Macy’s, a retail giant looking for a turnaround

Please share!
Recover the customer’s experience in store is one of the goals of the Macy’s real state strategy goals for 2017.

The American retail industry has been suffering considerably in the last decades. New technology, fast changing consumer tastes and a market that has been making seasons shorter in order to sale more, it’s making big retailers such as Macy’s work harder to keep their inventories and businesses on track.

About new technology affecting the way retailers see their business, The Economist (February 11th, 2017) said that during 2016, one fifth of the trading happening online was generated by purchases of clothes and accessories. And analysts expect that Amazon will surpass Macy’s sales this year.

Additionally, the fashion industry as a whole has been speeding up change in trends searching more profit. In contrast, department stores suffer because of the slow pace that the business implies. Inventory stays longer on stores and discounts are heavily impacted by negotiations between retailers and manufacturers. When the stores finally put items on sale to rotate inventory, margins shrink and their performance suffer. This strategy has affected and seized the entire industry.

In January 4th, 2017, Macy’s, the biggest American retailer, announced actions to execute real state strategy which includes closing 68 stores in order to reorganize the company’s structure and reinforce the remaining stores, focusing on customer’s satisfaction with the in-store experience. In Southern California, the company had already close one store in North Hollywood and is expected to close three more in San Diego, Santa Barbara, and Simi Valley. In February 21, the WSJ said the company earnings for the quarter that includes the holidays seasons sales dropped by 13 percent.

To counteract the declining of their business, Macy’s is opening outlets called Backstage, most of them inside current stores. This strategy, still on an early stage, with most of the stores located on the East Coast, seems to be a successful but rather late answer to the market change. Additionally, online sales still offer room to improve for the company. A better online merchandise, and a wide variety of discounted products that appeal to younger generations may help the company in improving its online market share.

In conclusion, a smaller Macy’s, with less stores and a more aggressive online activity may be the marketing strategy to save the largest American retailer and keep it thriving as one of the industry leaders.

Please share!

Zalando, shaping Europe’s online retail business

Please share!

Zalando has become Europe’s biggest seller of shoes and clothing. The company started as an online site that sold flip flops in 2008, and quickly became the most important fashion online platform in the continent.

As the company’s website claims, Zalando goes one step further the traditional retail and catalogue sales by offering a broad selection of items with the benefits of their custom care process, company owned logistics centers, and unlimited opening hours.

Traditional retailers in Europe, as in the rest of the world, are seeing their customers walk away from their stores to shop online. In contrast, Zalando was one of the pioneers of the e-commerce and has grown into a giant, with increasing sales at a rate of 30% a year, in 2015 the company sold $3.3 billion. Zalando makes it easier to buy online even for customers in those countries where e-commerce is still a novelty. For example, in Italy and Poland shoppers can pay the postman in cash.

But not all retailers are racing against Zalando, some are starting to join the giant like the British retailer TopShop with whom Zalando started an alliance in 2014 and boosted sales with a popular tv commertial featuring Cara Delevigne.

Watch TV commercial: Cara Delevigne for TopShop and Zalando

Investors are also happy with Zalando’s performance, in the last three years the company’s shares have risen from €20 to around €40.

One key for this success was their TV commercials campaign that started in 2010 and quickly gained public attention. Using humor for the early commercials and then well-known models for the recent ones, the company reached almost 90 points in brand recognition in Germany.

Zalando’s competitive advantages are constantly underlined on their marketing campaigns: excellent logistic center that provides on time delivery, payment and customer care tailored to each country or market, and free returns are some of the constant themes not only on the tv commercials but also on their webpage and online ads.

With more than 5 million daily visits to its site, Zalando has also became a specialist in managing big data. The company uses this data to forecast change in fashion trends as well as to evaluate their marketing campaigns impact on sales.

The future for Zalando however, may not look as bright as their present. With big competitors entering the European market, such as Amazon and Alibaba, the company has to keep their customers engaged. Strategies that they may keep using are their very attractive online merchandising, and their ability to customize their operations in each different market to attract customers with different purchasing styles.

Please share!

Rapid Growth of E-Commerce in Ukraine

Please share!

http://www.kyivpost.com/content/business/e-commerce-finds-prospects-in-mall-dominated-retail-market-374878.html

The Ukraine’s e-commerce industry has grown by 25 percent in the last year. The rapid growth is due to the added convenience of ordering online. As we’ve seen in the United States, ordering online is an easy way to get exactly what you want delivered directly to your door. There is no need to leave the house, this added ease of shopping also contributes to higher sales as the products presented for consumer purchase are endless.

download

 

Online shopping makes customers feel good for other reasons aside from the added convenience. The internet makes it simple to compare prices of the same item sold at a variety of stores. This way, the consumer can get the best deal on what they want. There is no need to worry or any added hassle to purchasing from different locations as you can do it all from home. It also allows stores to reach consumers from all around the world without having to travel there.

