One of our favorite trend reports of the year has been released. Mary Meeker's report covers the internet in its entirety - extending beyond digital commerce. But, as it is where our stores reside, we anticipate and devour the broader market information that Ms Meeker provides. A few takeaways:Read More
The most anticipated slide deck of the year for ecommerce retailers is here. Our key takeaways:
Here are some of our takeaways:
Global smartphone growth is slowing: Smartphone shipments grew 3 percent year over year last year, versus 10 percent the year before.
Voice is beginning to replace typing in online queries. Twenty percent of mobile queries were made via voice in 2016, while accuracy is now about 95 percent.
China remains a fascinating market, with huge growth in mobile services and payments and services like on-demand bike sharing.
While internet growth is slowing globally, that’s not the case in India, the fastest growing large economy. The number of internet users in India grew more than 28 percent in 2016. That’s only 27 percent online penetration, which means there’s lots of room for internet usership to grow. Mobile internet usage is growing as the cost of bandwidth declines.
Wearables are gaining adoption with about 25 percent of Americans owning one, up 12 percent from 2016. Leading tech brands are well-positioned in the digital health market, with 60 percent of consumers willing to share their health data with the likes of Google in 2016.
All 300+ slides are here: 2017 Internet Trends Report
Mary Meeker, legendary Morgan Stanley internet analyst and current partner at Kleiner Perkins Caufield Byers, delivered her annual State of the Internet presentation today (May 28, 2014) at the Code conference in California. The highlights below.Read More
Buyers, brand owners, and sales professionals spend a good amount of time on the road (and in the air). While most in-flight experiences are far from luxury, even in first class, we should all be working to make them a bit more bearable on ourselves.Read More
Moral licensing is a term commonly used in social psychology and marketing, referring to the unconscious way in which we are less conscious of immoral behavior, after acting in a moral way. For example in one study where customers viewed a 40-second video praising their actions, 33.3 percent of those customers bought eco-friendly batteries. Those who saw a similar video, this time praising the company's efforts, purchased the eco-friendly batteries 69.6 percent of the time.
Moral licensing has growing significance in the retail industry today, as more brands focus on sustainable and corporate social responsibility marketing. Maryam Kouchaki and Ata Jami reported for Harvard Business Review that corporate philanthropy reached $18.5 billion in 2015, and cause-related marketing increased to about $2 billion in 2016. In the short-term, if brands and retailers want to effect altruistic consumer behavior, we will use messaging that asks for a commitment to a cause, rather than praising customers for their dedication.
Want to learn more about moral licensing?
Delivering profit plans while executing company strategy requires a talented planning individual. It requires a thorough understanding of how each business metric interacts with one another. Add in cross-functional team buy-in, customer perception, and loyalty, and a master merchandise planner is more than a number cruncher.
To be a great retail buyer, you need to be a master of three skill sets:
- Product selection
- Business management
Connecting the creative aspects of buying with strong business acumen and relationship building skills is key to a successful buying career. It is the buyer’s responsibility to drive sales and profit while simultaneously identifying trends that will be important for the customer.
That's a wrap for this year's #MustHave16 Design Competition, hosted by Art of Fashion.
The competition is demanding of the emerging fashion designers who participate. They are required to submit a sketch and a sample. In addition, they must go through the 5 phases of starting a brand: including building a social following and marketing strategy, working with retailers to ensure their design meet customer's needs, and selling their design in-store.
"It is a challenging competition, but it is a challenging market for emerging designers", says Jennifer Pilkington, Managing Director of Retail Assembly, who is a competition sponsor. "The hard work pays off, as the designers have a real world toolbox at the end of the competition."
This year the competition offered mentorship and feedback from a variety of industry experts including Laura-Jean Bernhardson, CEO of multi-store retailer Fresh Collective, Elle Bulger of Pinch Social, Jennifer Powell of Hart and Galla, and Donna Bishop, founder of Green Beauty and FGI Board Member.
Browse the video playlist below and congratulate our winner Bulgun Puteeva of Bulia.
Uber's head of Economic Research and former economist at Yale, Keith Chen sat with NPR's Shankar Vedantam to talk about dynamic pricing and behavioral economics. This is a must listen for every merchant, buyer and product / brand manager who touches or thinks about pricing.
