ETD: 844 Holiday Shoppers Slowing Down; What is branding?;
Candle, Home Fragrance and Air Filtration Markets
E-Tailer's Digest
etd_post at gapent.com
Tue Dec 21 12:10:01 GMT 2004
E-Tailer's Digest --- Everything for the Retailer
Issue #0844 December 21, 2004
George Matyjewicz, Moderator mailto:georgem at gapent.com
Published by: GAP Enterprises, Ltd. http://www.etailersdigest.com
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CONTENTS
[1] Greetings
[2] Holiday Shoppers Slowing Down
[3] What is branding?
[4] Candle, Home Fragrance and Air Filtration Markets
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[1] Greetings.
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Hi All:
Looks like the luxury shoppers are finished this season, and now we
commoners are shopping. Unfortunately the spending is not the same. While
it doesn't help the retailers, consumers did get a lot of discounts this
past weekend. How's it going for you?
List member John Shulte has posted some interesting material on
branding. What do you think?
And Pam Danziger is looking for sponsors for a new report on candles, home
fragrance and air filter markets. It will be very valuable if you are in
those industries. At a previous engagement, we participated in these
sponsorships and were well pleased with the results - it gives you a jump
on the market.
4 days until Christmas - down to the wire. How are you doing this year?
Tell us about your business, which will remain for posterity at
our "Members: Who Are You?" site. Anything to do with the retail world,
i.e., supplier, retailer, consulting,
etc. http://etailersdigest.com/resources/members/index.htm And we have a
form there for you to tell us about you. As I said when I first proposed
this idea, we have "known" each other for a long time, yet we often don't
know anything about each other. So, tell us who you are and what you do.
Now, let's get to everything for the retailer.
Sincerely
George Matyjewicz, PhD
Chief Global Strategist, GAP Enterprises, Ltd.
mailto:georgem at gapent.com
http://www.etailersdigest.com
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[2] Gift Shoppers Hit the Brakes On Spending
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Many midprice retailers tried to spur sales with sharp price cuts.
Discounting was so steep at major middle-market stores that some experts
question whether retailers can bring home the 4.5% sales gains the industry
has projected for the 2004 season.
"The mall was busy, but there wasn't a frenzy in the stores," said Jim
Neal, a retail and brand strategist at the Atlanta consulting firm Kurt
Salmon Associates. His firm was among those predicting healthy holiday
profits for the industry back in November, the result of cautious planning
and tight inventories. But after an unseasonably warm autumn combined with
a lack of hit trends in fashion and toys, many stores whacked away at
prices. "The level of discounting might put those profit expectations in
jeopardy now," Mr. Neal said.
While luxury shoppers led the charge to spend at the start of the
Thanksgiving weekend, economists kept a nervous eye on low- and
middle-income consumers. Now, it seems clear that high prices for gasoline
and home heating are taking a bite out of their Christmas spending.
ShopperTrak of Chicago estimated that retail sales on Saturday were down 7%
to $6.7 billion compared with the same Saturday last year. Bill Martin,
co-founder of the research group, said a slowdown is evident even taking
into account that there are two additional shopping days between
Thanksgiving and Christmas this year. "The two extra days may provide a
burst of sales that wasn't there last year, but the number is a little
alarming," Mr. Martin said. ShopperTrak estimates sales based on data
collected via 40,000 cameras installed in malls and other stores.
On Saturday, Wal-Mart Stores Inc., the Bentonville, Ark., discount giant,
said it is still looking for a 1% to 3% uptick in U.S. same-store sales for
December, a reduction in its initial forecast of 2% to 4% gains. By the
middle of last week, the world's largest retailer says it saw a pickup in
customers shopping for general merchandise and winter items instead of just
food. But sales of gift cards were up significantly over last year --
meaning holiday sales may arrive even later than expected. (Most retailers
don't record gift-card sales until the cash stored in the cards is redeemed.)
The industry's bright spots continued to shine. Online holiday sales of
apparel, music downloads and other entertainment items continued their
blistering pace. Online retail spending, excluding travel, rose 26% from a
year ago to hit $13.1 billion for the period from Nov. 1 through last
Saturday, according to comScore Networks, a Reston, Va., market-research
firm. Holiday spending online is expected to exceed $15 billion for the
November-December period, marking an increase of 23%, comScore said.
Jeff Wilke, senior vice president in charge of world-wide operations at
Amazon.com Inc., said the company expects "this to be our biggest holiday
season ever," despite technical glitches on the Web site that temporarily
prevented customers from placing orders Dec. 6. Online sales were expected
to drop off over the weekend because free shipping offers from many of the
big Internet retailers expired last week.
Sales of several electronic gadgets have exceeded retailers' expectations,
including many videogame machines. "People were really mad at me this
morning, because we are sold out of Xbox, Playstation 2 and Nintendo DS,"
said a North Dallas Best Buy salesman.
