CBA Industry Blog

It’s a new day for retailing - even for the big boys!

A friend of mine is a veteran of several Florida hurricanes. Four big ones hit the Sunshine State in a couple of years¾all affecting him and his household. He was so tired of hurricanes he moved.

To Louisiana.

Just 25 miles northwest of New Orleans.

Right before Katrina.

He evacuated his home and stayed with friends in Alabama for awhile finally returning home -- just in time for Rita. He had to evacuate again, so he went back to Florida to stay with family just as Wilma rolled onto the Florida coast.

“I feel like I’ve got a target on my back!” he told me in frustration.

Expelled Continued...

We were privileged at CBA to preview Ben Stein’s new documentary film Expelled. The film really draws battle lines in a war that goes back to Genesis. Did God create the world or are we just the results of some freak occurrence that began a chain of evolution resulting in humans? Or maybe, as some scientists think, we’re just progeny from alien-planet seeding programs from previously evolved beings.

Spiced with quirky Ben Stein humor, the film shows many qualified physicists and other scientists condemned and shunned from prestigious and profitable academic circles and research grants because their scientific evidence indicates intelligent design undergirds the universe. Now these scientists aren’t necessarily radical Christians and they’re not promoting religious viewpoints. Stein is a Jew, not a Christian. The evidence just supports that the harmonic complexity of the universe couldn’t happen by chance.

Stein parallels the kind of thinking behind the shunning to bizarre mindsets we’ve see in radical, extreme socio-political movements – such as fascism. He wrestles with how easy it is to suppress freedom and liberty in America, a land where these ideals are supposed cornerstones.

When Stein focuses in on crucial questions, seeing agitated Darwinian scientists was really shocking. Those calm, cool, rational exteriors cover a very bizarre kind of mindset that’s more akin to tyranny than academic freedom.

The film opens next week. If it’s not in a theater near you, appeal to the film-masters to schedule a showing. If you get the same resistance as the intelligent-design scientists, consider hosting a public showing with other retailers to ensure your community doesn’t miss this film. It reveals cracks in the science behind Darwinism that many people believe without any personal investigation, and raises critical questions about what’s happening in American universities. Political correctness is just name-calling compared to what Stein has presented.

Consumer Study Reveals Shopper ‘Quality Cues’

What signals shoppers that you’re selling quality products?

WSL Strategic’s How America Shops MegaTrends 2008 report reveals some consistent “quality cues” that shoppers use to rank quality. Regardless of category, the hierarchy looks like this:

1. How it’s made (all natural, not tested on animals)
2. Where it’s made (grown locally, made in the United States vs. China)
3. Who makes it (well-known brands vs. unknown name vs. private label)
4. Who sells it (specialty store vs. department store vs. mass merchant)
5. High ratings by independent reviewers, such as J.D. Power or Consumer Reports, and consumer reviews written on websites (especially for electronics)

Shoppers increasingly define themselves by their choices of what and where they buy: is it natural, organic, or environmentally friendly? Who makes it and sells it? The four broad categories in the report didn’t look at books, music, and gifts, rather, beauty, clothing, electronics, and food. However, the response consistency shows deeper consumer concerns about purchasing discretion that could apply to Christian stores.

“Who makes it and sells it” is where Christian retail might fit. This is where branding builds customer relationships as customers trust stores and their vendors for the products they buy. What customers expect to find in a Christian store should at minimum align with basic Christian tenets.

Mike Hockett, CBA’s training and consulting manager, has an idea on how to express that brand trust. He suggests retailers post their mission statements in the store, maybe on a wall. Then also post logos of their suppliers who sign and agree with the store’s mission. It would be a trust statement for customers so they know what the store is about and what quality of performance is expected. You see this in some stores, like Bass Pro Shops; and recent Target ads that focused on the brands the store carries.

For specialty retailers in general, researchers say how they relate to customers in terms of quality and experience increasingly will drive store success. It looks to be the same for Christian stores. It’s the business version of “love your neighbor.”

Virtual worlds’ digital waters might be icy

Social networking has become a buzz word. “You’ve got to be where your customers are” is the rationale to spend lots of money to enter the inner sanctums of MySpace, Facebook, and the virtual world of SecondLife, among others. But even Internet mavens are warning not to jump into digital waters too quickly.

Erik Hauser, president of Swivel Media, a virtual-world consultancy firm, says organizations wanting to move into this realm must carefully consider business imperatives first.

In an Eweek story last week, Hauser said virtual-space marketing needs to be strategized like any normal marketing program, and you first must answer the fundamental question, “Why?”

Execution in non-real worlds involves much complexity, the least of which is technology applications. And, while one would think everybody lives in Second Life, that’s not the case. Hauser says there’s no critical mass, so expect challenges in technology capability, costs, and effectiveness. No standards exist here, so it’s like the Wild West, he says.

“Law enforcement is problematic.”

Michael Donnelly, Coca-Cola Co. worldwide interactive marketing director, told a National Retail Federation audience that sales isn’t really what virtual-world presence is all about now. Because virtual-world citizens control who’s there, commercial sales is not the likely outcome of the required significant investment into digital reality. It’s all about branding and supporting the brand.

