No Turn On Red

Last week, Kohl’s discussed some of their holiday marketing strategies with the press. They plan on increasing their spending to capture a larger share of the dwindling holiday sales figures, with increased emphasis on direct mail, e-mail campaigns, and online-only sale prices.

Going into the holiday season, the retailer, which has seen Web sales increase by more than 50% so far this year, is making a big push online as well. It plans to send email blasts out to 15 million shoppers — more than double the number that it had on its electronic mailing list last year — and it’s offering one or two specially discounted items on Kohls.com every day through Christmas.

Their website has started advertising these online-only specials on their homepage, with a callout that went live this week (apparently):

This is a very interesting shift in marketing for the retailer that has, until now, always offered consistent pricing in-store and online. Their marketing campaigns even advertised this fact and, for years, coupons that were sent out to customers, in direct mail, were also good online.

Kohl’s needs to be aggressive in order to increase their market share this holiday season. This is a perfect opportunity for the retailer to utilize a service, like Twitter, to advertise these special, limited-time promotions. It is obvious that they want to aggressively promote these deals as they they are utilizing prime screen real estate to push the deal. It even appears that they already have a Twitter account, although with zero posts. They should be using this to promote the daily deals and reach more people, one-on-one.

The usage of the service would be simply – they’d just need to follow the example that other retailers have set to announce daily deals. I look at the Amazon MP3 Deal of the Day and Woot.com as two examples of retailers using the service to effectively promote daily deals.

Maybe the first step, for a retailer like Kohl’s, is the use the service to promote daily deals and then they can evolve into using the service to engage customers in conversation. I think there is always more room for retailers to use Twitter to reach their customers.

What do you think?

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A bit of lingo that I’ve learned lately: turns out that Target refers to the the impact of the Back to School/Back to College season on their stores, by classifying them into levels. The levels are No Affected, Affected, Freaky, and Super Freaky. It doesn’t appear that there are a lot of Super Freaky stores in the company, but those that are classified as such, are situated within close proximity to college campuses. I wonder what kind of percentage increase these stores see, over the rest of the company, during the season.

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The New York Times ran a report this weekend, suggesting that online retail sales may be losing steam. The report has gotten a lot of people talking across the industry, but it is slightly misleading. While the year over year growth may slow down a bit, overall retail sales will continue to grow with the help of online sales.

Retailers need to continue adapting their online retail strategies. I think the most growth will still be seen within traditional (”brick and mortar”) retailers who create an online experience that is an extension of the in-store shopping experience. This will continue to create consumers who are better informed, make more confident purchases, and feel a stronger connection to the retailer.

Traditional retailers should begin to view their online presence as an extension of their brand. They should seek to create communities around their brand instead of just pushing products. There is still a lot of room to grow in this area. The result will a more loyal customer and an increase in overall sales.

Margaret Brennan at CNBC writes that online shopping is not dead yet. Good look at the rise in non-traditional online sales, including sales in footwear and apparel.

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Today’s Washington Post has a very detailed, in-depth look into teen shopping habits that, I’m guessing, is going to make the rounds at corporate offices of mall retailers today:

Sixty-one teenagers from across the Washington region descended upon Tysons Corner on a recent Saturday. And we were there to capture it all.

We wanted to learn how today’s teens make their purchasing decisions, how they calculate value and how they figure out what’s cool. These teenage volunteers, all between seventh and 11th grade, brought their own money, friends and sense of style. Some came with their parents; some with their parents’ credit card. But all of them brought strong opinions about what they like — and what they don’t.

More than a dozen Washington Post and washingtonpost.com staff members documented the shopping expedition through stories, photographs, audio and video. We gained insight into teen consumer psychology and the latest trends, but we also learned a lot about the teenagers themselves.

With 10 associated articles, photos, video, and an interactive map detailing how many people visited different stores and how much money was spent, this is a rather fascinating read. Detailed, detailed, detailed. Only click on this link if you have time to kill, because it will suck you in with the amount of information available: Tracking Teen Shopping Habits.

I’m not going to be able to sumarize everything that the Washington Post has in that article, but there are a few points that jumped out at me that I’d like to share:

Collectively, the teens spent the most money at Hollister ($498) with Urban Outfitters a distant second ($319). $288 was spent at American Eagle while $198 was spent at Abercrombie & Fitch. Old Navy ranked up there, with over $160 being spent by these teenagers. Non-existant in this group was PacSun, with 10 visits and no money being spent.

These teenagers are smart. One article centers around their price conciousness (When Mom’s Not Paying, Cost Is a Deal-Breaker) and one article is about their shopping strategies (On a Mission to Buy, With a Plan of Attack). These teenagers came equipped with plans, checking out fashion and getting information from the retailer’s websites prior to stepping foot in the mail.

Where’d denim go? These kids aren’t shopping for jeans, apparently.

Teenagers aren’t just shopping at specialty retailers. This group is also looking at Macy’s, Nordstrom, Bloomingdale’s, and Lord and Taylor to find the best deals.

The work put in to this report from the Washington Post is incredible. Like I’ve already said, this is a really fantastic read with a ton of information.

