Archives For October 2013

Best Buy is in the middle of a dramatic turn-around. A year ago it appeared that Best Buy was destined to become another Circuit City and slowly go out of business. They simply couldn’t compete with Amazon, Wal-Mart or Target.

In December 2012, Best Buy’s stock price fell to $11.20, a nine-year low. December same store sales fell 1.2% as holiday discounts failed to attract shoppers. The company suffered from poor leadership, high internal costs and was not competitive on price.

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What a difference a year makes. The press couldn’t have been more negative about what was going to happen to Best Buy this time last year. Recently Best Buy’s stock closed at $42.92, an impressive 383% increase from its low in 2012. The company has pulled off a dramatic turn-around which started with a leadership change. Late last year Hubert Joly replaced Brian Dunn as the CEO.

Joly launched the “RENEW BLUE” strategy which is designed to make Best Buy the preferred authority and destination for technology products and services.  This strategy focused on more competitive pricing, improving in-store experience and internal cost reductions. Over 400 job were eliminated in the corporate office. Joly has implemented a store within a store model, striking exclusive partnerships with Samsung and Microsoft to establish in-store shops within Best Buy stores.

Best Buy has also made it its mission to match Amazon and other e-commerce sites on price. They are committed to being price competitive. In the past they have struggled with being a showroom for Amazon. “Showrooming” is when consumers use physical locations to see and try the very latest technology, but then go online to find a better deal.

Retailers, as you can imagine, aren’t fans of the practice. The near-term future for Best Buy depends on convincing consumer’s that their stores can be the best showroom. Best Buy is attempting to turn that weakness into a strength, embracing the fact that having stores work as showrooms attracts curious shoppers.

Best Buy recently launched their holiday advertising campaign which promotes their stores as “Your Ultimate Holiday Showroom”. New television spots highlight the experience consumers get at Best Buy — online and in-store — while touting things like its “low price guarantee” and the ability to order online and pick up in store.

Best Buy has made great strides in turning their business around in a short period of time in a very competitive environment. It will interesting to see if their new strategy succeeds long-term.

Have you shopped in a Best Buy store recently?

We are in the middle of the second running boom in the United States. The National Sporting Goods Association reports that sales of running/jogging shoes increased 23% percent in 2012 when compared to 2011. Running represents about a third of the overall sneaker market. Serious runners purchase on average three pair of running shoes a year. The running industry continues thrive despite a sluggish economy.

Participation in running has seen a steady increase in recent years. Running participation (ran at least 6+ days/yr) was up nearly 4% overall in the last year. Adventure running has experienced explosive growth. Events such as Tough Mudder have increased in popularity. Adventure running grew 34% last year. Marathon entries have more than doubled over the past 20 years. More and more women are taking up running. I see it in the size of our local high school’s girls cross-country team. Women accounted for 8.6 million finishers in road races in 2012 compared to 6.8 million men.

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The running shoe market is highly competitive. The top running shoe brands are ASICS, Brooks, Nike, Saucony, New Balance and Mizuno. Brooks has experienced impressive sales and market share growth in recent years. This was fueled by a shift in marketing strategy. For years, Brooks had tried to be a total athletic company like Nike, selling football cleats and a wide variety of sports apparel. Their athlete roster included Dan Marino, James Worthy and Jimmy Connors. They tried to compete with Nike at their own game. That turned out to be a losing proposition.

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About ten years ago, Brooks Sports under the leadership of CEO Jim Weber made a strategic decision to focus on performance running shoes and gear. Brooks eliminated football, basketball and tennis products. Distribution was focused on top running and specialty retailers. This has proven to be a winning strategy.

Many marketers mistakenly believe that more products sold to a broad target audience is the key to growth. Brand Strategist and Author Al Ries in his book “Focus” outlined the premise that long-lasting success depends on focusing on core products and resisting the temptation to diversify. Brooks has successfully executed a focused strategy.

Brooks has developed a simple slogan: “Run Happy.” which defines the brands connection with employees and runners Employees at Brooks live and breathe “Run Happy”, through expression of brand values:

  • Serve People 
  • Lead Thought
  • Play As a Team
  • Compete Every Day
  • Have Integrity 
  • Have Fun
  • Be Active. 

What is your favorite brand of running shoes?

Levi’s has one of the best stories of any brand in the United States, if not the world. It is an iconic brand. Levi’s is the original blue jean. It has an incredible heritage and is a symbol of youthful rebellion. Levi’s always worked hard to balance making profits with doing the right thing. Strong core values informed how business was conducted. The company gives back to the community and supports many charitable causes. Levi’s is a leader in sustainable manufacturing and responsible sourcing.

