If you have been watching the Olympic Games in London, your eyes have been trained on peak performances taking place in world class venues. Watching such great swimmers as Michael Phelps, Ryan Lochte and Missy Franklin perform at the Olympic Park Aquatic Centre has been a real treat. While worldwide television audiences tune in to watch these compelling races, they also see an important element, but rarely give it any thought.
A small company in Ohio is responsible for making the racing lanes being used in London. In fact, they have supplied the lanes to nine different Olympics starting with the 1968 Mexico City games. It is interesting to note that these lanes are designed to not only divide the pool, but also help to quell the wave created by the swimmers.
There is a strong parallel that can be drawn between these racing lanes and the services provided by the members of NARMS. Everyone who walks into a Target or a Kroger store sees what the members of the at-retail merchandising and marketing service industry do, but rarely notice it. They are the invisible visible force at retail.
Visible in that the results of high quality, professional in-store execution of sales building promotion and operational initiatives are immediately noticed by the shopper, the store manager and the brand. Invisible because the purveyors of this are really only noticed if these activities do not happen or if something goes wrong.
Our activities have always been important, but may be even more important now that a missed step can be picked up on by consumers on social media and can create a wave that can damage brand and market share. The members of NARMS have been dividing the lanes and calming the waves at retail for years.
The National Retail Federation (NRF) has released their Hot 100 Retailers list that can be viewed in the August edition of Stores Magazine. The story features a link to a sortable chart of retail companies that reported the greatest increase in domestic sales between 2010 and 2011.
As with most ranking lists, some strong trends did emerge. The drivers for the companies who made this annual list appear to be organic food, high-end trendy fashions and e-commerce enhanced by mobile technologies.
Sprouts Farmers Market takes the number one spot and underscores the importance of organic foods in food retailing. There are 20 supermarket chains that made the chart including Lowe’s Market Place, Kroger, Whole Foods Market, Trader Joe’s, Aldi, Publix and H-E-B.
Upscale, high-end fashion chains took up three spots in the top 10 lead by Michael Kors at number three and followed by Lululemon Athletica and Under Armour. The common denominator among the three is an ability to create a brand image that is not dependent on price promotion.
Four retailers in the top 10 fall into the mobile technology and e-commerce camp. Verizon Wireless comes in at number two on the list, Apple is at number nine and AT&T is at number 10. Amazon, who sells a wide variety of technology and content, is number seven on the list.
The Stores Hot 100 retailer list from NRF makes a great tool for members of the at-retail merchandising and marketing service industry who provide the kind of in-store support that help these companies grow. To dig deeper into the list, click here.
For several weeks now, leading indicators of retail sales have been prognosticating a healthy back-to school (BTS) season, over and above the sales results from last year. Back in late June, we reported on a Price Grabber survey that said 46 percent of shoppers plan to spend more this year. Two more sources came out with news this week to support the optimism.
A story in DSN Retailing Today reports on an NPD study that says, although spending will be later than usual, 31 percent plan to spend more than they did last year. Only 22 percent made that claim a year ago. NPD attributes the later shopping pattern to the warm weather throughout the country. In their study, 37 percent said they will finish BTS shopping by August 1 and 58 percent said that would take until September 1. Department stores will see a big bump with 26 percent of the spending done there, 26 percent at footwear stores and 16 percent online.
The National Retail Federation (NRF) also came out with predictions for the season. They say the average consumer with kids in grades K-12 will spend approximately $85 more this year on their children for the BTS season. BTS spending will reach $83 billion which is the second highest spending event for consumers behind the traditional winter holidays. As far as where those dollars go, NRF says that $264 will be spent on clothes, $217 on electronics, $129 on shoes and $95 on school supplies. They too predict purchases will be more spread out throughout the summer.
The lengthened BTS season means a couple of things to at-retail merchandising and marketing service companies. Out-of-stocks will be a challenge in key BTS categories. Better sales will mean more price and promotion competition and thus more in-store promotional materials and displays. There will be an added focus on the department, shoe, apparel and electronics channels. Talk to your retailer and manufacturer customers now about their ongoing at-retail BTS challenges and needs.
More and more items are popping up in the trade press addressing the phenomenon of Showrooming. At one time the showroom meant a place to go kick the tires on a new car or perhaps see some furniture or a bedroom set as they would appear in your own home. But Showrooming in the present tense means something quite different. It is now a consumer behavior in which shoppers use their mobile phones in physical stores to compare prices, scan QR codes and read online reviews while they check out the product. The consumer then uses the smartphone to order online or go to the store with the best price.
A recent column on Mashable takes a look at an Empathica survey of 6,500 internet users, half of which are smartphone owners. The column also includes an interesting infographic. The findings of the survey are stark. Fifty-five percent of the smartphone users said they use their mobile phone to compare prices, 34 percent scan QR codes and 27 percent said they read online reviews.
