No Turn On Red

Imagine it is Friday at 5:00PM and someone just posted, on their blog, about a horrible shopping experience they had at your store. Maybe a cashier was rude or maybe a store was disgusting - but whatever their frustration, they just posted their thoughts online and now it’s gotten linked to from two dozen websites and now people are talking about it across the country.

In this day, do you really want to wait until corporate PR gets into the office at 9:00AM on Monday morning before someone even thinks about reacting to this story? Monday is too late when there’s the potential that someone, reading the blog post, has decided not to shop at your store on Sunday.

Think it is far-fetched? I talked about this earlier in the year, when one consumer posted about their bad experience at a Kohl’s.

Think something like this can’t happen to your business? I can tell you that no matter how well you think you are training your employees, something somewhere is going to happen and someone is going to talk about it online. The next big story could be affecting your retail chain.

Today I read, over at Consumerist, about an unpleasant experience a person had returning items at Victoria’s Secret. Look through the comments and you will see a range of responses - some agree with the poster and complain about Victoria’s Secret customer service, while some stick up for Victoria’s Secret, while others debate the quality of merchandise Victoria’s Secret carries.

You know what I would love to see? Someone from Limited Brands posting a comment in that thread. Maybe they say that they are sorry for the experience, that they will look into it, and get in touch with the original poster privately. They could talk about how they are going to look into the policy and figure out if the sales person was poorly trained, rude, or even correct in what they do. A personal face of the corporation, being honest and engaging conversation, could stop an already bad experience from spiraling out of control. A personal face who could prevent the same situation from happening again.

This is the role of an online Community Manager: someone who represents a brand, online, and engages in honest communication with managers. It’s not hard to go through blogs, social networks, and community websites to find out what is being said about your brand. It’s not that hard to engage and welcome conversation and criticism. It’s not that hard to admit that, hey maybe someone made a mistake at the store level but it was due to poor training and we are going to correct that.

People make mistakes and they want to see big businesses admit that they do, as well. But a retailing remaining silent and ignoring the conversation around them is going to hurt their business and drive away customers.

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Rundown of things I’m digging, on the web, today, June 5:

This link has made it’s way around the web, but for good reason: New York Magazine has provided a fascinating look into how various businesses are run, and able to stay alive, in New York City. Called The Profit Calculator, this article looks at different levels of retail - from Macy’s Herald Square to a dollar store. What makes them work and where does their profit come from? Love this. [via kottke and Signals vs. Noise]

Does Macy’s Herald Square really get 15-20 trucks a day?

Came across a fairly new blog by the name of Talented Blonde. An experience retail analyst blogging provides for some good reading. Today she shares her thoughts on May store comp numbers, which are due to be released later this week, and her projected winners and losers.

I’ve linked to this Service Untitled before and recommend that you check them out often, too. Positive perspective on customer service and ways you can improve your business. Today they’re talking about working for 99% of your customers, not the 1%.

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Stories that I’ve come across today on the web that I’d like to share:

Originally announced back in August, the Rite Aid purchase of Eckerd and Brooks pharmacy chains is official today. Rite Aid will have to divest certain properties to allow for competition. Conversion of the stores should take 16 months. Once this deal is complete, Rite Aid will be the third largest pharmacy chain in the US (behind Walgreens and CVS) and the predominant pharmacy retailer on the East Coast. More thoughts from the Albany Times Union.

I’ve got to say that I’m sad to see the Eckerd brand go. Part of it is the fact that the Eckerd stores in my area are newer than the Rite Aid locations, making for a more pleasurable shopping experience.

Last week the Motley Fool had a good look at Abercrombie & Fitch, this week they’ve got a good look at J.Crew. They’ve had a succesful IPO, improved their gross margin, increased revenue, and increased same store sales. Good times for that retailer.

Recently, Target introduced a line of wedding dresses and related apparel by Isaac Mizrahi. Today, the Chicago Tribune is talking about this, what it means for Target, and what it means for the industry.

Finally, lux.et.umbra is asking whether summer hours would improve business in Silicon Valley. Good thoughts. The budgets for small retailers is tight, but not being open when your customers want to shop is bad business. That’s not to say that everyone should be open 24 hours, but late hours during the Summer may not be a bad thing.

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New month, new day, new collection of stories from around the web that I am finding interesting:

A reminder that fulfilling promises to customers is important, and no detail is too small: Mike Wagner at Own Your Brand talks about a recent stay at a hotel that may have cost the hotel a $30,000 contract. Retailers, hotels, airlines, whoever is involved in customer service needs to remember that every customer and every detail counts.

