Tag Archive for 'online shopping'

Zombie Retail

Published on April 23, 2010 in Eric Steckling. 0 Comments Tags: , , , , , .

Eric Steckling, Pitney Bowes Business Insight

As Americans and consumers, we have all witnessed the decline of countless national retailers in the past decade only to see them rise from the dead and live again. When a failed company is dismembered by bankruptcy court or investors, one intangible asset is generating interest; the company name. One question persists, if a brand failed to be successful in the retail arena, why would anyone want to invest in and perpetrate a brand that consumers have largely abandoned?

Each zombie puppeteer has different strategic reasons for acquiring the rights to failed corporate identities but one underlying theme prevails; brand equity. As a brand matures, customers become familiar with the company’s offerings, product assortment, pricing, ect. This “familiarity” coupled with millions of dollars spent annually on advertising can turn into loyalty and goodwill. This customer recognition is extremely expensive to create from scratch, which is why it is often appealing to resurrect a brand.

Once a $2 billion a year company, CompUSA succumbed to increased competition and torpid sales. Even though CompUSA closed most of its stores in 2007, consumers are largely still aware of the corporate name, identity and offerings. Acquired by Systemax in early 2008, arguably the most valuable piece of the company was the website and logo which is still used to sell merchandise online. The company is now reinvesting in their store network (see Retail 2.0: Brick vs. Click). After 60 years in business, Circuit City fell victim to the same perils as CompUSA. The $14 million Systemax paid for the company’s identity will probably top the price fetched by the company’s former 288,560 square foot headquarters recently returned to its lender. The building recently appraised for $46.2 million is listed for sale for $11 million.

When a retailer comes back to life with an internet only business model, name and reputation are by far the biggest assets they have to drive traffic and sales. With mitigated real estate, inventory and labor costs, online only retailers have much fewer expenses than their brick & mortar counterparts, allowing them to profit on much lower sales volumes. The next question is who is the next national retailer to close shop and serve your town from the sidelines of the internet? My guess: Blockbuster Video.

Retail 2.0: Brick vs. Click

Published on April 1, 2010 in Eric Steckling. 0 Comments Tags: , , , , , , , , , .

Eric Steckling, Pitney Bowes Business Insight

CompUSA is attempting to neutralize the Internet’s one big advantage: Information. In an effort to improve the retail shopping experience, CompUSA has upgraded 23 of its 32 stores to the “Retail 2.0” version. Chief executive of parent Systemax Technology Products Group Gilbert Fiorentino has designed new product displays that include touch screen computers which provide specifications, pictures, customer reviews, competitor’s prices and other information about the products on display. The idea was to change the passive approach to retail and engage the customer. CompUSA has found that information empowers the customer and allows them to make more informed decisions, which Fiorentio says is translating to loyalty and increased traffic.

So what’s next for “Retail 2.0”? Amazon.com often gets me to buy items by simply suggesting them to me based on items I have in the cart, have already bought or even looked at. These (usually on target) suggestions are generated from a vast database of the browsing and purchasing records of myself and the other 76 million unique visitors last month.   The difference is data. Online retailers have an easier time collecting and storing customer data. Most brick and mortar retailers have been slow to collect or utilize transactional data, which is instrumental in improving stores’ customer experience.

It is evident that technology will play a key roll in helping retailers “engage” their customers. RFID controlled inventory and smart shopping carts could perform the same suggestive functions by identifying items in your cart and making suggestions based on prior customers’ cartloads. To fully leverage transactional information retailers must also know who you are, another task Internet retailers have no trouble with. Once the customer is identified, Retail 2.0 should include social media interaction as well as purchase driven targeted emails. Only time will tell what other innovations brick and mortar retailers will create to slow the market share loss to online vendors.

12 ways location data yields better decisions – Part I

Published on January 14, 2010 in Deb Purcell. 0 Comments Tags: , , .

