Category Archives: Consulting

August 7, 2014 · 1:09 pm

What Price Ethics?

So here is an interesting question for you.  I was reading the results of a study conducted by the good folks from Trade Extensions that concerned how consumers view ethics and sustainability and how they affect purchasing decisions.  When you ask people how important it is that companies behave ethically and with an eye towards sustainability, four out of five consumers regard it as important.  That would suggest that doing the right thing (whatever that may be) is a critical factor in purchasing, right?

Not so much:

When asked to rank the three most important attributes when shopping, the most important factor is price – 40% of consumers ranked this number one.  The second most important factor is value for money – 30% ranked this number one. And the third most important factor is quality –  16% ranked this number one.  Choosing an ethical company or brand when shopping is the most important factor and ranked number one for 2% of UK and US consumers.

Hmm.  So is that a license for a company to do whatever they want as long as prices are low?  Given some of the voices speaking out against Walmart, for example, over things such as foreign product sourcing, treatment of product suppliers, environmental practices, etc., apparently not.  Like most things in business, it’s not quite that black and white.  The research shows a desire from consumers to buy ethically but ultimately price, value and quality are the deciding factors.

Other studies have shown similar results.  One from Accenture found that sales and competitive pricing (61%) are by far the most critical factors in getting consumers to make a purchase. Superior products (36%) and customer experience (35%) are also key, according to respondents, followed closely by customer loyalty programs (31%) and relevant promotions (26%). Ad campaigns and celebrity endorsements trailed by a significant margin, presumably as they’re more influential in driving awareness than completed purchases.

So back to ethical behavior.  Can any company afford to ignore it?  I suspect it’s very possible to do good while doing well and to enhance the quality of consumer’s lives in an honorable way.  Maybe it’s not much of a selling point because so few companies have that focus?  What is your take?

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August 6, 2014 · 1:15 pm

Experts? Hardly.

You may be following the saga of Foursquare as it tries to find a business model that works.

Foursquare Logo

(Photo credit: Wikipedia)

The bloom of collecting badges has clearly worn off and almost every app has some sort of check-in feature to let your friends know where you are. Now Foursquare seems to be moving in a direction that will let them compete with Yelp (which has a good business model) and are splitting off the check-in part of the service into another app (Swarm).
Maybe you got the same email I did the other day which talked about their new feature called “Expertise”:

In the new Foursquare, we want to reward people who share their expertise, helping other people to great experiences. When you leave great tips, you make progress. And, the more people like or save them, the faster you’ll earn expertise.

It goes on to say that all of the tips you post thereafter will show they were posted by an expert.  On behalf of people who actually DO have some expertise on a few things, may I call BS?  I’ll even go further: I’m offended.

I’m offended because any moron with the price of dinner and a mobile device can write a review which may be complete blather and very inaccurate. I have no problem there.  But if they do so 10 or more times, does that really make them an expert or just a blithering idiot?  How is anyone to recognize the real experts?

I’m offended  because Foursquare is doing something that I find offensive among a number of content companies.  They are using the very same audience they sell to marketers to make their product.  The reward to the consumer for doing so?  An ego trip:

Once you’ve earned an expertise, we both mark your tips as coming from an expert (so the world knows), and make sure more people see them because they’re high quality. And, when you’re looking for great things to do when you’re at a place, you can see which ones come from experts.

How about something more tangible – a gift card, a weekly sweepstakes, anything that reflects the value of the contribution?  Foursquare seems to believe the famous Woody Allen quote that showing up is 80% of success.  If you show up at a place and write about it, you’re a success – an EXPERT!  My take?  Hardly.  Yours?

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July 31, 2014 · 11:38 am

Don’t Leave Home

One of the classic ad lines is”don’t leave home without it” which David Ogilvy penned for American Express 40 years ago.  I asked myself how the line would have been written today as I read a study from Accenture on shopping and retailing.  It’s called From Retail to “Me-tail” and you can read it here if you are interested in their take.   These points really caught my attention:

• Stores as we know them will no longer be relevant—many shoppers will never even visit one
• Consumers will be able to shop seamlessly across multiple channels—and expect to find relevant content on all of them
• “Fast fashion” will be the de facto industry standard—with dramatic consequences for store inventory levels
• Supply chains will be optimized across the full product lifecycle—right through to disposal
• Consumers themselves will help form the communities of talent required to service a vast diversity of new and constantly shifting demands

That first point has profound implications.  What will take the place of retail outlet?  I can’t see Main Street populated by warehouses or shipping centers.  The truth is that as my family’s shopping habits have shifted to online, we leave the house far less often to hit the stores other than the supermarket.  Ogilvy’s classic line works less well when consumers don’t leave home at all, at least not to shop.

What can retailers do? I like one site’s take on the study:

Ensuring consumers are comfortable and confident wherever they make purchases is critical for brands as they bridge their online and offline experiences. The comfort of brick and mortar stores can easily be replicated online with the right tools and tactics. And, brick and mortar will continue to become more like online via their use of analytics and in-store digital tools that enhance the customer experience. Once these types of strategies are in place, customer satisfaction will improve along with the retailer’s bottom line.

That makes sense to me.  You?

 

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