Donnelly told how a Second Life Coke vending machine sells only the fun experience that associates Coke with whatever Coke drinkers do. Putting a Linden coin into a vending machine doesn’t get you a bottle, but a psychedelic presentation similar to the behind-the-machine TV commercials. It’s all about enjoying life with Coke, not buying a Coke. He said even at “meet ups,” where virtual people go to actually be human, Coke can’t bring the big red trucks. “We’re invited guests,” he says, not purveyors.

Batten Down the Hatches

The economic forecast looks a little stormy for retailers of all kinds. But Christian-store retailers have reason to be bold.

That’s not just because of Paul’s umbrella in 2 Timothy 1:7: For God hath not given us the spirit of fear; but of power, and of love, and of a sound mind (KJV) -- but also because putting sound minds to work results in practical strategies to keep you dry in rainy economic times.

For the record, some analysts think books are one of the discretionary categories that will do okay through the gale. Wendy Liebmann of WSL Strategic Retail found in her 2008 consumer survey that shoppers said they’ll buy more books. Specifically, 24% said they would buy more and 17% said they would buy less for a net 6% gain over the previous study.

Bargain hunters will be brandishing coupons and cutting corners to be able to buy what they want to buy -- or even be able to buy non-discretionary items. CBA’s Coaching and Consulting Manager Mike Hockett suggests always having something on sale in the store to attract bargain hunters. Promotional or remainder product might work as a lifejacket.

Madison Riley, a Kurt Salmon Associates retail strategist, told USA Today Feb. 28 that retailers shouldn’t stock too little of latest hot products or showcase them too late. She said retailers are working more closely with suppliers to shorten development and replenishment cycles to better match demand and changing consumer behavior. Hockett says knowing your customers can help you find backlist offers no other retailer will or can have.

Hockett recommends regularly reviewing CROSS:SCAN reports either directly or via Above the Treeline to check product-selling trends and fine-tune your store’s best-seller and core-inventory lists.

Riley and Hockett both urge retailers to get more customer feedback. Riley said retailers can’t afford to wait until a season or product launch ends to find out what customers want.

Tough times dampen loyalty, but remember why people come to your stores, Hockett says. It’s still about finding Christ, growing in faith, and sharing your faith. Past tough times didn’t affect Christian stores too much, in fact often helped boost sales as people struggled to find answers or provide solace for others. But seas have changed.

Keep tabs on customers more, Hockett suggests. Count store traffic and measure conversion rates to see if customers are coming in but not buying. Then figure out how to engage them so you can convert traffic to sales, he says.

Remember, out of sight is out of mind. Hockett says be top of mind with your customers. Don’t wait for them to come to the store, but call them, e-mail them. Do what you can to show them you’re thinking of them and that you care.

Think services. Can customers order off your web site? Can you package offers more conveniently?

Liebmann says to ask what you can do for customers. How can you help them? How can you be where they want you to be? How do you help them focus on their families and value their values? How can you show them you care?

Check with Hockett for a free consulting session if you need a little direction to batten down the hatches. E-mail mhockett@cbaonline.org.

Being Jesus in Retail Ministry

If you missed CBA’s Industry Conference, let me give you a little comparative insight based on recent customer findings from Border’s, as reported in the National Retail Federation’s Stores magazine. The $4.1 billion bookseller found customers who say they’re interested in sales and promotions are less likely to buy than those who want richer content, such as author interviews and book excerpts.

Borders studied responses to offers it its loyalty-program newsletters. While newsletter offers did create store traffic, consumers who came in with coupons were 31% less satisfied and 13% less likely to buy something compared to those who wanted content. The study’s conclusion: Bargain hunters aren’t brand loyal and people looking for something special in the store tend to be more loyal and less price sensitive.

While that’s not really news, for a big-box bookseller to say that today really reinforces what the CBA conference was all about. Specialty retail – which includes Christian stores in the grand retail milieu – are poised for resurgence because consumers are looking for something that relates to them, their desire for special experience, and their personal interests, values, and needs. It’s not all about price and transactions; it’s about store experience, relationship, and serving customers’ needs in relevant ways.

Doesn’t that sound Christ-like?

Who could do that better than Christian stores? What came from the conference speaker platform is hope for stores who better engage their customers and create experiences that can’t be duplicated elsewhere.

How does that happen? Some of it depends on the creativity and innovation of retailers who know their customers, some of it depends on allowing customers to help co-create the experience and the products through store engagement, and some of it requires better communication, coordination, and understanding between retailers and their supplier trading partners.

Speakers presented case studies of successful retailers who discarded the traditional and routine to bring expectations of surprise, quality, unique products, overboard service, and personal interaction.

What’s surprising about your store? How do customers feel when they visit? One of the speakers, a self-proclaimed Christian mother, said she doesn’t visit her local Christian store anymore because she felt intimidated by the language and expectations put on her.

So I guess the question is: How do you be like Jesus in a retail ministry?