Wednesday
August 15, 2007
Good post this morning over at Retail Design Diva talking about how retailers are using Facebook to capture the Back to College crowd:
Students can take a quiz to discover their “decorating style” and (ta-da!) receive a list of products they can buy at Wal-Mart that best reflects their style, and their roommates’, of course. How smart is this?! Students can also search Wal-Mart’s Web site for eco-friendly products or download a shopping list of dorm room pieces. The hip, new items can then be shipped directly to the school (no furniture hauling for dad), making life a lot easier for parents and kids. And let’s be honest, mom and dad are going to be all over that, even if they don’t have a Facebook account. This idea is absolutely brilliant–and I don’t even shop at Wal-Mart.
In a world of Facebook, MySpace, LinkedIn, YouTube and a variety of social networking and media sites, retailers could benefit substantially from plugging in. Securing teen and college kids’ dollars is extremely lucrative. Connecting with them on their own platform is invaluable. Apparently, Wal-Mart did its research, because according to the National Retail Federation, the average first-year college student spends $1,112.62 on back-to-school gear. Cha-ching. Who’s in for setting up a MySpace account?
More from Facebook Takes Over the Retail World.
Credit to Wal-Mart to being ahead of the curve of traditional retailers in adopting new technology to reach out to customers. Curious to see how these consumers react to Wal-Mart when Target seems to have a stranglehold on this segment. Could social media technology give Wal-Mart a leg up?
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Wal-Mart held their annual meeting yesterday, holding back no punches with the entertainment:
Mixing business and pleasure, the four-hour event featured performances from such celebrities as Jennifer Lopez, American Idol winner Jordin Sparks and comedian Sinbad.
Sorry - I just find that as a odd mix of entertainment for the meeting.
Margaret Brennan has posted a good blog at the CNBC site with her thoughts from the meeting. Good rundown of some of the information that is interesting, but may have been overlooked by some of the bigger announcements.
This piece struck me as interesting:
After J. Lo finished performing, Lee Scott, Eduardo Castro-Wright and other executives stuck around to do their first press briefing ever. Clearly, Wal-Mart is starting to recognize that shutting out the press doesn’t help us tell their story more accurately. (Scott did say that he didn’t see any friendly faces in the crowd though, making clear he isn’t happy with press coverage or the media’s presence.)
Wal-Mart is very private within the media. As they try to turn things around, they need to realize that they need to be more accessable, put on a more human face, and be more transparent.
You can read more at her blog. More coverage of the event from the Star Telegram.
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Over at Big Box Watch, I’ve noted that Wal-Mart has announced that they are scaling back their expansion efforts. New store growth will be reduced to 170 supercenters next year, down from 270 stores that they had originally planned to open this year.
This move by Wal-Mart is a long time coming. The rate that the retailer grew eventually would have to end. Wal-Mart needs to reevaluate their offerings and fuel growth from within, rather than fuel growth with new stores. Their comp store sales have not been strong in a long time, and now they have to figure out way.
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Consumerist has a detailed report about a worker, who was fired from his job at Wal-Mart, based on a comment he left on MySpace:
The exact quote said “Drop a bomb on all the Walmarts, trailer parks, ghettos, monster truck shows, and retarded fake “pro wrestling” events, and the average I.Q. score would probably double.” This was a silly statement, but in no way was a threat as Walmart said and used as reason for my termination and denying my unemployment benefits. On my “Exit Interview” they checked Gross Misconduct - Integrity Issue (which they describe as: Theft, Violent Act, Dishonesty, or Misappropriation of Company Assets) as the reason I was fired. They wrote on the exit interview that it was a threat posted on website; which it clearly is not.
Consumerist provides a more more detailed account from the fired employee. The comments on the story provide an interesting debate and look at employee vs. employer rights, and how far the line extends outside of the workplace.
We live in a digital age and we have to be careful what trace of our lives we leave online.
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Wal-Mart faces more legal problems ahead. Today, the New Jersey supreme court has certified a class action lawsuit against the retailer for claims that the retailer denied workers’ meal breaks, forced them to work off the clock, and forced them to work on the breaks.
More from Forbes (NJ Court Certifies Wal-Mart Class-Action) and the Asbury Park Press (Wal-Mart to face New Jersey class-action pay suit).
This is probably not a good thing for Wal-Mart, as they have previously lost similar class action lawsuits in Pennsylvania and California (I talked about the PA verdict last year). These kinds of cases are a reminder to all other retailers that they have to stay on top of labor practices, and more importantly, they are responsible for what their store-level management is doing. I’m sure Wal-Mart is not the retailer that is at fault, but these high profile cases send ripples through the industry.
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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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Transworld has an in-depth article about the state of women’s skate footwear: Is Womens Skate Footwear Still A Viable Category For Independent Retailers? I like this article because it talks about the state of an industry in relation to one single category. How can an entire segment of retailers (independent skate shops) better compete with an entirely different segment of retailers (everyone else). Good analysis, good article.
Walgreen has announced that they are buying in-store health clinic, Take Care Health Systems. They look to expand their in-store health clinics to 400 by the end of 2008. Like I said when Wal-Mart made a similar commitment last month, I think that this move is good for the company and good for consumers.
Finally, troubled VOIP company, Vonage, is having problems hiring and retaining talent. Who would have thought all of the bad press that they have been getting is having an impact on HR?
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More on the Skype / Wal-Mart deal, from Skype itself.
Mentioned it the other day, but today more details came out about the Kohl’s sponsorship of Fergie’s tour. Should be a good promotion for the retailer and help to increase awareness of the Candies’ brand. I don’t recall any marketing push on this kind of level with the past two Candies’ girls for Kohl’s (Hillary Duff & Cheyenne), so maybe the third time is a charm.
10 Reasons it is Better to Sell Apparel to Dogs Than Humans. Estimates are that 2007 will see over $40 billion spent in America on pets, and here’s the reasons why the field is wide open for retailers.
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Is Wal-Mart the shot in the arm that VOIP technology needs?
Wal-Mart Stores Inc. is adding an array of Skype phone gear to the electronics section in 1,800 stores, bringing the renegade provider of cheap calling over the Internet to a huge mainstream audience.
The dedicated Skype section will feature handsets, headsets and webcams designed to work with Skype, a provider of free and very cheap long-distance calls, including to phone numbers abroad. Wal-Mart will also sell the first prepaid cards for Skype calls to be sold in this country, the companies were announcing Monday.
The new section at more than half of Wal-Mart’s roughly 3,300 U.S. stores will feature Skype-compatible gear made by Motorola Inc., Plantronics Inc., Logitech International SA, Royal Philips Electronics NV and others.
Obviously there are huge positives in this move for Skype. The more doors that they are able to sell in, the more consumers that they are exposed to, the more their sales increase. Although Wal-Mart already offers Vonage products, increasing the VOIP offerings in the retailer will also increase aware of VOIP technology as a whole. Offering a lower cost alternative to major telephone companies, Skype could be a very good fit for the Wal-Mart demographic.
My concern is whether or not the consumer walking into Wal-Mart is going to be able to really find out what Skype and VOIP is about. I’m going to guess that in the majority of cases, they are not. It seems that product knowledge is not a trait that most retailers are pushing on their employees these days. I hope that this really isn’t the case, as Wal-Mart makes a huge push to increase their electronics offerings, but I have my doubts.
More from the Asbury Park Press / Associated Press.
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