Month: April 2017

The Hour of the Underdog

Robert Borneff Marketing , , , 0 Comment
The Hour of the Underdog

Successful, well-managed companies are excellent at developing and improving their products and services, so that they perform  exactly according to the customers’ needs. These companies listen carefully to their customers and everything that may not please the customer is rejected.

Professional market research, good business planning and proper execution of the plan are cornerstones of good management.

Successful companies grow continually to maintain their share prices and to create new opportunities for their employees. To maintain that growth the focus is on large markets that promise a maximum of revenue.

Sounds good! Doesn’t it? There is only one problem. Large and well-managed companies are often good in developing and improving products that already exist. This can be for example a recliner with even more motion functionality or a softer rug or faster closing window shades.

But what about products that are new on the market or not even invented yet. What about products that are currently only sold in niche markets? What about products that provide a lower margin than the mainstream products? For example a recliner with integrated butler to operate the TV remote and provide drinks; a self-cleaning carpet or grocery bags that dissolve into air after 48 hours of use.

It turns out that big companies are often only good with sustaining technologies, meaning already existing products. Regarding new or different products these companies often fail. The reason for that is, that the same management practices that made these companies to industry leaders also make it extremely difficult for them to work with disruptive technologies. This is the conclusion of Professor Clayton Christensen in his book The Innovator’s Dilemma.

So, What’s the Big Deal?

Read more

Warning: Contagious!

Robert Borneff Marketing , , , 0 Comment
Warning: Contagious!

Watch out! Don’t get too close! This is CONTAGIOUS! Is this about a disease or germs or anything like that? No! Not at all! It’s about ideas and products and a great book that describes why some things become very popular and others die before anyone notices.

Jonah Berger explains in his book Contagious that there are 6 STEPPS that make things popular or go viral on the internet. See how you can use them for your messages.

Read more

Reinventing Retail and Design

Robert Borneff Marketing , , , 0 Comment
Reinventing Retail and Design

Retail is changing! In her blog post on June 6, 2016 Jennifer Marks with Home &Textiles Today quotes the last WSL Strategic Retail Survey (”How America Shops Mega Trends”), that 55% of women said their top spending priority is paying off dept, followed by saving (48%) and vacations (35%). Jennifer Marks concludes consumers are losing their interest in accumulating “stuff”.

On the bright side Deloitte found out (Retail Volatility Index 2016), that small and mid-sized retailers are taking market share away from traditional retailers (also see Disruption in Retail). That’s mainly because small retailers can offer niche products and experiences that big retailers can’t offer. These small companies are well informed, prepared and adaptable, so they stick out from the competition.

I was blessed to be able to attend the opening session of the High Point Market in spring 2016 with Polly LaBarre (The Mavericks at Work) discussing “Reinventing Retail and Design”. Polly described in her sweeping half hour talk what it takes to make a difference. The following are her key points of her presentation:

  1. Stand for something

Successful companies differ from the competition in their core values. Some may be specialized on a certain product group others may serve a certain customer group but every company has a mission and values which it stands for.

  1. Do they work of art

Successful companies develop their strategies together in a bottom-up atmosphere. It is an open and honest discussion where all team members participate equal.

  1. Open Up

Successful companies not only have an open working atmosphere (internal),  they are also opening up to the world outside. They are very interested in the opinion of their customers and also take criticism serious.

  1. Lead without authority

Because of the open internal and external atmosphere, hierarchic structures or military style management forms are missing. Everything is in a steady flow. The loss of control is accepted.

  1. Learn as fast as the world is changing

Successful companies know that the world today is changing faster than ever before. Being on top of the development is crucial to maintain the lead long-term.

Certainly this sounds easier than done. But young organisations like Jazzy Jobber don’t have a past to which they are connected too. They are also not connected to expensive inventory or other assets like buildings and machinery. There are also no management structures that could block future development. These are only a few advantages that give organizations like mine a little head-start. Time and effort will show how to benefit from it.

Source:

The next big idea; Jennifer Marks; Home&Textiles Today; 2016

 

 

7 Types of Multi-Channel Customers

Robert Borneff Marketing , , , 0 Comment
7 Types of Multi-Channel Customers

Customers are enthusiastic about shopping, independent of where they go to. It can be the Internet shop, the social networks or in the brick and mortar store.  With consumers increasingly becoming more experienced with the internet, retailers need a solid “cross-channel” strategy. The search for product information, the sales initiation and the sales incentive often take place in other channels than the actual purchase.

Retail of tomorrow means that one thing cannot be done without the other. While some of the customers are happy to receive in-house advice and then shop online, other customers inform themselves online and then buy in the brick and mortar shop. In addition, very often the Internet helps to find the best offer.

This development offers many opportunities for retailers. Companies should find out how to reach their target customer with different sales channels to gain new customers and keep them loyal  in the future. An important part here is the emotional connection of online customers with their favorite online shop.

But who exactly is the customer who buys through these different channels? Roland Berger Strategy Consultants , has specified the following purchase types:

Read more

Disruption in Retail

Robert Borneff Retail , , , 0 Comment
Disruption in Retail

For a long time the advantage of leading retailers was their size. They were able to buy goods cheaper, because they bought large volumes. They had lower overhead costs because they operated many stores with centralized structures. They had large marketing budgets to run expensive advertisement with a lot of it on TV. Their sales were continually rising.

But suddenly the party was over. Much smaller retailers are snatching away market share from the big guys. According to an article in the Economist, large consumer packed companies (CPG) lost 3% market share between 2011 and 2015. What happened?

Why small retailers gain market share

  1. Online marketing is much cheaper and reaches more and more people. At the same time people are watching less TV. The advantage of big marketing budgets is declining.
  2. Through outsourcing of the production and online distribution, it’s easier for small companies to enter the market.
  3.  Small companies are often more flexible and understand better to keep up with the pace of their fast changing customer preferences.
  4. Consumers willing to spend more for a certain product tend to prefer smaller brands. Traditional big brands are the shops for basic, cheap products. According to Deloitte one-third of American consumers, would pay at least 10% more for the “craft” version of a product.

The Need to Change

All this has provided a big opening for smaller firms. The retail industry seems to enter a new world. Now there are multiple opportunities to navigate around the competition for brick and mortar stores as well as online shops.

The key for retailers to take advantage of these opportunities is to be brave enough to put everything aside that was once important and rethink and redefine the business completely. Last month Target announced that it will commit more than $7 billion to adapt to the rapidly evolving customer preferences. Everything from pricing models and store design to the retail experience and customer relation needs to be questioned. Standing still is not an option and boldness in this marketplace will be rewarded. Jazzyjobber will be part of this journey and welcomes everyone to join in.

Source:

  1. Invasion of the bottle snatchers; Economist 2016: http://www.economist.com/news/business/21701798-smaller-rivals-are-assaulting-worlds-biggest-brands-invasion-bottle-snatchers
  2. TargetCorporate,  February 2017: https://corporate.target.com/article/2017/02/financial-community-meeting