Compete Blog looks into the question, What effect does gas prices have on consumers? Detailed looked at the traffic that two gas price watch websites get compared to the rise in gas prices. Are people really as fed up with gas prices as some people (retailers) would like us to believe?

Just how important are personalized e-mails from retailers to customers? Apparently, a new survey says that they are very important. We can’t forget how important e-mail is in the transaction cycle for retailers.

Finally, Customers are Always provides a list of 11 ways to lose customers.

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Another day, another collection of stories on the web that I’ve come across today.

The New York Times has a great look at how Wal-Mart’s own policies and methods have hurt the retailer. Wake Up Wal-Mart asks, Is Wal-Mart too cheap for their own good?

Not too long after Wal-Mart revealed more information on their plans to enter India in 2008 (read more here and here), Marketwatch is reporting that Best Buy is in talks to enter India through a deal with Vivek.

Steve Miller at Two Hat Marketing is talking about return policies. I agree with him that liberal return policies create more loyal customers. While they may create loyal customers who abuse the system, they are outweighed by the loyal customers created who appreciate not being looked at like a thief if something doesn’t fit or they change their mind. Retailers like Nordstrom and Kohl’s are using their return policies to distinguish themselves from their competition.

And finally, some interesting tidbits related to the airline industry:

A customer service tale, of people going above and beyond what is expected, involving the TSA? That can’t be right! But indeed, Christ at The Diff shares a positive story about the TSA that also involves holday air travel. Good story to read.

While The Airline Hub is reporting on a change in United’s policy on delayed flights, maybe United should take a look at Service Untitled’s thoughts on ways airlines could improve customer service.

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Intelligent Entreprise has a quick interview with Best Buy’s Senior Director of Customer Insight, Matt Smith. Good look at how retailers look at all of the channels available to them and how they are trying to understand and better target their customers.

While I believe that retailers need to better look at ways to interact with their customers, using emerging social media technologies, I think that Best Buy’s customer analysis is a good building block. Understand your customers, but interact with them and they’ll tell you more about themselves than you could ever harvest.

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New York Post has some more details about the Circuit City employee who helped tip off the FBI to the Fort Dix terror plot.

The Economist talks about the grocery chain Publix and how it competes with Wal-Mart. Businesspundit has some good comments on the article.

Best Buy’s new flexible schedule for corporate employees and their plan to roll it out to retail operations.

A Consumerist reader has is having problems with the Banana Republic website and gets the runaround from customer service.]

Lots of commentary on Wal-Mart moving into India and their chances of success.

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I like this post over at Flooring The Consumer called Retail Experience and the Human Element. The author goes to three stores in New York City (Apple 5th Avenue, Hershey Store Times Square, and Urban Outfitters 3rd & 59th) and examines the human element at them. This is an interesting look at a side of the retail experience that may sometimes get overlooked in the grand scheme of design.

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This week we saw record heat on the East Coast and a mixed bag of retail results for July. Some retailers are already enjoying the BTS season while some mall retailers can’t catch a break.

Are Wal-Mart employees in for a shock tomorrow? Rumors are that various levels of management, including store, district, and regionals, were tied up in meetings last week discussing new HR policies. Details are few, due to strict measures meant to clog up leaks, but one of the rumors is that Wal-Mart will be announcing new policies regarding the maximum pay employees can make within various pay scales. Is a possible severage package for long term employees also in the works? Rumors are rampant, but expect more to be known tomorrow.

The Lord & Taylor sale has been approved by the Federal Trade Commission. With that, Macy’s has re-opened the former Lord & Taylor in Center City Phildelphia as a new flagship store. The Philadelphia Daily News offers some insight into ways that Macy’s, and other retailers, can look towards the future of retail and customer satisfaction (see: Macy’s: Want to Know The Real Way to Shop?).

In case you blinked, as of the end of July, Hollister now has 355 stores nationally, compared to the 351 that Abercrombie & Fitch has. The younger brother now has more stores than the (much) older sibling.

Finn over at Lightheavyweight took a good look at Gap and some other retailers this week (see: Retail Sightings, July 30, 2006). He comes from a design background, similar to me, and approaches the retail industry looking for good design and ways to increase customer satisfaction. I really enjoyed this post and look for more like it in the future.