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This week, the Levi’s Brand announced that it was parting ways with its advertising agency Weiden and Kennedy after a five-year-stint. The brand has struggled in recent years and stopped growing. It has had a series of leadership changes. The brand has lost touch with its core purpose. Levi’s has failed to engage and inspire consumers with meaningful stories. As a result, Levi’s has struggled to stay relevant with consumers.

In recent years, the brand has tried hard to regain relevance with younger consumers. Many of their recent marketing campaigns have tried too hard to be cool and often seemed very exclusive. Much of their recent advertising feels dark, somber and not for me. The classic Levi’s 501 Blues Campaign from the 1980’s connected emotionally with a diverse audience of consumers on multiple levels. More than anything it was an inclusive campaign that made people feel good about the brand.

Twenty years ago if you visited a high school or college campus, you would see Levi’s Jean everywhere. Levi’s was clearly the blue jean brand of choice. Today if you visit a high school or college campus you see very few pairs of Levi’s being worn.

Rather than hire an advertising agency, I recommend that Levi’s hire a Brand Journalist to help them connect the stories of their past with the stories of their current users. The brand’s loyal followers have great stories. Its time Levi’s told the stories of its most passionate customers and stopped trying to be cool. It is a great story, tell it in a simple inclusive way.

I worked for Levi’s in marketing for nine years. I am passionate about the brand. I hope they turn it around.

What is your favorite brand of blue jeans?

Brand Marketing is undergoing a fundamental change as new media channels emerge. Bombarding consumers with “sell, sell, sell” advertising and direct mail no longer works like it used. Response rates continue to decline. The same old same old doesn’t work anymore. Consumers are tuning out blatant sell messages. They no longer buy what you do, they buy why you do it. Consumers want to understand your story. People want to support companies with a purpose beyond just selling me stuff and making money.

Today, consumers have a wide variety of media channels where they can research products and services. More and more brands are engaging consumers with authentic stories that matter. These stories inspire and inform consumers. Brands like Zappos, Dove and Chipotle are excellent storytellers with a customer focused purpose. They understand that brands today are in the publishing business. Owning your own media channels is important for success. Storytelling is the essence of Content Marketing.

This morning, I had the opportunity to hear John Robinson speak at a New York Capital Region AMA event in Clifton Park. John is a master storyteller. John’s stories are engaging and inspiring. He also has a great sense of humor. I don’t remember many of the commercials I saw on television last night but I will never forget John’s stories and inspirational message.

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John Robinson overcame countless obstacles to become a successful entrepreneur, family man and inspirational keynote speaker. John is a congenital amputee born without full arms and legs. John stressed how important it was to be comfortable with who you are.

John told the inspiring story of his bicycle ride across New York State which he called the “Journey Along the Erie Canal”. John, his family and Doug Hamlin completed a 17 day bike ride from Buffalo to Albany in July of 2013. Their purpose was to raise awareness of the ability inside all People with Disabilities and to raise funds to support Adaptive Sports, Accessibility, Education and Employment for New Yorker’s with Disabilities. Through his organization, Our Ability, Robinson mentors, connects, and inspires people with disabilities toward education and employment. They were greeted by local politicians and enthusiastic supporters along the way. They overcame many obstacles including rough trails, extreme heat, rain and sore muscles. As Doug Hamlin, John’s partner and guest speaker Doug Hamlin so aptly stated, “Things that look like a disadvantage are an advantage”.

The audience was inspired and engaged by John and Doug’s story, their sense of purpose and how they used Social Media and Content Marketing to distribute their story. They will likely remember the inspirational stories John and Doug told for years to come.

Can you share a story that inspired you to overcome an obstacle?

I am currently reading Ann Handley’s book “Content Rules”. Content Rules is a guide to engaging customers through great content. It is an excellent book. Ann is the Chief Content Officer at Marketing Profs. Ann is a leader in Content Marketing and a frequent keynote speaker at marketing conferences around the country.

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Ann is a journalist with an engaging and human writing style. In her book, Ann highlights Eighteen Business Buzzwords We Need to Ban Because They Make Us Sound Like Tools. I have used many of these buzzwords in my own communication. I suspect we all have.

I thought it would be fun to share these buzzwords and hear your feedback. The Eighteen Buzzwords are listed below:

  • Impactful
  • Leverage
  • Learnings
  • Synergy
  • Revolutionary
  • E-Mail Blast
  • Proactive
  • Drill down
  • 30,000 feet
  • Incentivizing
  • Solution
  • Users
  • Ping
  • Granular
  • Buy-in
  • Run it up the flagpole
  • Brand Nazi and Drinking the Kool-Aid 

Can you think of any other annoying business buzzwords that we could do without?

