How companies including Office Depot and Joann keep local retail relevant

Today, brick-and-mortar stores have to be more than a place to buy something. They have to become places where we do things such as learn and connect. 

Forbes Online: Retail Revival: How Joann, Office Depot And Even Nordstrom Are Staying Relevant, 2018-Jul-3 by Bryan Pearson

The sewing and fabric chain, once a fixture at strip centers, has made a sharp turn on the path to what many might have thought was obsolescence and is remaking itself. New technology, new creators’ studio, new target market.... Following 18 months of intensive research, the chain has unveiled its concept store in Columbus, Ohio, combining elements of community building and technology. 

The store offers rentable sewing machines and crafting tools for the crafting curious and a service called Sew & Go, through which customers can hand off their projects to seamstresses. There are personal shoppers and a no-wait fabric “cut bar,” where shoppers can drop off their pre-measured orders and selected fabric and receive mobile alerts when they’re ready to be picked up.

Among the key features is a creators’ studio, with a Starbucks counter, for classes and social events such as birthday parties and Girl Scout activities. Also featured are touchscreen kiosks showing Pinterest craft projects, with instructions, that can be personalized by user.... 

Office Depot identified its emerging core market in new business owners and entrepreneurs, many of whom seek the expertise of “Biz Pros.” Its BizBox concept, at 14 locations in Texas, is an all-in-one-box suite of services and networking opportunities where visitors can work, build and collaborate.

The stores, in Austin, include flex workspaces where customers can seek face-to-face expert advice from BizBox professionals in “consulting hubs” and network with fellow entrepreneurs and business owners. There also are designated “Tech Zones” where professional tech support staff can help with computer snafus, smartphone repairs and other common challenges.

The service-led concept, which is planned to expand to other locations, is designed to free up business owners from workaday hindrances so they can focus on innovation and growth. 


How Walgreens and CVS can fend off Amazon

Stop and imagine for a moment that you could no longer dart over to the drugstore to choose the right kind of bandage for that fresh cut on your hand. Suppose you had to order online, and maybe you could get one-hour delivery but what if that bandage didn't fit... 

We don't think that allowing Amazon to close down all the neighborhood drugstores is a good idea. We hope those drugstores can crank up the in-store experience and keep contributing to healthier neighborhoods for a long, long time. 

The Wise Marketer: How does CVS ExtraCare stack up against Walgreens Balance Rewards? The Tale of two Tapes, 2018-Jul-6 by Bill Hanifin

[The CVS] pharmacy keeps the value of ExtraCare squarely in front of its members at the point-of-sale and actively serves up a large volume of manufacturer coupons. It also delivers twice the rebate at a base level, while Walgreens is allowing its differentiating set of lifestyle rewards to slip further into the fine print of its program benefits.

The bigger question is whether either program packs the punch to serve as an Amazon/Pillpack vaccine. In both cases, the communication of program benefits could be sharpened to heighten the perceived value of the program to its members. Points could be offered more extensively in the aisles to give the daily shopping experience a “treasure hunt” feel, something that is difficult to replicate online. And, the role of the neighborhood pharmacy as vital to our ongoing health is something that can be communicated and supported through the rewards program.

On this note, much more could be done by both programs to make the reward program a more vital part of the daily shopping experience and remind customers the unique value of a brick and mortar pharmacy. Adding this aspect of value to both programs could prove to be the treatment needed to stave off customer defection to the newest online competitor. 


Apple and the misty-eyed vision of retail's future

We hope that Angela Ahrendts is right about the customer and employee experience at Apple stores. They are wealthy enough to have very expensive stores that don't cover their cost in revenue. But we have to wonder if this model is fragile, and will be unsustainable when that perfect cultural alignment falls the least bit out-of-whack. 

Apple stores will not necessarily be a competitive advantage against Amazon. Amazon's physical retail will evolve quickly, and Apple will probably have to respond. 

