Wednesday, October 27, 2010

On Target for Stella sales

Stella McCartney appears to be nearly as popular as her old man - if Australia's leading shopping show, A Current Affair, is any guide. Consumers are just busting their buns to batter down Target's doors and grab a fashion 'name' at a bargain price.

The Stella McCartney strategy of delivering style at an affordable price through a suburban department store chain has been an outstanding success. The reason - exclusivity for Target, street smarts by Stella Mac and her marketing / distribution team. Don't be too proud to sell alongside 6-packs of undies and socks and the kids' toy section. That's where Mums go all the time - lots of eyeballs fine-tuned for style at a discount - and a personal treat.

Compare this story with the Myer and David Jones scenarios, where leading brands battle cheek by jowl for prominence and space - and pay a premium price for the privilege. At the retail level, both David Jones and Myer have invested substantially in upgrading and updating the real estate in which these battles take place. For them store experience is a big marketing focus.

But all Target has to do is do a bit of publicity work about Stella Mac's new range being in the store. No expensive fitouts - just more racks of cloths. And Target's in the 'burbs. 'I'll drop in when I go for coffee.'  I expect we'll see lots of Stella McCartney, or at least her products, over the next few weeks as Melbourne's Spring Racing Carnival hits top gear.

Oh. By the way. Did I mention anything about nice timing, Stella?

Tuesday, October 26, 2010

Confusing and impenetrable - call in Bear Grylls!

Do you even watch Man v. Wild on SBS? Our hero with the titanium-lined digestive tract, Bear Grylls, parachutes into some remote, hostile location and then finds his way through and out. I've never seen him fail to overcome the odds.

It seems people who have superannuation accounts identify with this show. According to new Government Super Supremo, Bill Shorten, just-released Australian Treasury research shows consumers face a superannuation landscape that is similarly confusing, complex and impenetrable.

That's why Bill's all in favour of MySuper, a much simpler landscape where superfluous investment options, insurance choices and other paraphenalia requiring consumer decisions are bulldozed to allow a clear view to the retirement horizon. The theory is that people will be able to more easily get their bearings.

MySuper - would Bear Grylls approve of it? No investment swamp lands to wade through, no barbed fee structures to hack through, no insurance wilderness to traverse. No need to climb to the high ground of financial advice to get his bearings. An armchair ride to retirement nirvana. Right?

Wrong! People will be disengaged and have no more idea under MySuper of how they're tracking than they do now. They will have no better idea of whether their lifelong investment is going to deliver their retirement lifestyle objectives. Knowing this requires engagement, whether in MySuper or any other investment product.

In Man v. Wild, our hero always ends up discovering a clear path back to civilisation. But the important thing is that, to survive and thrive, to find the path home, Bear Grylls fully engages with his landscape and the challenges it throws up. Through engagement, guidance from his survival training and expert advice, he makes it. Disengagement would be fatal. To varying degrees, this is true of most things in life.

Friday, October 22, 2010

Service with a sale

Old car dealers never die, they just see opportunities. My wife bought a Lexus a few months back. Nice unit with fairly attractive lines - that is until an almost octogenarian truck driver running errands for his son's business decided to hook the rear boot lid of my wife's parked car under his trailer and drag the hapless Lexus into the car parked in front of it. 13 big ones worth of damage!

As the car was new, the boss took it down to the Lexus dealer to have them double-check that there was no underlying damage that the panel beater might miss. Nope. All good. Just make sure the four points align and she'll be right. Their much-relieved customer drove off in her mutated Lexus until ...

Yep. Today the car dealer was back with a bit of extra service advice. For only $16,000 she can trade up from her current new car to an even more current new car ("2011 model" - where are the compliance people on the car industry?). The opportunity to capitalise on the customer's disappointment at having a shattered new car was not lost on this guy!

I'm working through this weekend, afraid to go home in case she's accepted the deal. Talk about service with a sale!

Twitter failures

I searched 'superannuation' in Twitter the other day. It's a sure-fire way of discovering a whole flotilla of dudes that just don't get it. The biggest culprits are those tweeting and retweeting (their own tweets) promoting self-managed superannuation funds (SMSFs) or DIY super opportunities.