Location intelligence has clearly become a mainstream business practice—driving decisions across most every department. As we begin 2010, we wanted to provide you some insights into twelve of the latest trends and applications. Today we’ll look at how geo-spatial information supports customer-facing initiatives.  Next week, we’ll examine the same trends in operations and the public sector.

Site Selection. Opening a new store or branch location can cost millions of dollars, with payback often calculated in years. Companies can now analyze market demographics, competition and consumer buying habits across alternative geographies in order to predict events well into the future. This is especially important in times of economic uncertainty, when many firms are deciding whether or not to close or relocate stores and branch locations.

Customer Segmentation. Marketers can go beyond simple postal codes to identify households at the neighborhood and street level who are most likely to become new customers or to purchase additional products and services. Color-coded maps overlay multiple levels of data, including revenue, Census information, proximity and customer penetration—making it easy to visualize how market demographics correspond to sales potential.

e-Tailing. The exponential growth of online shopping adds another dimension to marketing decisions. While consumers may transact in a “virtual world” they still access the Web from specific locations. Understanding the relationship between where online customers live and work vis-à-vis the location of retail locations and competitive outlets makes it easier to develop strategies that best leverage both on- and off-line efforts.

Customer onboarding. The opening of a new account can be one of the most critical times in the relationship between a customer and a company. Geocoding applications help validate the exact location of new accounts so correspondence and shipments reach customers in a timely fashion. Increasingly, organizations are also using location-based information to make real-time decisions on which products or services to cross-sell in the first 90 days, when customers are most open to expanding their relationship.

Customer self-service. With an ability to integrate vast amounts of data, analytics and customer-friendly mapping applications, customers can now view the same information used by back-office personnel. In one instance, an insurance company shared details on a hurricane’s path online, discouraging individuals from submitting false claims.

Customer care. In many companies, telephone reps now navigate intuitive, user-friendly mapping applications to make on-the-spot decisions based on location. In most cases, these technologies are employed to identify cross-sell opportunities and provide accurate information to customers regarding network access.

While spatial analysis is just now hitting its stride in terms of business applications, it is likely that major breakthroughs are yet to come.  New tools and solutions are making it even easier to locate new opportunities, connect with customers and communicate more efficiently.  So tell us… what other ways are you tapping the “power of where” in your business?

Retailers Embrace Cyber Shopping

Published on January 7, 2010 in Elizabeth Zachry. 0 Comments Tags: , , .

Elizabeth Zachry, Pitney Bowes Business Insight

Shopping malls have been around for hundreds of years and, thus far, have been able to respond to the ever-changing demands of the consumer. What started as simple structures in downtown areas of cities have morphed into grandiose buildings in suburban settings. However, with an increasing number of consumers turning to the internet for bargains, retailers are trying to find new ways to bring shoppers into their stores. According to the U.S. Census Bureau, e-commerce sales have steadily increased over the past decade, from less than 1% of the total quarterly retail sales to more than 3%, with current trends indicating that online shopping will only increase.

Instead of fighting this trend, retailers are embracing the internet and finding new ways to integrate the online shopping experience with the traditional storefront. Some retailers, such as Gap Inc., offer the opportunity to order products online from within the store, making shopping easier for consumers when the desired product is out of stock. In addition, several retailers, such as REI, Sears, and Nordstrom, offer online consumers the option of picking up their items at a retail location, eliminating shipping costs and shortening wait times for packages. Many retailers and shopping centers even have their own Facebook pages and Twitter accounts, where people can become fans and followers and can get regularly updated information on sales and store promotions.

Increasing use of mobile technology has also led to new applications designed to improve the in-store shopping experience. One such application, by NearbyNow – a company in Mountain View, California, allows users to find and hold products in the stores nearby. If, for example, you are looking for a black shirt, the application lists all the stores in your area that sells black shirts, gives you the option to put a shirt on hold – even lets you email pictures of the various shirts to your friends to judge.

Certain aspects of internet shopping will be impossible for shopping malls to replicate, but it seems as though the future of retail encompasses both the storefront and the internet.