Many business people confuse marketing and branding. Most people don’t understand what a brand is. Many people think that branding is a logo or a logo design. Design is essential but design is not a brand. Some people think that you can whip up a brand overnight and build awareness instantly.

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For me branding is simply about “Keeping Your Promises”. Brand’s like Zappos and Apple are known for delivering a great experience for consumers. Great brands consistently deliver on their promise. Great brands tell stories that are focused on why.

Branding is delivering on a differentiated promise to a consumer. No matter what you are doing, you are always branding your business. Branding is the perception, thoughts and emotions of your consumers.

Branding is a strategic asset, and shouldn’t be viewed as an expense. Marketing is an expense.

Branding is long-term. When we are clear about a brand building strategy we can direct the marketing tools. Without a proper brand building strategy, the marketing is a tactic in search of a strategy.

Marketing is focused on achieving short-term goals. Marketing usually services one main overall function, to sell.

The Brand is how people remember you, how they feel about you.  Emotions and memory are key components to the brand. Marketing then takes that brand and forms communication that takes advantage of that brand to send out a message.

The great thing about a Brand is that it can be constructed and formed to create that unique memory and feeling you wish to appeal to your specific target.  By clearly defining things like purpose, core values and personality you can create a brand positioning to use as a guide for effective marketing strategies.

Marketing communications not based on a well-defined brand send a message that is not differentiated. A great brand deserves a creative marketing strategy to best take advantage of that unique positioning.

Marketing is a “push” action, and branding is more “pull.”

A Brand is an experience, a story.

Which brands provide the best customer experience?

Yesterday I attended a Social Media Tech Valley Breakfast event at the Troy Savings Bank Music Hall in Troy, New York. It was an excellent event. It was my first visit to the Troy Savings Bank Music Hall, which is a wonderful venue with a great story and heritage. It is notable for having a music hall constructed on the second floor above the bank itself. The Troy Savings Bank Music Hall is world renowned for its near perfect acoustics. In another post, I will tell the story of the Troy Savings Bank Music Hall, one of the gems of the capital region.

I was impressed by the presentation given by FarmieMarket founder Sarah Gordon. Sarah had a great story to share about the founding and growth of FarmieMarket, an online farmers market.

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Sarah is a third generation farmer who grew up on the family farm in Knox, New York. She lived first hand the struggles and simple pleasures that come with a family farm. After college she knew that she wanted to do something that promoted sustainability and paid tribute to the knowledge she picked up on the farm. Living in downtown Burlington, Vermont, she was inspired by the prevalence of active farmers’ markets, local foods restaurants, and the agricultural community in the urban environment. Burlington was the first place she had ever been where the small farmer was King, and she knew she wanted to replicate feeling back home.

Sarah had two unique insights that has helped build her business. Consumer’s were hungry for fresh, local food but often too busy to visit the farmer’s market every week. Most families with active children fall into that segment. Sarah also understood that small local farmers were time constrained. Local farmers were too taxed by the day-to-day challenges of farming to market themselves.

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In January 2010, she began marketing her family farm’s products online, using social networking tools. The concept caught on. From there, she began talking to other farmers she knew and offered to help them to market their products by building synergy amongst local farmers in a central, internet-based market place.

In June 2010, Gordon founded FarmieMarket, an online farmers market where Capital Region consumers could order fresh produce, eggs, meat and more from local farms and have them delivered directly to their door. Catering to the needs of time-strapped consumer and farmer has proven to be a good business model.

The goal was to help family farms make their businesses viable by expanding their access to a broader customer base. The small farms she works with have limited resources and often cannot take the time away from the farm to go sit at a booth at a farmers market (especially not knowing how much they may actually sell).  By marketing on behalf of family farms online, farmers save time and money and reach a broader customer base than may be at a traditional farmers’ market.

The concept is simple and convenient. Local farmers list what items they have in stock on the FarmieMarket website, where shoppers can order online. Once a week, Farmie Market makes deliveries to consumers, while also marketing products on the website to help farms attract more business. Farmers set their own prices and Gordon adds her own operating costs on top of that. Shoppers only have to place a minimum delivery order of $25, plus a $5 delivery charge.

FarmieMarket’s mission is easy to identify with and support:

  • Improve small family farms profitability and economic sustainability.
  • Provide naturally grown, organic and local food to families and individuals.
  • Offer local customers a modern, convenient service.
  • Improve rural and regional economies by recycling customers’ food dollars with local farms and small businesses.
  • Create and maintain jobs on farms, in small businesses and amongst entrepreneurial local food leaders.

FarmieMarket is a great example of an entrepreneur following a passion who understood the jobs that consumers and farmers are trying to get done. Sarah has done a great spreading the word about FarmieMarket through content marketing and social media. I wish her continued success.

Have you purchased farm fresh vegetables online?