Particularly for the Ukraine, this spike in e-commerce is seen due to the rising prices of land. It is becoming too expensive for shop owners to have physical locations so they are resorting to moving their stores online. There was also a worry to buy land due to its instability so only larger retailers were having physical estates. Although, existing retail stores are staying where they are due to the value of the land and location. So, the physical store sales are still higher than those online.

Print

Among all of the subcategories within e-commerce, technology and electronics sales seemed to grow the most. Along with these items were airline tickets and the fashion sector, both taking up large sections of e-commerce sales.

While e-commerce is a booming business in the Ukraine, there are still kinks that need to be worked out. The biggest seems to lie within the payment systems customers are going through when purchasing online. There is low confidence in wanting to share their information or that they will have protection and reassurance so many are still skeptical to making the purchase.

Please share!

Merry Marketing

Please share!

http://multichannelmerchant.com/marketing/tis-season-put-global-marketing-plan-place-14102014/

 

During the holiday season, businesses have the opportunity to make or break their end of year sales. Typically, this is the time customers are buying more that any other time of the year. It is crucial that company’s nail their holiday promotions to get the most out of eager yuletide shoppers worldwide. Expanding marketing efforts internationally can nearly tripe the amount of sales generated during this season. It is important to keep in mind that countries will react differently to the same marketing campaign. In addition, learning which holidays are celebrated in each location and what their dates are. This will be key as well in knowing when to launch holiday advertising.

Shoppers are always enticed by a sweet deal. Offering things that are low cost to the company best. Things such as flat-rate, express, or even free shipping are a great way to draw shoppers to a website. While offering a shipping in general is great, it is often even more profitable to give shoppers an incentive to spend a certain dollar amount, say $50, before they can get the shipping deal. International shipping fees tend to skyrocket so this is a nice way to make shoppers happy and more likely to spend.

Next comes  the actual message you are sending globally to customers. A clear message is necessary to make a lasting impression amongst the many other holiday advertisements. It also needs to align with your current brand. A company does not want to change the message they’ve been sending all year so consistency to this point is key. It is also important to include any sales or deals. Customers need to know the facts and that includes the deadlines to receive their gifts before the big day as those will differ depending on the country.

Reaching the market through the television or physical advertisements are only one aspect of a successful campaign. Reaching customers by email is key. This is a low cost way to keep buyers up to date with what the company has to offer. Keeping these email informative on the products while also having some entertaining material will be the difference between a quick glance and someone taking the time to read the email. A company will not only survive the holiday season but come out on top with unique and globally entertaining advertising.

Please share!

Mulberry Chooses the Wrong Strategy

Please share!

Slow economic growth and political instability in China, Russia and the Middle East has led to a clampdown in spending which in turn has had a catastrophic effect on luxury brands. Consulting firm Bain and Company recently stated that this slowdown will put the brakes on the global luxury goods sector for some time, with many brands reigning in any rapid expansion plans. Of course, some of these brands will be effected more than others.

mulberry

Mulberry is one of the companies in real danger. It has issued numerous profit warnings in the last two years and retail sales in the UK have slumped by 12% in the past two quarters. This could be due, in part, to the loss of their creative director Emma Hill and the subsequent leadership of Bruno Gallion. He arrived from Hermes aspiring to take Mulberry down a more traditional luxury route, concentrating on high end expensive handbags. This strategy immediately backfired, as it placed the brand in direct competition with global giants such as Louis Vuitton. As a true example of the 4 Ps of marketing, the PRICE adjustment was the true flaw in the new strategy. Not only could the brand not compete with the dominating competitors, increasing its price point put the brand out of reach, which alienated its core consumer. Mulberry doesn’t have a strong enough brand to justify their price increases, and as a result consumers started opting for the more established luxury labels.

louis vuitton

However, now Godfrey Davis is now at the helm, and the brand is seeking to reposition themselves back in the middle market, all while they are still looking to appoint a new creative director. Though it is still possible for them to turn around, to succeed Mulberry needs to keep its core customer at its heart. The strategy should aim to appeal to its core market, which for the brand is an upper-middle class female. By trying to change their marketing strategy to move their image from a domestic luxury brand to a global one, they have failed to maintain a valued high-end image in most markets. Can Mulberry move back into their original market share, or is it too late?

Please share!