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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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CNBC television is reporting that Limited Brands has made three headlines:

- Limited Brands has reached an agreement with private equity firm Golden Gate Capital to sell a 67% stake in the Express brand for $548m

- They are still exploring “strategic options” for Limited Stores

- They have slashed their Q1 earnings forecast in half from $0.25 – 0.28/share to $0.12 – 0.14/share.

LTD Stock has reopened after being halted at $27.14 at 2:27 and has immediately dropped to around $26.

More from CNBC and a just issued press release by Limited Brands.

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CNBC television is reporting that Limited Brands stock (LTD) has been halted on the NYSE pending breaking news.

Jim Cramer on CNBC’s “Street Signs” speculates that they could be going to announce some sort of spinoff.

Speculation lately has been that the chain was shopping the under performing Express Fashion and Limited stores to potential sellers. Previous spinoffs from Limited Brands have included Abercrombie & Fitch, Lane Bryant, Lerner New York, & Limited Too/Tween Brands.

Could be an interesting shakeup to the mall landscape.

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The New York Times is reporting that, today, the trade organization Shop.org will release a report saying that, in 2006, apparel outsold computer hardware online while still offering tremendous room to grow sales:

In 2006, revenue from skirts, suits and shoes reached $18.3 billion, surpassing that from PCs, printers and word-processing programs, which totaled $17.2 billion, according to a report to be released today by a major trade group.

The surging popularity of clothing on the Web defies predictions that fashion — which is hard enough to buy in stores, with the aid of sales clerks and fitting rooms — would be difficult, if not impossible, to translate onto the Internet.

[...]

Consumers are still largely reluctant to buy clothing online, at least compared with products like computers. In 2006, they made only 8 percent of all clothing purchases on the Web, compared with 41 percent of computers, 21 percent of books and 15 percent of baby supplies, according to the Shop.org report, which was prepared by Forrester Research.

This is great news for apparel retailers and very good news for e-tailers (does anyone still use that term?). Since the overall saturation percentage is still low, online, that means retailers still have tons of room to grow their interactive marketing.

With the rise of web sales, I hope that more brick and mortar retailers further their commitment to e-commerce and continue to realize the power of the Internet not only for sales, but also for a means to interact with consumers.

More from the New York Times (see: Less Risk Is Seen in Buying Clothes Online).

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From Seeking Alpha:

J.C. Penney (JCP), Polo Ralph Lauren (RL) , Kohl’s (KSS), United Technologies (UTX): Cramer declares JCP a “multiyear story” because of Sephora cosmetics and the private label deal with RL, and would give the retailer the benefit of the doubt in spite of its lackluster quarter. Cramer comments JCP and KSS are stores which make customers feel “they’re richer than they are.” He predicts JCP will be up to $85 from $81.50. He added UTX has the earnings power to go to $70 from $66.

(See: Jim Cramers Stop Trading! Stock Picks and Comments, April 18)

Jim Cramer saying that Kohl’s and JCP makes customers feel “they’re richer than they are” might be the most accurate assessment of those two retailers that I have ever seen.

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When I graduated from high school and made the decision to go to Rutgers University, I know that it was somewhat looked down upon by some of my classmates and my peers. In the mid-90’s, Rutgers University did not have the kind of prestige within the state of New Jersey that it deserved. In fact, it did not have the kind of prestige within it’s own state that it did nationally. Some people looked down upon Rutgers as being just a state school and did not think that a school 20 or 40 minutes away could offer a great education.

Although I did not complete my education at Rutgers, I still have strong ties to the school and the New Brunswick community. I always thought that it was a fantastic school with a great program. Like many people around here, I have been very excited and proud to watch the sports program do so well in the national spotlight lately.

And, of course, the comments made by Don Imus this week have again thrown Rutgers into the national spotlight.

But how do you measure the success of all of this? How do you quantify “increased national recognition”?

As the Associated Press reports (see: Rutgers Sports Teams Undergo Renaissance), enrollment applications are up, alumni donations are up, and, to tie this in to this blog, sales of Rutgers apparel is up:

Last year, Rutgers received a record number of applications, more than 40,000. This year’s applications are running 7 percent ahead of that.

And through January 2007, donations to the Rutgers Foundation are up a whopping 35 percent over the same period last year, school officials said.

Rutgers is relatively selective for a big state university. It accepts about 60 percent of the students who apply, and more than half of those it admits were in the top 10 percent of their high school classes.

Meanwhile, the university’s “R” logo is popping up in more places as school pride grows throughout the Garden State and elsewhere. Marybeth Schmutz, assistant director of the university’s trademark licensing department, said sales of Rutgers merchandise are up more than 30 percent in the last year.

“You can’t walk into a Kohl’s or a Target or Modell’s without seeing Rutgers stuff,” she said. “We are getting new designs sent to us by people interested in selling Rutgers products every single day. It’s huge for us, and it’s still growing.”

Good news for Rutgers, even in the trying times. With a high quality recruiting class for Rutgers football, I foresee the sports teams only continuing to do well in the near future. Higher profile translates into more money for the school. I see this as only a good thing.

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