Art Twain: Staying Loose and Coloring Outside the Lines

A Personal Retrospective

I don’t know where to begin with this story. It’s about retail, forgotten brand origin stories, advertising, and the golden age of radio. You might say it’s a trip down memory lane, but my instincts tell me it’s really a story that touches upon so many things that are so right now. Every time I hear someone talk about how retail taps into culture, or asks why we are suddenly devouring podcasts, listening to the radio, and enamored with the ’70s, I think of Art Twain.

Right around the time in the ’70s when advertising was changing and creatives took over from account executives, things started to get looser. With little guidance, retailers, brands and marketers were compelled to understand and respond to that cultural shift.

Enter Art Twain. He’s the marketing mastermind behind the original brand development of a little shop called Pants and Discs. He was also the account lead for that brand of “pants” which, at the time, barely sold east of the Mississippi. That shop would become the Gap and those pants were Levi’s. The fact that the Gap was born selling Levi’s and LP records is an origin story that has mostly been lost to memory. [Read more…]

Pirch, Lululemon, Cabela’s, Burberry, Apple: What Do They Have in Common?

Addictive-BrandsThese brands are not retailers.  They are neurologically addictive experiences, co-created by the brand and their dopamine-addicted consumers.  And not so incidentally, the experiences happen to take place in physical buildings. And oh, yes, because the customers are addicts, they buy tons of the brand’s stuff and they can’t get back to those experiences fast enough for their next fix.  By the way, for those of you who don’t know what dopamine is, it’s a chemical in the brain that gets released every time we have an elevated experience. It provides feelings of euphoria, self-satisfaction, wellbeing, and can lead to addiction.

The dopamine-releasing brands headlining this report (and there are others) are such because the experience they have developed requires that the customer participate in creating or shaping the that experience to satisfy their own personal desire at the moment they engage with the brand. [Read more…]

Happy Accidents

happy_accidentsOffering a wider assortment at every store helps increase sales while keeping complexity in check.

Less is more: This is the prevailing wisdom of today’s retail assortment strategies; assortments should be localized, limited, and carefully curated.

But, more often than not, bigger is better. Carrying a wider assortment in each store can boost sales without increasing cost, space needs or inventory. In fact, it’s possible to offer complete assortments while decreasing inventory. This sounds counterintuitive, but there’s logic to the strategy.

Why is the industry so fixated on slashing assortments? The “choice is a trap” and “paradox of choice” arguments — that consumers actually prefer only a few options instead of being confronted with a wall of choices — is gaining traction in popular culture and especially at retail. And, while it may be accurate in certain limited settings, it doesn’t hold true when applied to the industry at large. In fact, as assortment size goes up, sales always increase. [Read more…]

I’ve Got Mail!

Monitoring a year of Macy’s email…and living to tell about it.

First things first: My e-hat is off to all the programmers, merchandisers, web technicians, copywriters, graphic artists and digital geeks who run the Macy’s direct email program. Well done, guys. I am in a position to make this evaluation after what seemed a rather simple task: I would gather and save all the promotional emails Macy’s sent me as a customer over the course of one year. I began moving those messages rom my inbox to a separate folder on Jan. 1, 2014, and filed my last one at 11:46AM this past Dec. 31.

Simple my ass…ortment.

As a customer who had made home, apparel and jewelry purchases from Macy’s over the years, my inbox became a breeding ground for a promotional onslaught that neared biblical proportions. By any measure — quantity, variety, creativity or just plain audacity — my year with Macy’s email was memorable. First, the volume, which was indeed voluminous. I received an email from Macy’s virtually every day. Some days I received two. Occasionally, I missed a day, which I attributed more to spam filters than any lack of enterprise on the part of the store’s promotional department. [Read more…]

Is There a Serial Killer Loose in Your Corner Office?

serial_killerYou don’t have to be a criminologist to know that Serial Killers kill people. Retail Serial Killers (or RSKs) on the other hand, are, in my opinion, CEO’s who through their lack of skill, recklessness, disingenuousness, or gross incompetence, destroy the businesses they have been tasked to lead.

I believe that RSKs are the scourges of the retail industry. Businesses which have taken decades, if not generations, to become successful through the talent and hard work of dedicated teams, are murdered in short order by RSK’s. These RSK’s should never have been given the baton in the first place, or who, upon demonstration of lack of skill, should have been promptly removed from power when it became apparent they could not perform credibly. RSK’s are never indicted. In fact, they are often rewarded handsomely for their efforts.

Consider some of the retail industry’s most notable Serial Killers: [Read more…]

Jonathon Duskin Who?

Jonathan-DuskinActivist Lightweight Attacking Children’s Place

I like being an activist myself, but a special kind.  I like attacking financial activists who assume they understand the businesses they are attacking, yet build stories based on the only thing they do understand: numbers. These stories are all about creating greater shareholder value, but mask the real objective, which is to make tons of money for themselves. Sadly,  90% of them don’t know what the word strategy means and couldn’t operate their way out of a paper bag, much less lead the process. Most of them destroy more value than they create.