Gadi BenMark and Maher Masri wrote a beautifully detailed guide for breaking down your digital's shopper from journey to their preferences. We recommend this read for your digital marketing teams. Topics covered include:
- Customer decision journey's
- Digital-channel preference
- Product affinity
- Response to offers
- Life moments and context
- Demographics, preferences, and needs
Summarized and excerpted from the December 2014 article by Liz Ericson, Louise Herring, and Kelly Ungerman, "Busting mobile-shopping myths".
- APPS ENGAGE YOUR BEST CUSTOMERS - not generating traffic to engaging new customers. "As the number of shopping apps proliferates, many people seem reluctant to use them: barely 30 percent of mobile shoppers have more than two shopping apps." and survey respondents were twice as likely to visit a mobile site than an app.
- BASIC FUNCTIONALITY IS MORE IMPORTANT THAT FEATURES - "Respondents said the three most important functionalities were smooth checkout, the ease of adding and dropping items from a basket, and site navigation."
- SHOWROOMING CAN BE POSITIVE - A customer showroom in your store will buy from you eventually - 58 percent of them do.
- DIGITAL DEVICES SUPPORT IN-STORE SERVICE - "Shoppers view mobile-enabled sales assistants—particularly in showrooms and large-format stores—as enhancing the shopping experience, underlining the need for retailers to find and train motivated, well-prepared, and well-equipped employees."
EXCERPT from Brian Hartmann, William P.King, and Subu Narayanan's August 2015 article in McKinsey, "Digital manufacturing: The revolution will be virtualized"
Leading consumer-packaged-goods companies are using digital tools to improve distribution and build bonds with consumers. Global fashion retailer Zara is already renowned for developing and shipping new products within two weeks. It is now using digital tools to respond even faster to consumer preferences and reduce supply-chain costs, attaching reusable radio-frequency identification (RFID) tags to every item of clothing in more than 700 of its 2,000-plus stores. Ten staff members can now update a store’s inventory in a couple of hours—work that used to take 40 employees more than five hours—by waving small handheld computers at racks of clothing. The retailer expects to complete the shift to wireless inventory in 2016. We believe the falling costs of RFID hardware and associated software are likely to aid this transition.
Addressing how they are supporting Bangladesh development, H&M produced a fairly well-rounded video. With all of the coverage on the much needed improvements to working conditions, the economic and developmental impact is often left untouched. It is this development and international investment in the country which is why organizations should continue to push for improvement in the lives of their workers.
It is a one-sided perspective, but it includes a variety of initiatives:
- Wage growth
- Skills training and upgrades
- Improved employee - management relations
What is missing, but perhaps not within the context of this video, is the environmental working conditions - exposure to toxic materials, chronic pain and ergonomic initiatives, etc. But overall, it was nice to see an organization addressing specific measures in a fuller way - not simply speaking about the cheque they cut in light of the tragedies.
Forbes Staff Writer Katia Savchuk recently wrote about the rewards of pursuing that art school degree you've thought about. It may be worth it for career progression and financial gain.
“There’s a ton of evidence that prospects for graduates from art schools today are better than they’ve ever been before in terms of income, their ability to survive economic turbulence and their preparedness for the job market of the 2020s,” says Columbia University professor Jennifer Lena
The globe's favorite (American) public broadcaster, NPR, launched a Kickstarter campaign and made 25,000 t-shirts to follow it's journey. An increasingly popular notion (see H&M's efforts, and Patagonia's transparency about their supply chain), NPR's report paints a very clear, visual picture. Videos, charts and graphs, and even photos of how different threads are spun are interesting to browse.
Whether or not you have an interest in apparel product management or product development - it's is an interesting series of videos and supporting podcasts. Visit npr.org/shirts
As Alibaba and US Retailers look to bring Black Friday to China, and is on track to be the largest ever for the United Kingdom. But we are feeling nothing but weariness for the event, and the value it actually provides to our customers. Here's why:
Laura Shin recently reported in Forbes that 55 percent of American’s plan to skip Black Friday. The ‘holiday’, with crowds, long line-ups, and competitive shoppers does have a hard-core customer base. One in five shoppers report they have never missed a Friday. And they are willing to wait in line ad average of 2.5 hours. Nothing says 'customer service' like a 2.5 hour wait.
“The Thanksgiving-less shoppers in places such as the U.K., the Netherlands, and Canada spend more than Americans during the holiday season, Adobe research found, despite the absence of a Black Friday starting gun to ignite the shopping.”