In local (to me) retail news, there’s something interesting brewing along Route 36 at the site of a former Bradlees and Food Town, in Hazlet, NJ, that has been vacant since the early part of this century. It appears that the local planning board has heard an application from Stop & Shop Supermarkets to rennovate the building. For years, Wal-Mart has been rumored to be interested in the property, but due to enviromental concerns, the property is not large enough for what they require.

This application is interesting for a few reasons - one, because Stop & Shop owned the Bradlees chain at one point, so they are reaquiring property they divested 15 years ago. Second, Stop & Shop already has a location less than a mile away from this property. I’m interested to know what they plan on doing with this vacant parcel and the existing store. Could they really be moving locations, down the highway?

Also locally, PetSmart is building their sixth location in this part of the Jersey Shore, due to open next year.

This week will see the start of Q2 earnings results, with the balance of the results due in after next weekend. We’ll see how the BTS season is shaping up for retailers across the country and start to get some indications where retailers are planning on going as we head into the Fall.

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Gas prices, conflict in the Middle East, sales tax, rising interest rates, wildfires, foods with too much trans-fat, and hurricanes: we’re almost to the end of the second quarter in retail - anyone want to place bets on which of the preceeding things retailers will be blaming poor results on the most?

This week, it was revealed that Wal-Mart has loosened it’s policy on shoplifting (see: Wal-Mart relaxes no-tolerance shoplifting rules -NYT). This wasn’t a story that was not exactly meant to go public. The New York Times published a story with source documents given to them from the website WakeUpWalmart.com, with some interesting twists (see: CNN Ignores Labor Union Source of Wal-Mart Shoplifting Story). Wal-Mart themselves have publically responded to their public outing by saying “Don’t test it“. The National Association for Shoplifting Prevention and the National Crime Prevention Council have also issued a statement against the change in Wal-Mart policy.

Unfortunately for some, the exemption only applies to first time offenses under $25. You are still out of luck if you’re an off-duty police officer, shoplifting $258 worth of merchandise: not only will you get procescuted, but you will also probably lose your job.

Wal-Mart has brought themselves into a unique position by being the largest retailer in the world. Any- and everything that they do will be scrutinized in the media, even though a move like this simply brings Wal-Mart in line with most/many other retailers.

More coverage from bloggingstocks.com.

Great article in today’s Courier-Post, out of Cherry Hill, NJ, about the lessons that can be learned from the boardwalk in Seaside Heights, NJ: More the merrier in Seaside Heights. In a small area, competition for the same consumer will dictate prices, ideas, and customer service. Truth be told, I think Seaside (like most boardwalks in New Jersey), do a very good job at pleasing the customer and creating an affordable family athmosphere. There are lessons to be learned from the New Jersey boardwalk industry.

I never thought I’d say that there are business lessons to be learned from the same boardwalk that once hosted the MTV Beach House, with Carson Daly and Civ performing tracks off their ill-fated Thirteen Day Getaway.

Took a trip to Old Navy today and saw the start of the new Fall turnaround. I’ll post more about it tomorrow morning, but so far I am very impressed at the new merchandise I got to see today.

Finally, a trip through some blog posts that I enjoyed this week:

First, my new favorite blog is Finn at Lightheavyweight. He’s got great ideas about design, marketing, and business. He also points out some ways that retailers/businesses can learn from punk rock in his post Punk Rock Branding Lessons II. As an avid music fan myself, I think that there is a lot that businesses at large can learn from DIY/punk ethos without co-opting the identity of punk rock. Be honest, put the customer (fan) first, and work hard. Good points by Finn.

Katherine at Chain Store Age blog talks about recent trips to Ace Hardware and Home Depot. Guess which retailer provided the better customer service? Whenever I need something from a hardware store, I consistently get the better value and customer service from the local, independent or smaller chain stores than I do at Home Depot or Lowes. Although I’ve gotten better assistance at Lowes than Home Depot, nothing beats the level of service from the local True Value Hardware Stores.

Finally, as we go into the Back to School season, Ken at Retail Crier offers some advice for retailers looking to better market to younger crowds. Although some retailers are utilizing some of the points that he touches on, retail is still an industry that doesn’t seem to understand how to use technology to their marketing advantage. Forget podcasts - larger retailers haven’t even figured out how to use blogs to reach their core customer. With retail consolidation ruining customer relationships with retail brands, the technology we have at hand is perfect for allowing retailers to connect, one-on-one, with the people they want in their stores. Too bad they just don’t get it.

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