Category Archives: Helpful Hints

Showrooming

There’s a relatively recent phenomenon called “Showrooming” that’s becoming a concern for retailers.  In a nutshell, this is the practice of some consumers of going into a physical store to do research and then making the purchase elsewhere, generally online.  Given today’s technology, those purchases can even happen in the store via a mobile device.  A piece from eMarketer quoted a couple of studies that found this is not a hypothetical problem for retailers:

Several researchers have surveyed the number of US mobile phone users who have comparison-shopped via phone while in-store. Their research has found a comparison-shopping rate ranging from 59% of US smartphone owners (InsightExpress, 2011) to 25% of US mobile phone owners (Pew Internet and American Life Project, January 2012).

ForeSee Results findings from between 2009 and 2011 are consistent with this trend toward using mobile phones for in-store research; however, in 2011, the shoppers surveyed were more likely to access the website or app of the store they were actually in than a competitor’s website or app. This means that retailers need to not only be concerned about how their pricing stacks up against others’, but also about pricing consistency across their own channels.

This is sort of the same issue faced by music companies who are trying to sell physical media like CD‘s while enabling the purchase of the same product through digital channels.  The retailers need to differentiate themselves in ways that make doing business with them valuable beyond price.  Customer service, ease of returns, unique merchandise or unique offers are all areas that can be differentiators.  Target has reached out to vendors to do just that, and others are as well.

So the question to you today is this:  what are you doing to make sure that your business is different?  We can go back to the old advertising saw of the  Unique Selling Proposition – as we find in this space a lot, everything old really is new again or at least wrapped in new tools.

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Blind Tasting

Friday at last and while you might be expecting a lengthy piece on the history of corned beef for our Foodie Friday Fun approaching St. Patrick’s Day, I couldn’t really find any great business points buried in there.  Oh sure, we could have a chat about multiculturalism since corned beef is a food staple in many cultures (and strangely it came late to the Irish culture and it’s really more American Irish than it is native to the Old Sod) but that seems a bit forced.

LOS ANGELES, CA - JANUARY 24:  Wine made by Dr...

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So for today’s Foodie Fun I want to think about blind tastings, specifically wine tastings.  There have been many examples of unexpected results when all the trappings of a wine are taken away (big name, fancy bottle, vintage year, even what grape).  The most famous of these if the Judgement of Paris which one could claim was the birth of the modern California wine industry and was commemorated in the movie Bottle Shock.  In 1976, California wines were rated higher than many top French wines in a blind tasting held in Paris and judged by mostly French wine experts.  Of course, these same judges believed it would be easy to spot the “inferior” California wines and had any one of them conducted the tasting and written the results on their own, they might have been laughed out of their profession.  Which is, of course, the business point.

There is an old saying that no one ever got fired for buying (pick one – IBM, AT&T, Microsoft, etc.).  It means no one gets fired for making the safe pick and choosing an industry leader. While there are other companies out there with better products or offer similar quality as the market leaders at lower prices, they come with the risk of ridicule should there be a problem.  Speaking as an independent consultant I can tell you that bigger companies, where decision-making is often a group matter, seem to feel most comfortable hiring other big companies – you all know the top consulting firms.  It’s an easy decision to justify.  Too bad – if they were to taste us blind – have a telephone conversation with the people doing their work as well as to look at our fees – the might get the same or better outcomes at better rates.  That’s not just in my field of consulting – many businesses overspend and get inferior results because they don’t do a blind taste test.

If you’ve got concerns about using companies other than the big guys in any field, raise those concerns directly with the firm that rated more highly even thought they’re not the brand name.  Build the answers – service levels, delivery dates, etc. – into the contract.  Ignoring your business palate when it’s telling you something is better – even if it’s a brand with which you’re unfamiliar – is silly.  Who knows – you just might find a $10 bottle that puts the $50 swill to shame.

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Trust Me

You might have read the book “Trust Agents” by Chris Brogan.  It deals with the need to become a resource to your customers.  The book was relevant when it was written (2009) and is even more so now, as the results of a recent study show.  According to the research, conducted by Brightlocal.com and reported here:

  • Approximately 72% of consumers surveyed said that they trust online reviews as much as personal recommendations, while 52% said that positive online reviews make them more likely to use a local business.
  • Only 15% of consumers said that they had not used the Internet to find a local business (vs. 21% in 2010)
  • 16% of consumers said they used the Internet every week to find local businesses (vs. 9% in 2010)
  • More consumers are reading online reviews now than 15 months ago, with 27% regularly reading online reviews when looking for a local business to use.
  • Just 28% of consumers cite location &/or price as main decision-making factor

The takeaway is that local search is being used to research your business and positive online reviews are a bigger factor in your success than location or price.  That’s amazing but not surprising to me.  After all, the behavior of asking friends, family, or others about impending purchases isn’t a new phenomenon.  The technology and ease of finding that information is a relatively recent thing, and becoming easier every day.

There has been something in accounting called “goodwill” which is that value of a business above and beyond its assets.  Call it reputation, call it trust, but it’s definitely something that has value even if it’s intangible.  This piece called ‘Why Trust Matters More Than Ever For Brands” lays it out beautifully and this is the key quote:

We’ve all been taught that trust and reputation are important elements of branding. Today, though, trust is not simply a nice thing to have, but a critical strategic asset.

So what are you doing to make sure everyone in your organization conveys that your firm can be trusted with a customer’s business?  How actively are you watching your company’s reputation?  Maybe something for today’s (and every day’s) “to do” list?

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