Marketing Week: Apple’s Angela Ahrendts: Retail is not dying, but it has to evolve, 2018-Jun-20 by Charlotte Rogers

Describing stores as Apple’s “biggest product”, the senior vice-president for retail outlined a clear and compelling business case for physical retail during her session the Cannes Lions Festival today (20 June).... 

She sees physical stores as space for human experience, a reason why typically a third of square footage in all new Apple stores is dedicated to the delivery of the brand’s year-old education programme, Today at Apple.

“We’re not opening small stores, we’re taking the small stores and doubling or tripling the size of them to accommodate a forum and we’re only opening big stores in the future that can handle it,” she said.... 

Ahrendts describes her retail staff as “the secret sauce” that helps Apple stand out in a fiercely competitive market.... 

“They’re our ambassadors, they’re our greatest differentiator. This is something that Apple has that Amazon and Alibaba and nobody else has – people on the front line. And remember they’re hired to this day to enrich lives,” she explained.

“You’ve been to an Apple store, you feel that energy. The values at Apple, the values of the store teams, the loyalty and the tenure – it’s a culture that is so aligned...." 


Lego, BMW and other brands build loyalty with co-creation

When we work to generate and, even more importantly, accept ideas from our customers, we create bonds that last. 

Econsultancy: Lego to BMW: How brands have used co-creation to earn consumer trust, 2018-Jun-19 by Nikki Gilliland

...consumers are far more positive about a brand (and are more likely to promote it) if they can participate in the creation of its products.... co-creation can also allow brands to appear more caring and conscientious, and more likely to work towards social good....

Lego fans to post their own designs for new playsets, with the projects that receive over 10,000 votes then being considered for production. As well as the sheer joy that comes along with creating their own set, the winner also receives 1% of net sales, giving them a monetary incentive for participation too.... 

BMW is one automotive brand that has used co-creation to drive innovation. Its ‘Co-Creation Lab’ is a virtual community created way back in 2010 whereby consumers can offer their opinions on designs, submit their own ideas, and get involved in the creation process of vehicles.


Will Comcast be influenced by Sky's maverick loyalty program?

The tradition in the pay-TV industry is for providers to grow by dangling short-term offers at new subscribers. Existing customers usually see their rates spiraling upward over the years. Last year, Sky TV in Europe turned a new direction and began promoting better benefits available the longer customers continue to subscribe. It's important to note that these benefits do NOT include rate guarantees nor rebates. Instead, Sky bonuses their customers with experiential benefits, including upgraded broadband and VIP customer service. 

Now that Comcast is planning to buy Sky, we have to wonder if this program could spread to Comcast's U.S. customers. For now, the program is focused on reducing churn, but one day we could see them telling new prospects: switch and you'll begin accruing benefits over the years. 

Marketing Week: Sky steers clear of 'bribery tactics' as it targets 4.5 million loyalty members, 2018-Jun-13 by Ellen Hammett

1.8 million people have already signed up to Sky’s 10-month-old loyalty programme – which rewards tenure rather than spend – which launched last summer following complaints from existing customers that newer ones were getting better deals.

It was also an attempt to reduce churn amid growing competition from the likes of BT and Netflix, as well as to encourage more people to download the mobile app, which is where Sky VIP sits and one of Sky’s core metrics.

The loyalty scheme now accounts for 33% of the weekly traffic to the app, while Sky claims churn is at its lowest level ever having entered a fifth consecutive quarter of decline. Figures for the second half of 2017 reveal the number of customers leaving Sky fell from 11.6% at the end of 2016 to 11.2%.


Leveraging data for loyalty at Marriott

We know that Marriott is working with Salesforce to build the type of customer information platform they need. The investment will be substantial and re-training the employees will take quite a while, but it's essential. 

TechRepublic: Why Marriott's CEO worries more about Amazon and Facebook than Airbnb, 2018-June-13 by Matt Asay

I have Marriott's highest status within its loyalty program, yet the company still struggles to know very much about me.