The first page of the search is just full of them. Am I deluded, out of the loop or retarded when it comes to how social networking is supposed to work? I thought it was supposed to be all about dialogue, or at least trying to promote dialogue with other twitterers.

Perhaps we need to go back @DIY super or @SMSF types and tell 'em it just ain't working for us (or them!). Perhaps a conversation at @DIYtwitter might be a good dialogue to open up. But right now, anyone looking for useful information on super on Twitter would be best to find other search terms than the logical 'superannuation', or at least consider filtering to exclude all references to 'DIY' or 'self' in the search.

Thursday, October 21, 2010

Why brand presentations don't work with the beancounters

I am becoming an absolute conference junkie. At least that's the way it feels at present, having attended about three in two months. Another year to the next one of any interest though, so I'm off the hook for now. The great thing is that they're a rich source of raw material for blogs.

At a recent conference, I saw a few brand / marketing bods presenting their thoughts on, well - branding and marketing. And from this experience, I have to ask one thing: Why do brand / marketing presentations always include 'illustrative' TV ads feeding from YouTube and other sources? The old Apple 1984 advert, a quirky European car ad and perhaps a 'zany' financial services advert from a nation noted for its weird sense of humour.

There's something awfully wrong, not to mention tedious, about all these presentations. First, they promote the notion that TV is still the primary driver of brand awareness. Yes, it's still a powerful presence, but TV does not define brand - just ask Google. Secondly, they never talk about important things that 'sell' the importance of brand to the collections of lawyers, accountants and MBAs that adorn corporate boards. Where is the information about setting up brand metrics for your organisation, about measurement, about translation of brand values into dollar value?

Unfortunately, when we go to financial services conferences, well attended by the aforesaid business technicians, these presentations merely reinforce the view that the brand and marketing dudes have no concept of improving the bottom line. You can see and hear the cranial cogs turning: "Nice ads. Bet they cost a bomb. Hope there's none of our marketing troop here picking up crazy ideas about funding similar ventures."

Yep. I really disappointed with brand presentations that reinforce the stereotype image of the marketing team. They contribute nothing to promote marketing and, more particularly, brand specialists to company boards. They do even less to promote marketing as an investment and not a cost.

Thursday, October 7, 2010

Consumer advice from.... the land of the zloty?

My first clue that I was reading tech product reviews on a site outside of the US was when I read words along the line - 'when the difference in price is something like 1,500 Polish Zloty". At first, not having heard of zlotys before, I thought it was a wind up. That was until I ran across the zloty again on another page and more thoroughly investigated the website.

Sure enough, I was reading sophisticated camera lens reviews on a Polish website, If you're in the market for a camera lens, check it out. Unlike a number of the others on this subject that I have visited, this one is full of lab test information on optical and mechanical performance, as well as commentary on performance in the field.

So, after buying a new camera body in Singapore en route from Thailand, I am sourcing information from a Polish website on the performance of products made in the USA, Malaysia and China. To round off this global shopping experience, I am a consumer based in Australia! And if I buy off ebay, then I could well source the purchase in Hong Kong or Taiwan (then again, I probably won't!).

Apart from the obvious implications for retailers, this experience raises an interesting point about how so-called international warranty undertakings have fallen behind borderless consumerism. Given that we consumers do shop globally, when are the 'big brand' manufacturers going to offer truly international warranty on their products? I went to register my camera purchase on the manufacturer's website in Australia and couldn't because I'd bought in Singapore. When I tried to register on the Singapore site, it wouldn't let me because I wasn't a resident of Singapore.

What a nonsense this is. I bought exactly the same product, same specification and, I believe, one substantially priced the same, if you ignore taxes and duties, as I would have done in Australia. So what makes warranties less valid on a product across national boundaries?

If we're happy to distibute globally, then we should be able to offer appropriate customer protection globally, despite the considerable variations in consumer protection legislation between nations, or some bean counter's neat international accounting structure.

If we could be fearless about the validity of warranties, then we could all buy genuine brands over the web or on our travels confident about the integrity of product and service that go with the brand.

