work at hand.  However, if you ignore the future long enough, there may cease to be a present to worry about …just ask General Motors.

We don’t care:

There will always be an element of unabashed complacency in business. Some businesses have achieved as much success as they care to, or they may be at a point where they simply want to sell and get out.  Regardless, complacency is the enemy of change.

 Businesses that study and integrate trending often have higher market values than their out-of-touch counterparts.   What business would you rather buy – one that was old, tired and behind the times or one that was on-trend, current and plugged in?

We think we are prepared:

Experts estimate that at least a third of baby boomers are totally unprepared for retirement and don’t know it.  Similarly, studies show few small businesses are adequately prepared for the future.  However, a surprising number firmly believe that they are.  Many claim that their customers keep them apprised of the future on a daily basis.

 The idea that your customers will inform your knowledge of the future is simply false.  Customers have no idea what will happen in your business ten years from now.  Nor do they care.  Customers live in the now.

Unless you can articulate a clearly formulated strategy to the future, you don’t have one.  It’s just that simple.  And you can’t formulate a strategy without gaining insight into the future.

We can’t visualize the pay-off:

We’re trained as business people to look for ROI.  For every dollar we spend we should get a defined payback, within a defined period.

 The future  strategy is like a high interest savings bond that pays you later.  The immediate outputs of future work are models, projections and most importantly, strategic options.  With these in hand, you can begin to craft the tactics that will lead you to the future you desire.  The evolving image of your business that you aspire to.  Then and only then, will you realize the ROI of future work.

Posted in The Future

The Road To Remarkable: 10 Steps to Standing Out

Wednesday, September 9th, 2009

Shakespeare said “Some are born great (and) some achieve greatness…”.  The same can be said of businesses. There are those that are brilliant from the start but they’re definitely in the minority.  Others will never become great; not because they can’t but because they choose not to.  It’s the businesses in the middle, bursting with potential that excite me the most.   The problem is that many retail companies have difficulty innovating.   They often break down somewhere on the road to becoming remarkable.  Frequently all that’s needed is a creative nudge in the right direction. REMARKABLE 1

There’s no patented formula for innovation but there are creative approaches to differentiating your business.  The following is a creative framework that’s part of a workshop we conduct for retailers that helps them find their mojo, if you will.

Once you’ve decided to take your store to the next level, follow these steps.  They’ll open up your thinking in several different directions and can produce surprising innovation.

  1. Go Deep:  Brands are a lot like people.  Throw a cocktail party and I guarantee that by the end of the night most of your guests will remember the same people.    The people who are interesting, dynamic and deep.  Your unique business story and how you tell it can make you remarkable.  The story behind Tom’s Shoes, for example is quite amazing and draws us in as customers.
  2. Go Narrow: I used to go to a restaurant in Montreal that served nothing but hot dogs, fried bologna sandwiches and fountain sodas.  Every day, from 11:00 am – 2:00 pm they had a line up out the door!  Not only did the quirky, three-item menu make them stand out, it also allowed them to focus on being awesome while offering a limited number of items.  And believe me, they were awesome.  How narrow can your offering be and would it make you stand out?
  3. Go Backwards:  Explore the history of your product.  Look for intriguing methods of manufacturing or selling.  Reach as far back into the history as you can.  You might find some really interesting information along the way that you can integrate into your store experience.
  4. Go Forward:  This is probably the trickiest one of all, but by using research and a little intuition you may be able to anticipate what the future of your product category holds.  Do you foresee anything unique or different happening?   Are there any trends affecting product, pricing structures, merchandising or store design?  If so, is there anything that you can leverage now?  Anything that will be unique?  For example, if you’re a book seller, you’re likely very worried about the emergence of e-books and Kindles.  So perhaps a proactive shift to carrying nothing but collectible, hard-to-find books would allow you to differentiate and carry on successfully.
  5. Go Against:  Identify industry paradigms and challenge them.  If there’s an accepted standard, ask yourself if there’s merit in breaking it.  Even simple things like merchandising conventions, when turned on their ear, can be exciting.  Here’s a vitamin store in Austin Texas that looks anything but conventional.
  6. Go Crazy:  Literally make a list of the craziest things you could do to make your store stand out.  Don’t just be “a little” of anything.  Be a ton of it.  If you’ve established that service is your competitive advantage then don’t just be marginally better.  Literally shame your competition.  Blow your customers away.  Become notorious for your service.  Then and only then will it be remarkable.  Jungle Jim’s Grocery in Fairfield Ohio carries 1,200 varieties of cheese.  Why?  Because they established that selection was their competitive advantage and in order for it to be remarkable, they would have to offer a selection of epic proportions.
  7. Go Naked:  Before you get too excited, I mean try stripping your business concept right down to the bare essentials. Could your sales process be remarkably simple?  Could your assortment be remarkably clear?  Could your pricing be remarkably transparent?  How much excess and confusion can you take out of the value proposition?  Sometimes layers of process, protocol and paperwork get built into a business over time.  Can you simplify it and would it be remarkable if you did?
  8. Go Home:  Is there a point of origin for your product category; a kind of birthplace or Mecca so to speak?  Maybe a visit to that place will avail fresh thinking that can help you differentiate.   If you sell fine china, perhaps a trip to England or Holland would get some ideas flowing.  Sometimes it’s the archaeology of things that makes them most intriguing.
  9. Go Abroad:  Too often, we build businesses based on our narrow domestic understanding and sensibilities.  Starbucks took the coffee house concept that was common in Italy and imported it to the U.S. where it was unique and exciting.   Explore how your product is sold in other countries.  You might be surprised at some of the amazing concepts you could import into your business.
  10. Be Relevant:  Above all else, be relevant.  Throwing a pie in the face of every customer who walks into your store would definitely be remarkable.  However, I’m guessing that it would also be irrelevant with respect to what you sell.   Your innovations should complement the experience of buying your products or services, not impede them.  Remarkable is only valuable if it’s relevant.

The most important thing for you to remember is that the distance between ordinary and extraordinary is often not as great as we fear.  They key lies in beginning the journey.

Tags: , ,
Posted in Branding

Get Adobe Flash playerPlugin by wpburn.com wordpress themes