How are retailers reacting? Some are embracing it by offering promotional incentives for checking in or scanning merchandise. Others are trying to prevent it by removing barcodes to prevent scanning and price comparisons with other stores. Either way, this has become a very real issue for retailers and their manufacturer partners.
For members of the at-retail merchandising and marketing service industry, Showrooming is a consumer behavior that needs to be monitored. More and more, our trading partner customers are going to be dealing with the phenomenon that appears to be part of the new normal for shoppers. No matter what the response is, in-store execution of merchandising strategies will play a major role in embracing the reality.
The last few weeks in retail news have seen some troubling developments for iconic retail chains in various channels. Best Buy, JCPenney, Supervalu and the Tesco Fresh & Easy concept are among a group that is struggling to maintain market share and profitability as shoppers exercise a dramatic shift in behavior. Two reports released this week by Capgemini and ShopAtHome.com underscore some trends that drive the behavior. The big picture is that consumers no longer differentiate between the at-retail and online experience and are attracted by retailers and manufacturers who are seamless in integrating a multi-channel approach.
The Capgemini report surveyed 16,000 digital shoppers worldwide. More than half of the respondents expect physical stores to take on more of a showroom role as shoppers use them to see and feel the product, but then buy online. But it does work the other way. More than half also said they are more likely to spend more money in the physical store if they used digital channels to research products prior to the trip.
According to the ShopAtHome.com study, consumers are becoming increasingly more dependent on the retailer to carry the promotional message online. The report says that 62 percent of shoppers who use their site search online for store-centric deals, 24 percent for product specific promotions and 14 percent for brand name product discounts.
These two pieces of research suggest that the retailers and manufacturers who successfully remove the gap between physical, digital and mobile retailing will emerge as the big winners. Shoppers are telling us that they want complete integration in the way that they now shop.
For members of the at-retail merchandising and marketing services industry, it is important to stay on top of these trends so you can hear the challenges faced by your retail and manufacturer customers and act as a conduit to a seamless merchandising approach.
Another piece of research appeared this week having to do with the impact of game changing buying groups. The Trouble in Aisle 5 joint study by Jefferies, a global investment bank, and AlexPartners finds that traditional food-at-home, which is already facing trouble, is likely to see its challenges accelerate over the next few years.
The findings are based on a survey conducted in May of 2,000 adult grocery shoppers over the age of 18. One thousand of these shoppers were across all age ranges, and an additional 500 Millennials aged 18-31 and 500 Baby Boomers aged 48-66 were included.
At the heart of the oncoming challenges is changing demographics. The study cites U.S. Census Bureau projections that Millennials over the age of 25 will make up roughly 19 percent of the U.S. population by 2020, up from just over 5 percent in 2010. Household spending for this group is expected to raise more than $45,000 from just over $28,000. Food-at-home spending by Millennials is set to jump by $50 billion annually through 2020. Baby Boomers, on the other hand, are expected to decrease food-at-home spending by up to $15 billion.
This transition is expected to bring about a shift in buying patterns. Millennials are far less dependent on brands. Twenty-three percent are less likely to value food brands when making buying decisions and 18 percent are less likely to shop at traditional grocers.
According to AlexPartners, the shift will require increased flexibility and an even more intense focus on the consumer for established food manufacturers and retailers. No doubt, the same requirements will be needed from the at-retail merchandising and marketing industry if we are to help our clients find innovative solutions and growth in the challenging times ahead.
The members of NARMS, professional at-retail merchandising and marketing companies, are adept at helping retailers and manufacturers fill their shelf space at various channels around the world. The advent and widespread use of e-commerce and social media has provided another challenge for trading partners. There is a now a digital shelf space that needs to be filled and monitored. The June issue of Competitive Edge by Willard Bishop does a nice job of breaking it all down and provides and analysis of who is doing this well among top 25 food retailers.
It is important to understand how trading partners are engaging in digital and social media sites. According to Competitive Edge, trading partner uses and consumer interest in these sites are in very close alignment. Of course manufacturers and retailers use e-commerce, but here are their reasons beyond selling: advertising and promotion, public relations, customer service, market research and product development. For consumers it is much the same: search for coupons and deals, seek advice, identify with brand, feel connected and seek customer service.
There are two very important and equal components to most digital and social media approaches. The first is the obvious outbound marketing and advertising campaigns. The not-so-obvious, but opportunity rich component is in a social media monitoring campaign. An active monitoring campaign can provide many customer service opportunities and shopper data information.
