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Green = Sales?

April 28th, 2009 by Devangshu Dutta

An article in Convenience Store Decisions wonders “Can Packaging Boost Sales?”

According to the article, in November 2008 McDonald’s reported that 82 percent of its packaging in its nine largest markets is now made from renewable materials. And “convenience store retailers are following Mickey D’s lead, seeking to capture a greater share of takeout sales as well as respect the earth with reliable, environmentally friendly packaging that won’t drive up the cost of takeout meals.”

The question is: how much of a selling point is green packaging at retail? Is the sales lift worth the investment in green packaging?

(At the risk of sounding naive,) I think well-conceived green packaging (starting with reduced packaging) would be a win-win-win: lower cost for the retailer, higher acceptability with the consumer, and better for the planet.

On a different note, we do conveniently ignore the true cost of the excessive throw-away packaging. If the cost of disposing that were added to the price of the product, the switch over to green packing might be faster.

I recall reading about a protest in the UK a couple of years ago by consumers who unwrapped excessive packaging at the cash-till and left it there – imagine that at your local supermarket on a Saturday!

The original article from Convenience Store Decisions is here: Can Packaging Boost Sales?

Posted in Corporate Social Responsibility, Food & Grocery, Marketing, Retail, Uncategorized | No Comments »

Targeting Mr. Mom

April 27th, 2009 by Devangshu Dutta

Retailwire.com prompted a discussion on what, if anything, should grocers and other stores be doing to accommodate the growth in stay-at-home dads?According to the US Bureau of Labor Statistics, the recession is putting more men out of work than women, which has led to an increase of stay-at-home dads who are increasingly taking on the traditional women’s roles of childcare, housework, school life, and shopping.

Here’s my contribution to the Dad wishlist: salespeople who don’t look down their noses when asked a (“stupid”) question Mom would never have dreamt of asking. (Also, considering this is the gender that apparently never stops to ask for directions, please treat the question as close to a life-or-death emergency.)

Posted in Apparel, Consumer, Customer Relationship, Food & Grocery, Footwear, Lifestyle & Fashion, Market Research, Marketing, Retail, Soft Goods, Textiles, Uncategorized | No Comments »

Customer segmentation – Learning from the Vedas

April 23rd, 2009 by Devangshu Dutta

Advertising Age recently carried an article titled “The Death of Customer Segmentation”, by Michael Fassnacht.

He questions the traditional marketing hypothesis that the better we segment consumers, the better we know what is relevant and the better we can market to them.

Fassnacht argument is that:

  1. Segments are becoming more volatile [totally agree!]
  2. Consumers are never part of just one segment [fashion companies discovered that a few years ago, and began marketing to "purchase occasion segments" rather than plain-old consumer segments defined by demographic and static psychographic profiling], and
  3. Consumers are preferring to choose what information would be relevant and of interest.

This last point is of particular importance, since electronic media – especially websites that customize themselves based on analysis of the users behaviour and history – are becoming more prevalent communication platforms. In fact, for the last few years “mass customization” and “a consumer segment of one” have been fashionable phrases thrown about in marketing circles.

Fassnacht quotes Amazon, Apple and social networking sites such as Facebook and MySpace to support his well-structured argument.

However, it may be a challenge for traditional retailers and brands to apply the learnings from these brands in their physical stores.

Going further and on a lighter note  – or perhaps not :-) – if we are to believe the philosophy of the Vedas, the Universe has a head start on “self-segmentation” and “customization of consumer experience” technology. According to it, the world and our experience of it is “Maya,” an illusion product of our mind, and we are free to create and mold it, and experience it as long as we hold the illusion.

If that’s the case, our modern techies and marketers have a long time to go before they climb that technology curve.

The original article is available here: The Death of Consumer Segmentation?

Posted in Apparel, Consumer, Customer Relationship, e-commerce, Footwear, Lifestyle & Fashion, Market Research, Marketing, Retail, Soft Goods, Strategy, Textiles, Uncategorized | No Comments »

Choosing Between Profit and Purpose

April 22nd, 2009 by Devangshu Dutta

The Austin American-Statesman asks: Is a purpose-driven company more likely to profit? The idea is that, no matter what product or service you are selling, successful companies often have a deeper purpose beyond making a profit.

It’s a moot point or loaded question or just a load of [fuzzy-thinking], depending on your point of view. We’re likely to get sucked into a debate about whether businesses should just focus on business (i.e. making money) or should they be governed by a “higher” purpose than that.

Someone wise once wrote: we need to break away from the tyranny of “or.” Having a purpose beyond making money, and making money are not two diametrically opposite directions for a business.

Focusing only on profits gives us scenarios such as we’ve had with the banks in the last year. There is no end to greed, and a business that is solely focused on increasing its own revenues and profits essentially becomes a dysfunctional member of civil society.

On the other hand, a business that is not focusing on making profits and only follows some other “higher calling” is on the expressway to the business graveyard, taking the higher purpose along with it.

I think the principle of enlightened self-interest works for businesses as well as it does for individuals.

This is the Austin American-Statesman article on the subject: Is a purpose-driven company more likely to profit?

Posted in Corporate Social Responsibility, Entrepreneurship, Leadership, Strategy, Uncategorized | No Comments »

More Luxury Customers at Outlet Malls

April 16th, 2009 by Devangshu Dutta

The recession is taking a toll on the business models of premium and luxury retailers.

According to the Los Angeles Times, faced with sales declines at their full-price stores, Neiman Marcus, Saks Fifth Avenue and Nordstrom are lavishing more dollars and devotion on their outlets which are performing better than their traditional stores.

According to Robert Wallstrom, president of Off 5th, Saks Inc.’s outlet division, “These days, customers are saying they want a brand, customer service and a deal.”

Outlets may just be the lifeboat needed by some of the brands to get through the current downturn, with the mix of the “real steal” deals to get the footfalls and the “just a little off the top” to get the margin. The current outlet stores are good enough to avoid severe damage to the brand.

However, a critical question does remain unanswered: once the consumer becomes used to shopping at a certain price level, might some brands struggle to move back up the curve?

Posted in Apparel, Branding, Footwear, Lifestyle & Fashion, Marketing, Retail, Soft Goods, Strategy, Textiles, Uncategorized | No Comments »

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