Author: Al McClain

The Perils of Competing with Discounters

What happens when a retailer decides to target more affluent customers, because sales are down and they’re worried about Wal-Mart and other discounters?? If you’re Zales jewelers, nothing good. As reported this week in the Wall Street Journal, Zales decided to go after more upscale consumers in early 2005, following a tough Christmas season, and while feeling the heat from discounters, along with online retailers and TV shopping networks. When you are a retailer losing share to discounters (and who isn’t or hasn’t these days), is it best to make radical changes as Zales did or experiment with strategies and tactics that can help you find new customers and markets?

Consumers Aren’t Drinking Like They Used to…Carbonated Beverages, That Is

As everyone in the retailing industry must know by now, sales of carbonated beverages are off. According to recent Morgan Stanley research by analyst Bill Pecoriello as reported in Ad Age and on CNN/Money, soda volume is expected to decline 1.5 percent annually for the foreseeable future. How can mainstream retailers sort out consumption trends that are having such a huge impact on this category?

CEO’s are Overpaid – Get Over It

A recent study by the Economic Policy Institute showed, that in 2005, the average CEO in the U.S. earned 262 times the pay of the average worker, and made more in one workday than the average worker earned in a whole year. In 1965, the average U.S. CEO earned 24x the average worker; by 1989 the figure was 71x; and by 2000 the figure reached 300x. And, we’re outraged. Outraged! But, not really. What companies (retailers or suppliers) would you cite as having great top management that is compensated well because they deserve it?

Retailers – Are They Leveraging the Strongest Brands?

A just-released Harris Interactive study ranks Reynolds Wrap as the strongest brand of over 1,000 measured. Interestingly, ad spending did not correlate to making the top ten list as Reynolds Wrap received only $7.5 million in media support last year. Is there an opportunity for retailers to improve merchandising and promotion of little advertised brands that have high brand equity?

The Implications of Exporting a Drive-Thru Culture

By now, you’ve likely read that McDonald’s is partnering with a state-owned Chinese petroleum company, Sinopec, to open fast food restaurants at some of 30,000 gas stations in China. The announced plan is to open 100+ outlets with drive-thru’s in China per year for as long as the market will bear it. How much cultural indoctrination will it take to make U.S. retailers like McDonald’s a full-blown success in China?

Making a Cold Brand Hot

It’s 90 degrees with high humidity and summer is at least unofficially here. So, what’s the next best thing to ice cream? How about a story about revitalizing a 60-year-old ice cream brand? Is it better for long-established, successful retailers to do total redesigns, or tinker with their look continuously as they go along?

Shoppers Aren’t the Same Everywhere

While it’s no surprise that some people love to shop and some people hate to shop, it may surprise you to learn that U.S. consumers do not enjoy “recreational” shopping as much as those in some parts of the world, according to an online ACNielsen study. In fact, while 74 percent of the world’s consumers admit to shopping as entertainment, those shoppers most likely to do so are largely in the Asia-Pacific region. Why do you think shopping apparently is a more enjoyable experience in the Asia-Pacific area and Latin America than it is in the U.S. and Europe?

Learning New Tricks from the Local Car Wash

If you’ve ever heard retailers lament, “the big box guys are killing us,” you know there is room for improvement, and car washes may have a few ideas. A Wall Street Journal article reports on some of the added services car washes are introducing to better differentiate themselves at a time when big box retailers are at least testing car washes, and many supermarkets and c-stores offer them as well. Can other retailers learn anything from the efforts of full service car washes to compete with bigger retailers offering self service or limited service washes?

What Happens When There Are Fewer Big Retailers?

Retailer consolidation is nothing new; it’s been happening for years. What is new is hearing from consumer packaged goods manufacturers that “38 percent of our business is with Wal-Mart” or “over 80 percent of our business is with our top ten customers.”A recently released A.T. Kearney/GMA study of CPG execs found that finding growth is their #1 issue, and that consolidation and the power of retailers tied for third. What’s your take on the ultimate end-game of retailer consolidation?