What is the tie-in with at-retail? With trading partners being so engaged in digital and social media, it is even more important that their physical spaces be in compliance with their on-line position. Many of the initiatives that you are performing for clients right now may be in direct connection with social media monitoring observations or patterns. Not to mention the ramifications of bad on-line reviews from customers.
How is your company helping its customers fill and merchandise the digital and social media shelves? It is an analogy worth thinking about.
Building on last week when we reported information from both the U.S. Commerce Department and the National Retail Federation, more information came out today that predicts a healthier future for retail and the economy. A story from DSN Retailing Today reports that back-to-school spending is projected to be higher than last year.
According to a PriceGrabber survey, 46 percent of shoppers are planning to spend more than they did last year and 35 percent said they are planning to spend the same. Only 19 percent said they plan to spend less. This is compared to 35 percent who said they planned to spend less in 2011.
As was the case a year ago, shoppers plan to spread out these purchases throughout the summer. Seventeen percent will start shopping for back-to-school in June, 35 percent in July and 44 percent said would wait until September. This continues a trend of consumers stretching out the shopping season for major holidays and shopping seasons. According to the story, it is a reaction to a continued desire to take advantage of retailer promotions and discounts.
The signs point to seasonal sections and displays getting set-up earlier and earlier. It puts an emphasis on roll-outs and new product introductions as retailers and manufacturers capitalize on the trend and seek the sales lift sooner.
For the members of the at-retail merchandising and marketing service industry, there is an opportunity to provide the solution as trading partners will want to talk about these initiatives sooner and perhaps want to cut down on the amount of time allowed to execute. Look for speed to shelf to take on a new and heightened importance to your customers.
Both the National Retail Federation (NRF) and the U.S. Department of Commerce came out with May retail sales figures this week. The results are not overwhelmingly positive, but according to a story in DSN Retailing Today, it all depends on how you look at it. As the story points out, retail is the first industry that truly experiences how consumers are feeling about the economy and there seems to be signs of hope.
At first blush, it seems consumers have slowed their spending. The NRF reports that May retail sales have dropped 0.3 percent seasonally adjusted from April. However, they have increased 4.8 percent unadjusted year-over-year making 23 months of consecutive growth. The Commerce Department tells the same story reporting May retail sales down 0.2 percent adjusted compared to April, but up 7.1 percent unadjusted year-over year. The NRF number excludes automobile, gas and restaurants while the Commerce numbers include these things.
The NRF says that they are encouraged by the numbers and that consumers are taking a breather from strong first quarter spending. They expect retailers to be cautious with inventory and promotions ushering in a huge back to school season. Back to school is traditionally the second biggest time of the year for retail.
Here are some others highlights from these economic reports. Clothing and clothing accessories sales increased 7.3 percent year-over-year. Electronics and appliance sales increased 1.2 percent. Furniture and home furnishing sales increased 11.4 percent. Health and personal care sales increased 3.1 percent.
It is always helpful for members of the at-retail merchandising and marketing industry to keep our fingers on the pulse of economy as our customers, retailers and CPG manufacturers, are on the front line and feel the impact first. It is the best way to anticipate and plan for their ongoing service needs. You can read the DSN Retailing Today story by clicking here.
Another exciting week at NARMS as the Association for at-retail merchandising and marketing service companies announced that Rhonda Bauer will be coming on board as the new Senior Director of Marketing and Trade Relations. Bauer will have primary responsibility for the ongoing marketing and branding of NARMS International and will provide valuable counsel and support to Executive Director Tom Caddell.
Bauer comes to NARMS with as strong track record for developing fully integrated strategic and tactical marketing programs and campaigns. Bauer is an accomplished senior marketing executive with extensive experience in branding, marketing, advertising and public relations. Twenty plus years of agency leadership honed her skills as she developed and implemented results-driven marketing programs for national corporations, regional companies and entrepreneurial, family-owned businesses.
She has been actively involved with numerous organizations, including SIFE (Students in Free Enterprise), IFA (International Franchise Association), AAF (American Advertising Federation) and many other local associations. Bauer has published more than a dozen articles and her marketing contributions are broadly represented in many facets of the consumer goods and services arena.
Among her many duties at NARMS will be to develop and execute a comprehensive marketing plan that measures and evaluates the value and return of NARMS resources to the members and the industry. Bauer will develop Association communications, public relations and trade relations with the goal of advocating for the increasingly high standards of the at-retail service industry and its individual members. She will also be the primary liaison between the Association and the Independent Food Brokers (IFBA) division.
You will be seeing and hearing a lot more from Rhonda in the weeks and months ahead. In the meantime, you can reach her via email at: firstname.lastname@example.org. She will be located in Colorado at the new NARMS headquarters at NARMS International, 2095 West 6th Ave, Suite 213#, Broomfield, Co 80020. The new headquarters will officially open on July 1.