And many designer items are selling. "Anything glitzy or fancy has been
really strong," said Laurel Crary, general manager of the Beverly Center
mall in Los Angeles. Gucci sunglasses, beaded moccasins, "anything
fur-trimmed" and unusual toys, such as a $275 pink Hello Kitty bicycle, are
hot, she said.
But no single toy has emerged as the season's must-have-at-any-price item.
By noon Saturday, Janet Medlock, a 55-year-old grandmother from Plano,
Texas, and her daughter, Shawn Page, had already been to three stores to
get the best prices on toys they had researched in advance. They bought
dolls at Toys "R" Us Inc., which they said had the best selection, then hit
Target Corp. to save $5 on the Roller Coaster Tycoon 3 personal-computer
game. They went to Wal-Mart and got their hands on the Hot Wheels Slimecano
playset for $29 -- $13 less than at many other stores -- and Fur Real
Friends baby stuffed animals that were $3 cheaper here. Ms. Medlock said
she is spending less this year, "but I'm shopping smarter."
After a year of strong sales for luxury handbags, perhaps it's no surprise
that accessories that attach to designer handbags should emerge as a strong
gift. Stacie Shirley, a spokeswoman for Neiman Marcus Group, said
especially big sellers are "tricks" from the Prada label. The small, $138
decorative accessories clip to handbag straps and look a lot like key
chains. They come in designs including a hot-pink high-heeled shoe, a heart
emblazoned with the Prada name and the designer's iconic triangle logo.
Coach Inc. has seen strong demand for small accessories: Some styles of
coin purses and cosmetics cases, used to tame the clutter inside the
typical handbag, have sold out, as have $68 and $78 cases for the iPod Mini
and regular-sized iPod, respectively. Coach Chief Executive Lew Frankfort
said he is confident that Coach stores will achieve same-store sales
percentage gains in the low teens.
But at many midprice department and specialty stores this weekend it looked
as if Christmas had already come and gone. At a Gap Inc. store at the
Woodfield Mall outside Chicago, one corner was filled with bright, fresh
displays of colorful spring clothing -- while the rest of the sales floor
was cluttered with teetering piles of marked-down goods. The clearance
merchandise was stacked by price, with holiday T-shirts, pajamas, sweaters
and jeans on tables underneath signs advertising gifts under $15, $30 and $40.
The Express store at the mall knocked 50% off all sweaters and was selling
knit tops usually priced at $19.50 to $22 at two for $20. Much of the
holiday fashions in the Limited store were discounted 40% to 50%. Both
Express and Limited are owned by Columbus-based Limited Brands Inc.
J.C. Penney Co. took 50% off its entire stock of mens and womens coats, a
promotion it says it has been planning for months. At an early-morning sale
on Saturday, table loads of St. John's Bay microfleece scarves, gloves and
headbands were marked down by 60%, selling for $12 a set.
Details at:
http://online.wsj.com/article/0,,SB110350189684804365,00.html
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[3] What is branding?
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In June of 2000 I made a few predictions for direct marketers for the
coming years. Prediction 3 was; "Millions spent by web companies on
"Branding" turn out to be a waste."
http://www.nmoa.org/sponsors/jsart/schult6.htm
I'm a fairly simple person, to me a good "Brand" is a name on a product
that I trust to be good from past experience. As a consumer I put products
into "Good Brand" and "Bad Brand" categories when making purchasing
decisions, and maybe a "so-so" category.
If I have a good experience with a certain company's product, I consciously
put them in the good "Brand" section of my mind for future purchasing
decisions. Of course, when asked, I also would say to someone; "yeah, I
bought one of those and I'm happy." That's how a "Brand" is built in my mind.
So, I believe a "Brand" must be earned, it is something given to a company
by happy customers. It is something that cannot be bought with money. Take
for example Craftsman tools by Sears. They became popular with millions of
home mechanics and handymen because they were good tools for the price.
You could count on them lasting, and Sears backed many of them up with a
lifetime guarantee. So Sears put in place a foundation for Craftsmen
becoming a successful "Brand", but the people that bought and used the
tools, and told their friends they were good, is what actually made
Craftsmen tools a good "Brand".
Sears was then able to leverage the Craftsman "Brand" to many other
hardware, automotive, and home products. They could do it because people
figured, hey, Craftsman tools are good, this product must be too. FYI, the
Craftsmen "Brand" was launched in 1926, so Brand is not built overnight.
Sure, you can spend millions promoting a company or product, thinking you
are building "Brand", but what you are doing is simply getting more people
trying a product faster. This alone will not make a good "Brand"; in fact,
it can help build a bad "Brand" faster if the product quality or shopping
"experience" is bad. There are a lot of recent examples of this in the
Dot-Com flash and burn era.
I understand that many people consider "Brand" as the image the company
portrays to attract a certain type of buyer or buyer want-to-be's. And I
belive this is part of the overall equation of total "Brand". But the
product itself, and the value it gives will be the true underlying factor
in building a "Brand" for long term success. You can not build a good
"Brand" if everybody that uses the product says it sucks! And that will be
true no matter how ingenious and creative your message is, or how much
money you spend on spreading it.