For the past year, hotel employees have greeted me (and anyone else using the mobile check-in functionality) with "Hello, Mr. (insert mispronunciation of my name here). We've been expecting you." Except that it's clear they generally haven't been expecting me. And that they know very little about me. 

Amazon, by contrast, knows what books I read, the sorts of things I buy for my home, what I ask Alexa to do, etc. If Amazon were to partner with an Airbnb or similar, for example, it would be able to provide a much more satisfying stay, informed by data....

The sad irony is that I will gladly give a company like Marriott much more of my data if only they'll agree to use it to improve my travel experience. They don't, and this leaves an opening for the far less scrupulous digital giants to mine my data for their own benefit, not mine.



Loyal, healthy habits to be rewarded by the Dallas Mavericks

We heartily endorse brands that view loyalty as a customer habit to build instead of an incentive or promotion where loyalty is purchased. The Dallas Mavericks are partnering with a new blockchain-based company that rewards participants for meeting fitness challenges. These challenges are flashy, but if they lead to long-term loyalty to good habits at a fitness facility, it will be win-win-win for Lympo, the Mavericks and the customers. 

Press Release: Dallas Mavericks and Lympo app announce multi-year partnership to promote health and fitness tech, 2018-May-31

The Dallas Mavericks and Lympo, a blockchain app which motivates people to exercise and be healthy, are announcing today a multi-faceted partnership that includes a practice jersey patch and the renaming of all Mavs practice facilities. Later this year, the Mavericks and Lympo will unveil the rebranded Lympo Training Facility and the Lympo Training Court, as well as new practice jerseys featuring the Lympo logo. In this three-year deal, the partnership will also include the creation of a new Mavericks Fitness Team and future integration of Lympo cryptocurrency tokens in Mavericks blockchain initiatives, including an option to purchase tickets.

Lympo was founded in 2016 as a platform to encourage and incentivize healthy lifestyles across the globe. Lympo is developing a blockchain-based ecosystem that will integrate a community of users, personal trainers, gyms, fitness apps, wellness businesses and health insurers. Lympo also leverages the exploding popularity of wearable fitness devices to record activity and enables users to earn tokens for staying active.

“The Mavericks found clear alignment with Lympo’s mission to create a healthier world by utilizing the latest technology to encourage fitness and healthy living in a whole new way,” said Mark Cuban, owner of the Dallas Mavericks. “Through the platform, fans will be able to earn free tickets and merchandise by completing Mavericks fitness challenges on the Lympo app. We are eager to launch this fall.”


Ulta captures the frequent buyer with its loyalty program

Cosmetics are becoming a "super consumable" with enthusiastic shoppers buying more often and trading up to more expensive products as they enjoy the extensive customer service available at brick-and-mortar stores like Ulta. Ulta is also making sure the online channel is available in-store, enjoying major growth on mobile device orders. Finally, they have figured out how to leverage the gift-card connection, distributing gift cards to those retail racks we see in the grocery store. 

RIS News: Ulta Solves the Loyalty Puzzle, 2018-Jun-4 by Tim Denman

With over 28 million active users, Ulta has a massive opportunity to track, analyze, and gain actionable insight from its loyalty program. The retailer is investing in its AI capabilities in this key area to further personalize the experience for its shoppers.

Ulta is doing a great job converting casual shoppers into loyal brand fans, fueled in part by its exploding gift card business ― gift card sales increased 45% in Q1. In 2018, the retailer plans to add another 15,000 partner locations to sell its gift cards, a key initiative since the sale of the cards is “driving significant incremental sales and margin dollars,” Dillon says.

Quartz: The one retailer that Amazon can't seem to destroy is in cosmetics, 2018-May-28 by Helen Edwards & Dave Edwards

Ulta Beauty is described as “one of the best growth stories in retail” by UBS, which sets the market for beauty products and services at $139 billion in 2017 and growing. It is growing even as Amazon aggressively expands, powered by a combination of new store openings, exclusive product selection, and a successful loyalty program that supports e-commerce and prestige purchasing. The company also just cracked the Fortune 500 list, securing its place amongst the country’s most successful companies.