Monday, October 4, 2010

Let's promote the NDS - Net Detractor Score!

Call me just one of those crazy financial services guys if you like, but I think we need to remove the parentheses around the Net Promoter Score (NPS), reflecting a negative, and rename it the Net Detractor Score, NDS, so we can all score a positive.

What prompted this momentary lapse of reason was that I revisited a financial services industry survey the other day which showed none of the surveyed organisations scored a positive NPS. I'm sure that's why the research bods servicing this sector go out of their way to make us feel better about ourselves - as well as justifying more expansive research methodologies. They tell us the NPS is not much of an indicator in financial services because people want to retain long-standing friendships by not recommending anyone put their lifelong savings into XYZ Investment Manager.

The other thing that prompted this blog was a mailed invitation from the Fund Executives Association Limited to attend a Net Promoter Score workshop later this month, where several bods will evangelise about how using NPS had transformed their businesses. Only one of the facilitators is from the financial services sector and none from funds management or superannuation.

Chief convenor of the meeting is a marketer and academic for whom I have enormous respect, Prof. Mark Ritson, from the Melbourne Business School. Mark is a passionate advocate of NPS, so I fear I'd be a luddite in the land of the fairies should I attend this gig.

My problem is that in the funds management and/or superannuation business, just about everyone is on the nose since the GFC. This isn't helped by a not-for-profit sector that basically tells everyone that financial advisors who receive commissions are ripping them off and investment markets that refuse to stop bouncing around. GFC + Outrageous Fees + Uncertainty does not equal passionate consumer advocacy for the sector!

I've heard friends and relatives saying such and such a company lost their money during the GFC. How does your average 20-something call centre dude convert someone with that perception into an evangelist? It takes more than soothing words, nice phone manner and an attractive website.

Most NPS scores that I've seen for everything from banks to investment funds are languishing in the minus 20 to minus 60 zone. These scores wouldn't have customers queuing at the counter even if you were selling ice cream cones in Noosa on a hot day. Yet financial services businesses seem to live with these scores year over year.

I am in bed with the research bods at the moment. I think the NPS is an interesting, but fairly useless measure in financial services, unless considered in relative terms.

But, as always, I'm open minded about these sorts of issues. So I'd better register for the FEAL gig I guess because, right now, I'm not improving the NPS for NPS.

Friday, October 1, 2010

The IP cops fail the test in Thailand

As promised, I return from a brief sojourn to Thailand to report on the state of play with regard to intellectual property theft - more simply described in layman's terms as the counterfeit watch business. I am pleased to report that this trade is thriving in Thailand, a veritable nightmare to the brand police at LVMH and other notable designer goods companies.

It's clear that all attempts to stamp out patent and intellectual property infringements have virtually been abandoned in Thailand and, most likely, most other developing countries in which this is happening. The only token response that I witnessed was a sign at the check-in desk at Phuket Airport saying that France and Italy could impose severe penalties on people found carrying fake designer goods into their countries. It was notable at the time I joined the queue that none of the international departures from Phuket were heading to either of those destinations!

The most interesting aspect of all this is that, at point of sale, shop proprietors take great pride in informing you that you're checking out fake gear. In fact, there is a degree of incredulity that you would consider buying the real thing, when you can get the fake for a fraction of the price.

But if I can offer any encouragement to the designer brands out there, my close inspection of many goods (none of which I bought!) indicated that the quality of fit and finish is nowhere near that of the real thing. I won't go into why I was looking at handbags - suffice to say it is simply inevitable if you're travelling with your household's female purchasing officer - but a number were already losing paint around the piping and glued parts had come adrift.

Then again, who cares, when you can buy ten and use each once before discarding it? In fact, these are arguably the perfect female accessory. You need never be seen carrying the same bag twice! And hey - if you're travelling to Italy or France and things get a bit dodgy in customs, you only lose about twenty bucks when you hastily discard the 'Louis Vuitton' purse into the nearest trash can.

Well, I'm just about out of time for writing this article - at least I think I am. The $20 Rolex has just died. I hope the Cartier's still working at home! It's a fair bet that, by the end of next week, I should be back to wearing the genuine Ebel purchased in Australia!