Which brings me to Jonathan Duskin, the current poster child activist lightweight, whose track record could only be described as “failing upward” as he became CEO of Macellum Advisors. Somehow he got Barington Capital Group to collaborate with him (I guess he needed their now questionable credibility) in sending an “attack” letter to Norman Matthews, revered industry veteran and Chairman of the Board of Children’s Place (PLCE). The delusional letter, penned by Macellum and Barington, was sent from out of the blue (or black) the night before Children’s Place’s 4th-quarter earnings call (March 12th), attacking the company’s operating and leadership performance under its CEO, Jane Elfers. The “delusional duo” of Macellum and Barington (the delusion revealed below), with a 2 percent share of Children’s Place, had not uttered a peep of discontent during any of the four previous investor calls throughout 2014 — or even two months prior to the attack letter. Perhaps Duskin was trumping up the delusion in a dark room somewhere before luring Barington into the deal?  Who knows? [Read more…]

Checking the Pulse of the American Shopper

pulseFrom a retail perspective, it’s hard to find numbers or analysis of the past year without also finding the word “cautious” in close proximity. Holiday spending for 2014: Cautious. Consumer attitude from recent gasoline price drops: Cautious. Outlook for 2015…. You get the picture.

Given the depth of the financial crisis in 2008 and the habits of the post-crisis consumer, this attitude can hardly be blamed. For retailers, however, the state of the American consumer might better be described as “tempered.”

It describes a cohort that has been tried, toughened and come through stronger. That’s what MasterCard Global Insights research shows. Our most recent work on the attitude toward credit and debit spending — arguably a leading indicator for retailers — captures a more nuanced portrait of how Americans are feeling about the economy and their own pocket five years into the recovery. In short: The post-crisis consumer has learned some tough lessons and come through with a tempered but tactical attitude toward credit and debit usage, disposable income, and saving for the future. [Read more…]

Retail’s Darkest Secret: The Knowledge Deficiency Gap

Store format redux from retail’s emerging trends in 2015 has proven that retailers are marching ever forward in this disruptive industry landscape. Big format stores are investing in smaller format editions, department stores are dabbling in specialty and online e-tailers are dipping their toes into the sea of physical stores.

However, despite all of the market research, strategic development, capital investment and operational execution of newly designed stores, retailers must not overlook brick-and-mortar retail’s darkest secret — and perhaps largest problem in general — “the knowledge deficiency gap” of associates. Customers are coming through the door armed with an arsenal of researched information on products and pricing. The hidden truth is often the customers know more about the brand, products and policies than the associates in the stores. [Read more…]

How Consumers Pocket The Change In Global Oil Prices

pocketoilchangeProbably the biggest global economic story since the collapse of the credit-based global economy in 2008 is the implosion of petroleum prices, which has had a direct, if lagging effect on retail sales in the U.S.

As of this writing, the price of a barrel of crude oil has recently gone below $45. The global economic situation is volatile enough to potentially reverse this trend, however, for the moment the  benefit remains with the consumer. Thus it’s worth taking a look at the economic and spending behavior that follows oil price declines because it has implications for business and industry across the country. [Read more…]

Stampede to Organics Awakens Sleeping Giants

wholefoodsWhole Foods has succeeded beyond all expectations, but, strangely, that’s not all good for Whole Foods.

Whole Foods was founded 35 years ago in Texas based on the premise that there had to be a safer way to produce food than the mass-manufactured and over-processed approach. (Deep background: Whole Foods was originally named Saferway, a poke at supermarket chain Safeway.)

The Whole Foods concept was to leave conventionally manufactured food behind wherever possible in favor of natural and organic food, and to put a heavy emphasis on fresh. The concept also was that consumers would warm to the idea and pay a premium for such products. Development came slowly to Whole Foods because at the time, there was little consumer buy-in for such an idea. [Read more…]

Ghost Malls: Creative Destruction

ghostmallsIn the horror story of the declining fortunes of the American shopping center, the central character is the “Ghost Mall” – abandoned, forlorn, and lifeless — but looming, casting a post-apocalyptic pall over the American Dream. The website, DeadMalls.com, provides ample evidence that ghost malls are real and that they appear to be a growing insidious blight across America. The eerie photos show boarded-up entrances, broken glass, empty storefronts and hulking monolithic edifices surrounded by desolate unkempt parking lots. Hollywood even used a ghost mall to symbolize menace and hopelessness in last year’s psychological thriller “Gone Girl.”

Frightened yet? Well don’t be. In a country with an astounding 23 square feet of shopping mall space for every man, woman and child – representing almost 70% of the world’s supply — it should come as no surprise that some obsolescence and creative destruction is inevitable…even desirable. [Read more…]

An App For Hugging? Never, Ever at Mitchells

mitchellThere should be a Master’s degree in customer engagement (MCE) obtainable from Harvard or any of the other top-tiered universities. It should be as revered and valued as an MBA, including comparable compensation.  And every retail associate or associate wannabe, for both online and off, should be required to obtain that degree. Why? Because it is the most critically important job in retail, even more important than all the hotshot jobs in the C-suite. I use the word engagement, rather than service, because readers’ eyes tend to glaze over upon reading about customer service, a term they have become desensitized to because of its redundant over-use. Plus it has become a “paying-lip-service” term for too many retailers.

In fact, the MCE curriculum could be copied right out of Jack Mitchell’s revised and updated book: “Hug Your Customers,” published by Hachette Books, on sale today. For readers who are not aware of Mitchells Family of Stores, they are a group of five upscale designer and luxury goods stores (Mitchells, Richards, Marshs and two Wilkes Bashford stores) that have total annual revenues north of $125 million and growing. While there are a few other retailers with notably high levels of customer engagement (Nordstrom for sure), Mitchells is legendary for their over-the-top personalized connectivity with each and every customer, starting from day one in 1958 when they were founded. [Read more…]