ETD: 947 The World is Flat;Plagiarism; Luxury Consumers
Continue on a Spending Spree in 2005
E-Tailer's Digest
etd_post at gapent.com
Tue Jan 17 13:28:50 GMT 2006
E-Tailer's Digest --- Everything for the Retailer
Issue #0947 January 17, 2006
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] The World is Flat
[3] Plagiarism
[4] Luxury Consumers Continue on a Spending Spree in 2005
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[1] Greetings.
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Hi All:
List member Paul Roth tells us about the new best
seller "The World is Flat" by Thomas Friedman, in
particular a section on UPS. It's amazing how
that delivery service is now into so many
different services. It's something to look at when expanding your business.
I had an article plagiarized this week. A
potential client of the company who distributed
the article remembered seeing it somewhere, and
sent me a copy of the article. Sure enough -
word-for-word plagiarism. Has anybody
experienced this, and what did you do? This
company is in the U.K., and I do have my attorney (my son) on it.
Pam Danziger was keynote speaker at the NRF show
this past week, and shares a press release with
us. Did anybody attend the NRF?
Now, let's get to everything for the retailer.
Sincerely
George Matyjewicz, PhD
Chief Global Strategist, GAP Enterprises, LLC
mailto:georgem at gapent.com
http://www.etailersdigest.com
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[2] The World is Flat
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On the flight to Shanghai I started reading “The
World is Flat” by Thomas Friedman.
I was most intrigued by Chapter 2, section 8,
which is called Flattener #8 Insourcing. (pages
141 150). I had no idea that UPS did so
much. They've designed a global delivery system
that allows them to deliver their products with
that same efficiency; they are so efficient that
they literally have a phenomena at UPS called
"end-of-runway services." What do they do? Right
before your product gets shipped, right at the
end of the runway (almost literally it's in the
hangar, it's not literally at the end of the
runway), they'll attach something; they'll attach
a new lens to your camera, they'll add a special
logo to your tennis shoes, they'll design it just
for you, and they'll slap that on at the end of
the runway. That's how efficient these systems
have become. And of course, when you put them all
together, you get a very flat global playing field.
With your Toshiba laptop, what do you do when it
breaks? You call Toshiba, and they tell you to
take it to the UPS store and send it to Toshiba,
and they will repair it and send it back. What
you don't know is that your Toshiba laptop goes
from the UPS store to the UPS hub at Louisville
Airport in Kentucky, their global headquarters,
where in a clean room, in a hangar, at Louisville
Airport, your Toshiba laptop is repaired by a UPS
employee. Your Toshiba laptop never goes back to
Toshiba. They don't want to see it. They insource all of it to UPS.
You call nike.com, go online to order a pair of
sneakers for your kids. UPS answers that email.
UPS picks and packs the shoes. UPS ships them.
UPS bills them, and UPS collects the money. You
see the Papa John's Pizza truck go by. Guess who
is driving? It is someone in funny brown shorts working for UPS.
There are whole companies today — and you would
be shocked to know how many — who never touch
their products anymore. They have been completely
insourced to UPS or FedEx or DHL.
It would be really interested to see where UPS is
in RFID technology. I bet that they are planning to take it to the next level.
Paul Roth
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[3] Plagiarism
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I had an article published a couple of years ago
entitled "15 Ways to Cut Costs." It's the little
things that count: a 10 percent increase in
profit is more likely to come from 20 things that
contribute a half a percent each than from one
thing that gives you the full 10 percent. Here
are 15 tips to help you cut costs and increase
your bottom line. http://www.businessknowhow.com/money/bottom-line.htm
Well somebody sent me a note today entitled "Does
this article look familiar?" It seems a
consulting firm in UK (Cavendish) took the whole
article, word-for-word, put their name on it and
sent it out to clients and prospects. The guy
who received it is a client of theirs and also
remembered that he saw it somewhere.
I sent a cease & desist letter and also cc'd my
attorney (who is also my son). They replied that
the information was in public domain, and
available from various sources, until I showed
them how the 15 points were exactly as I
wrote. There may be some legal action here.