Refinery29: Ulta's Revamped Membership Program is a Beauty Lover's Dream, 2018-Jan-4 by Samantha Sasso

As far as loyalty programs go, Ulta Beauty's is among the best. If you're willing to cash in those catalog coupons every month, you might as well earn some moolah while spending half of your paycheck on mascara and luxe shampoo bottles.

Coresight Research: Beauty Loyalty Programs: Sephora Vs. Ulta, 2017-May-5

ULTAmate Rewards: Ulta’s Ultamate Rewards program features value-related rewards, such as points for discounts and extra points accrual for higher-tier members. Indeed, most of Ulta’s customers cite price and promotions as reasons they shop there, according to Prosper Insights Monthly Consumer Survey. 



Kohl's explains new loyalty program to customers

Actually, the new program is still in pilot, but we're very impressed with the clarity and timing of this announcement. Kohl's is committed to sharing their reasons and plans with their customers. 

Kohl's press release: Kohl’s CMO Greg Revelle Reveals the Future of Loyalty: Kohl’s Rewards, 2018-5-22 

Why change a good thing? We listened to our customers, who gave us a challenge: they asked for more savings, made easier. With this input, we set out to evolve our loyalty platform to make it simpler, more convenient, and bring greater value. We developed our next evolution loyalty program – enter Kohl’s Rewards.

Kohl’s Rewards unifies our three best-in-class loyalty programs – Kohl’s Charge, Kohl’s Cash and Yes2You Rewards – into one platform based on the power of Kohl’s Cash.... 

We also heard customers hate when they don’t redeem their Kohl’s Cash. We want to provide every opportunity to use it. We will automatically keep track of customers’ Kohl’s Cash in the Kohl’s app and will remind them at the register of their Kohl’s Cash balance to ensure they never miss an opportunity to redeem what they’ve earned.... 

Kohl’s Rewards is coming to eight markets – approximately Kohl’s 100 stores – the week of May 21st. During the pilot, we will test, learn, and identify what resonates most with our customers and our Kohl’s associates. We will continue to fine tune the experience to deliver the most compelling program to all of our customers when we roll out the program nationwide in 2019. 


How zulily harnesses both people and data to drive customer loyalty

With Kevin Saliba of zulily we see amazing, aggressive execution of the 'new basics' of marketing: 

  1. Know why customers stay
  2. Employ and support people who love your customers
  3. Use hard evidence to decide what's working
  4. Innovate constantly.

Retail Touch Points: Exclusive Q&A: How zulily Grew Its Customer Base 22% In 18 Months, 2018-May-23 by Glenn Taylor

Data and hard facts are important in marketing, but there are also elements of “art” involved, according to Kevin Saliba, SVP of Marketing at zulily. The retailer seems to have found the right mix of science and art: zulily has made significant strides to widen its base and foster more recurring buyers over the last 18 months. Since Saliba took over the position in January 2017, zulily has increased its customer base 22% to 6.1 million active customers, while growing its private label credit card membership to 160,000 accounts.... 

[Salida:] "When I took over the marketing role here, I really wanted to make sure that we were customer-obsessed. Delivering the right message at the right time to the customer was important. We’ve done a lot of work on the back end making sure that we have the right analytics in place and data available, so that we can optimize and tweak. The goal is for the customer to get the best message at the right time.... 

It’s really a cross-collaboration effort. We have one team that’s focused on acquiring the customers, another team focused on retention and the lifecycle of those customers, and another team focused on the brand and creative. It takes the entire team working together in harmony to see success.

We’re launching over 100 events a day, and we have more than 9,000 different SKUs. The average Costco has around 4,500 SKUs, so we like to say we’re launching two Costcos a day. It’s probably similar to the newspaper industry in that we start from scratch every day. With that much activity going on, it’s even more important that everyone’s collaborating and working together. "