business news in context, analysis with attitude

By Kevin Coupe

In addition to writing MorningNewsBeat each day, Content Guy Kevin Coupe also contributes regular columns to a wide number of publications, including Chain Store Age. As a regular MorningNewsBeat feature, the folks at Chain Store Age have graciously agreed to let us reprint some of these columns.



Few things annoy me as much as whining.

Don't like it when my kids do it, and I don't like it when I hear it coming from retailers.

Of course, for the moment I can have some impact on my kids when they whine. "What is it," I ask, "about our relationship that has convinced you that whining will have any sort of effect on me?" (Okay, I admit it. This doesn’t work all the time. But occasionally they actually pay attention…)

It is time to ask retailers convinced the commerce gods have dealt them a bad hand this very same question. Because guess what? Nobody owes these folks a good break. I've checked, and the Bill of Rights has nothing in it about being guaranteed success. You have to work at it each day, each hour, with the knowledge that even that may not be enough.

You go to enough conferences and conventions, and eventually you become inured to all the complaints. (What exactly did all these folks complain about before Wal-Mart?)

Occasionally, though, you bump into little guys making a success of themselves. Interestingly enough, I've noticed lately that a number of these folks are doing it by focusing on a kind of sampling…which only makes sense. They get the product out there, whatever it happens to be, and good things happen.

I've been reporting about the food business for a lot of years, and always have argued that if retailers put it out there and it smells good and tastes good, customers are a lot more likely to buy it. By and large, though, most retailers only sample when manufacturers are willing to pay the freight, which ultimately means that they are doing for the promotion dollars, not as a way of selling new and good stuff to consumers. Yes, once again retailers are making money on the buy, not the sell. Which all by itself ought to disqualify them from whining.

(By the way, the retailer doing the best job of sampling these days seems to be Costco. A membership club store. Not a food store. Go figure.)

But I digress…

Take for example, a company like New Balance, which is both a retailer and a manufacturer, and will never, ever be as big as Nike. But New Balance has a great "sampling" program connected to its website, which allows people to be "wear testers" - we get free sneakers from the company, wear them for a period of time, take notes, fill out a questionnaire, and send them back…eventually getting yet another pair. Yes, I'm one of these wear testers - and while I've worn New Balance shoes that were both good and bad, I'm a loyal faithful customer. (Nikes haven't ever touched these feet.) And, I tell everyone about what a terrific deal the testing program is, rave about the shoes, and generally am one of the company’s best ambassadors.

Or, how about Apple Computer, which has turned its Apple Stores into retailing events. These stores are filled with every gadget Apple has to offer, and consumers are encouraged to play, to experiment, to test the limits of the equipment. And it doesn’t just appeal to Apple devotees - I know Windows users who have been completely turned on by the experience. When Apple recently opened a new store in San Francisco, just off Union Square, the line went around the block on opening day, and they couldn't keep the new mini-iPods in stock. Apple may never be IBM or Dell…but on the innovation front, it is a company worth emulating. If you can't be the biggest, perhaps being the most innovative is a good alternative.

(In the shadow of that bustling Apple Store, by the way, was a big, empty store with a distinctive sign - FAO Schwarz. A couple of bocks away, there used to be an Eddie Bauer flagship store. But no more - because they couldn't compete in the cutthroat environment of 2004 retailing. But I digress again…)

The other day, I went to an author breakfast sponsored by a small bookseller in a nearby town. I was there to hear Robert B. Parker, the prolific author of the Spenser novels…but I also ended up hearing from Linda Fairstein, who writes mystery novels about a homicide/sex crimes investigator in New York, and Ian Rankin, a Scottish mystery novelist with a huge following the UK. I wasn't really familiar with their work, but they talked enough - "sampling" for us not just their work, but their attitude - that I immediately went out and bought a couple of their novels. I was hooked.

This isn’t a unique approach. Borders and Barnes & Noble do it all the time. But here you had a small town operator, Just Books, playing the same game and winning.

Winning. Not whining.

Compare that experience to my decision the other day to visit another local bookstore. It was 5:15 pm on a Saturday - and it was closed. And wouldn’t open up again until Monday morning. So I went to Borders.

I've heard employees at this bookstore belittle Barnes & Noble and Borders for their coffee bars and less-than-pure approach to book retailing, and I've heard them whine about the impact that Amazon has had on the book business. But the fact that they're losing has nothing to do with the competition, and everything to do with not understanding why, in 2004, you can't shut your doors at 5 pm on a Saturday afternoon. Because that sale, and others like it, can never be recovered.

My favorite mantra for retailers of all stripes is as follows:

You have to be where the customer wants you, when the customer wants you, how the customer wants you, with the product the customer wants at a reasonable cost that the customer deems appropriate.

Do that, and you have a shot at winning. Do otherwise, and you can whine to your heart's content. Because nobody will hear you.

Reprinted with permission Chain Store Age (5/2004). Copyright Lebhar-Friedman Inc., 425 Park Ave., NY, NY 10022.

For further information about Chain Store Age, go to:

http://www.chainstoreage.com
KC's View:
It is worth noting, as an addendum to this column, that Apple Computer continues to aggressively work on getting people to sample its products. Having reversed the company’s fortunes with the magical iPod, it now has come up with a smaller, less expensive version called the iPod Shuffle that was just announced yesterday and that critics already are raving about. And, hoping to translate usage of the iPod into the sampling of its computers and operating system, Apple also has created a Mac mini hard drive that can be hooked into an existing keyboard and monitor, allowing people to convert to Apple for as little as $500. Smart thinking, smart marketing. And no whining.