So, if anybody is considering using the
consulting firm of Cavendish (http://cmtr.co.uk)
think again. They are not original.
Has anybody had issues like this, and what did you do about it?
George
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[4] Luxury Consumers Continue on a Spending Spree in 2005
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In a speech at the National Retail Federation’s
Annual Convention Pam Danziger, president of
Unity Marketing, announced the results of Unity’s
luxury consumer survey. “Luxury consumers ended
2005 on an up swing. The average amount spent by
an affluent household on luxuries, including
luxuries for the home, personal luxuries,
automobiles and luxury experiences, rose 3.8
percent, to $52,588 in 2005, from $50,640 in
2004. But their spending continues to shift
towards the experiential, while they are spending
about the same or slightly less in traditional luxury goods categories.”
The average luxury consumer household spent 4.6
percent less on home luxuries in 2005 as 2004,
$19,990 as compared with $20,948 in
2004. Personal luxury spending, on things like
luxury apparel, fashion accessories, jewelry and
watches, wine and spirits, pet luxuries and pens
and desk accessories, rose 5.6 percent to $10,007 in 2005.
Luxury consumers’ spending on experiences nearly doubled in 2005
Spending on luxury experiences, including travel,
dining, entertainment, spas and beauty services
and home services, nearly doubled, from an
average of $11,632 in 2004 to $22,746 in 2005 — a
95.5 percent increase. The average amount spent
on luxury automobiles, a low purchase incidence
category as compared with the others, also rose
in 2005, up 18.5 percent to $42,696. (Note: the
category averages don't total $52,588 because not
all households buy in all categories.)
For luxury goods marketers and retailers the
challenges for the future are daunting in the
face of this trend toward experiences — Luxury
consumers are spending more, in many cases lots
more, on life-changing experiences, while their
need for luxury goods is waning.
Now that the baby boom generation (which makes up
57 percent of all households with incomes of
$100,000 or more) is turning 60, they have
already acquired the material trappings of
luxury. Buying another mink coat, diamond
necklace or designer handbag just doesn't have the same appeal.
The trend for the future for the baby boomer
luxury consumers is toward experiences and this
will tip the entire luxury business experiential
simply because of the generation’s size.
Americans are growing wealthier and feel entitled to spend on luxury
Americans continue to grow wealthier with the
average income of all households rising to
$60,500 in 2004. There are 30.2 million
households with incomes of $75,000 (which Unity
defines as near-affluent and affluent) and the
average income of that segment is $137,500. At
the upper end, there are 1.7 million households
with incomes of $250,000 and that segments’
average income is $438,338 per year.
As luxury consumers’ incomes rise, so too does
their spending. Households with incomes over
$150,000 tend to spend two-to-three times more in
most categories of luxury than those with
near-affluent incomes of $75,000-$99,999. But
interestingly their purchase incidence of luxury,
i.e. the percentage of households that purchase
luxuries, is level across all income levels.
Danziger explains, “That means near-affluent
households are buying luxuries at about the same
rate as super-affluent households, only they are
spending less. It’s the difference between
buying last season’s Coach bag in the Coach
outlet store as compared with the latest Dolce &
Gabbana number at Saks Fifth Avenue. Both are
luxurious to the individual consumer.
“That is another key trend in the luxury market
today — The consumer is the final arbiter of
what is luxury, not the manufacturer, the
designer, or the retailer. Consumers at all
income levels feel entitled to luxury, whether it
is a ‘big’ luxury like a two-karat right-hand
diamond ring from Cartier or a ‘little’ luxury
like a similar-sized Moissanite ring from J.C. Penney’s.”
About Unity Marketing’s Luxury Consumer Tracking Study
Every quarter Unity Marketing conducts a Luxury
Consumer Tracking Study among 1,000+ luxury
consumers. For the fourth quarter 2005, a total
of 1,126 consumers were surveyed with an average
income of $139.2k and average age 41.1
years. Year-end 2005 statistics are compiled
from the four tracking studies during the year
and will be published in Unity Marketing’s Luxury
Report 2006 — Who Buys Luxury, What They Buy, Why
They Buy (http://www.unitymarketingonline.com/reports2/luxury/luxury1.html)
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