The retailer’s transformational strategy will woo more shopper dollars this holiday season
Canada’s large retailers are cautiously optimistic this holiday season as average growth in last 4 months remains at 3.0 percent over the previous year. The growth headliners of late (either to the positive or negative) are seemingly tapped for new ideas that will produce significant gains. There is one exception, Indigo Books and Music, which in the last two quarters has shown they are wooing more shoppers and shopping dollars back into their stores.
Indigo Books and Music achieved Q2 sales of $189 million and comp store growth of 8.4 percent – higher than any one else on the list. Comp store sales are a key performance indicator as this measure excludes sales fluctuations due to store closings, permanent relocation, and chain expansion. In Indigo’s case, operating 6 fewer stores helped to increase its revenues in existing stores. The company’s 90 superstores generated a total 6.0 percent increase (9.6 percent comp increase), while the smaller format locations attributed 2.3 percent revenue growth.
Heather Reisman, CEO, indicated in a conference call November 5 that there are no plans to further decrease the number of Superstores that are driving the company’s business – but there is a possibility of expansion.
Small stores growth is driven by individual opportunity (i.e. expanding paper category where successful, adding toys where there isn’t competition in the mall, etc.) they aren’t yet part of a larger transformation strategy. With 2.3 percent revenue growth, it isn’t something to be worried about yet.
There are two indicators – beyond the strong comp store growth – that are promising for the retailer.
1) The transformational strategy is working. The cornerstone is transitioning itself into Canada’s cultural department store, and growing the general merchandise category is key to achieving this. Now at 27 percent and expanding, general merchandise is picking up some of the slack books left behind.
2) Core books showed great growth, despite the industry’s declining results! Anytime a retailer can continue to grow their core, it means positive results. Teen and children’s books are current driving forces.
The cautious approach Reisman takes, despite recent success in a difficult transformation is working. “As I say in every one of my meetings, we still have a long way to have to go to fully achieve what we think the potential is of the business“ she commented on the call.
The team at Indigo has been diligently working over the last few years to execute. The design studio in New York brings proprietary accessories and lifestyle home products to the stores each season. The retailer has sought and invested in the best talent. Indigo remains alert, and are beginning to see success while the rest of the industry sees only modest growth. Keep your eye on them in the third quarter.
Wishing everyone strong holiday sales.
READ MORE | Holiday business set-up (Canada)
Canada’s large retailers are cautiously optimistic this holiday season as average growth in last 6 months remains at 3.0 percent over the previous year. And the industry’s largest commodities are close to flat. But it isn’t all lackluster news – men’s, sporting goods, toys, and footwear all saw significant growth for the year. A set-up of what to expect from the nation’s news-making retailers this year:
There is room for another entry-level general merchandise chain to compete with Walmart. Target has a bit more to do to get things right.
Third quarter comp store sales were up 1.6 percent, looking at just the stores that were open at the same time last year. These results come as the retailer adjusts to the true consumer demand, which is no longer affected by higher-than-normal launch appetite, and sales shifting to new locations. Both are inevitable when opening a lot of stores in a short period.
With strong partnerships across categories, including TOMS, the results for holiday may be good. Pricing, distribution and allocation adjustments have been made. Target may just start to build traction this holiday season.
The turnaround story that isn't
Both Sears and Best Buy are turnaround stories that just haven’t gained momentum. At the end of its third quarter, comp store sales had declined another 9.5 percent at Sears, and Best Buy Canada continues to drag on its US parent.
Product tweaks aren’t doing as much for the retailers as needed. – and neither seem to moving the dial quickly enough on key opportunities.
Hudson’s Bay has formed (and purchased) some strong partnerships to increase traffic in-store, and move its brand forward in the minds of consumers: Topshop, Saks, and the Drake General Store. Adjustments made to its owned business have had a smaller impact in the customers mind (with the exception of The Room).
Comparable store sales in HBC’s Department Store Group (Hudson’s Bay and Lord and Taylor) grew by only 1.1 percent in the last quarter. Most business are dragging at the retailer, with bright spots in smaller categories men’s, home and cosmetics.
The retailer will continue with it’s one-day sales this holiday – hoping that consumer fatigue or competition for the promotion will not hinder its success. Humming along at about the same pace as the industry, we may not see exceptional results from the retailer. The excitement and growth seems to be from the US, Saks OFF Fifth grew by almost 15 percent last quarter.
An unexpected bright spot
The team at Indigo has been diligently working over the last few years to execute on their transformational strategy, remain alert, and are beginning to see success while the rest of the industry sees modest growth.