--
Best regards,
John Schulte
President and Chairman
National Mail Order Association (NMOA)
http://www.nmoa.org
Email: schulte at nmoa.org
Tel: 612-788-1673
http://www.nmoa.org/schulte
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[4] Candle, Home Fragrance and Air Filtration Markets
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The market for candles and home fragrances is changing rapidly, as consumer
seek new, more healthful alternatives to adding fragrances to their home.
The candle market may well have plateaued now that sales are nearing $3
billion at retail and some two-thirds of consumers buy candles. Marketers
are introducing new fragrance delivery mechanisms, the most innovative of
which is the Fabreeze ScentStories discs that play rotating fragrance
'stories.'
People are burning candles in new places, like the garden where ordinary
candles get lost; selecting new fuels, such as soy and oils; and shopping
for candles and lighting accessories in new places, like the local Wal-Mart
or grocery store where whole aisles are devoted to the category.
Marketers and retailers need to address these and other trends in the
changing ways consumers are using and shopping for candles, home
fragrances, lighting accessories and air filtration products. Marketing
success will come to companies that identify the shifts and turns in the
consumer market before everybody else. And that is what this research study
is all about. It will giving companies that NEED TO KNOW the future of the
candle, home fragrances and candle accessories market a view 'over the
horizon.'
Unity brings a new approach to consumer insight research that will make you
the smartest competitor 'on the block.' Research that will tell you not
just what has happened and where the market has been, but where it is going
and how it is changing and shifting and transforming. The result: Your
company will be ready and prepared when the future arrives.
Unity Marketing has designed a major new research study to give future
vision to marketers and retailers of candles, home fragrances, candle and
lighting accessories and air filtration products.
This research will give marketers and retailers with a NEED TO KNOW about
the future of the candle and home fragrance markets a cost-effective
solution for customized consumer research. Unity Marketing is launching a
new in-depth quantitative research survey of the consumer market for
candles, home fragrances and candle accessories.
With the focus on the consumer, their needs, desires and preferences, Unity
Marketing's research study will focus on buying behavior and consumer
motivation for purchases of candles, home fragrances, candle and lighting
accessories and air filtration products. Topics to be investigated in the
consumer survey include:
o Why do consumers buy candles, home fragrances, candle and lighting
accessories and air filtration products? What kinds do they buy? Where do
they shop for these goods? How much do they spend and how often do they shop?
o Why do they buy these goods? What motivates and excites them in these
purchases?
o What criteria do they use when selecting these products? What criterion
drives them in choosing a store to shop for these goods?
o What brands are important in this market and how much do they spend when
they shop?
o How important is price, style, material, brand and store in the buying
equation?
o What drives the shopper into the store to shop for these goods?
o What new opportunities are on the horizon for candles, home fragrances,
candle and lighting accessories and air filtration goods marketers and
retailers?
o How can marketers and retailers take advantage of consumers' passion for
these goods? What is next on the horizon in the home fragrance arena?
o How do men and women differ in their buying patterns, as well as the
different motivations that drive consumers in their quest for these goods.
We will also explore the generational aspects of this market? What are the
differences between younger and older consumers in their product
preferences and buying and shopping behavior for candles and home fragrance
products?.
In order to assure that this new consumer research focuses on the issues of
most importance to candle, home fragrances and candle accessories goods
marketers and retailers, Unity Marketing offers sponsorships to companies
who want to be more involved in the research. As a research sponsor, your
company will be involved in setting the research agenda and will get the
early results of research. The research will be 'semi-custom' as company
sponsors will contribute directly to the research. Here are the deliverables:
o Input on the questions included in the survey;
o Your company's major product category included in the survey;
o Your company's brand name will be included in the brand awareness and
purchase incidence questions;
o Deliverables will include topline quantitative survey results with
demographic cross-tabs within 1 week of survey fielding, detailed analysis
report and telephone consultation about key findings and implications.
Plus you will get an early read on the results of the research ahead of
everybody else and insider information only available to sponsors.
As a sponsor, you'll participate in learning what drives the candle and
home fragrance buyer in shopping and product selection. You will discover
how to tap into consumers' passion for these goods in order to design new
products to meet new needs. You will learn how to sell more of your
company's or store's products. You will get a view 'over the horizon' about
where the candle and home fragrance product market is going and find out
how to get out in front of the consumer.
Respond Immediately—Time Is Limited
So if you are interested in participating in the candle and home fragrance
research project, you can complete the request form at
http://www.unitymarketingonline.com/reports2/candles/candles_reg.html
Or you can call me at 717-336-1600, or respond by email to
pam at unitymarketingonline.com right away.
Please respond by December 31, 2004 if you are interested in participating.
Candle and Home Fragrance Research Sponsorship: $2,500
Pam Danziger, President
Unity Marketing, Inc.
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