On Wednesday of last week, Ann Zimmerman of The Wall Street Journalreported on my former employer, Toys “R” Us, which is planning to open up 600 temporary “pop-up stores” in anticipation of the holiday shopping season. The WSJ describes it as a super-sized bet while the company maintains it is a proven strategy. Like most prospective retail decisions in this uncertain economic period, it is likely a mixture of both.
Ann certainly has some legitimate weight behind her assertions:
The space in which the pop-up stores will reside is distressed for a reason. Who can guarantee that a watered-down version of Toys “R” Us will be able to overcome inherent issues such as poor foot traffic or a bad location?
Toys “R” Us has historically experienced issues with inventory; the majority of it never turns and Toys "R" Us often sells out of its best sellers before the season comes to a close.
While trends show improvement, there is no guarantee of economic rebound for the holiday seasons. This could spell disaster if Toys “R” Us moves forward with 600 new shops.
It's a shame to get old! My oldest child recently announced that he and his wife are having a child themselves. On one hand, I am thrilled at the prospects of having a smiling infant in the family - that I can hand off for unpleasant tasks. On the other hand, I am in complete, 100% denial about the word that will define my relationship with this child - the "G" word - shhhh, don't say it!
This made me reminisce about work. I remember my years in marketing at Sequent Computer Systems. The sales organization sold products based on "feeds and speeds" that became possible from "symmetric multi-processing." It was exciting stuff. We lived on the cutting edge of technology. Customers bought "products."
My next move placed me in the outsourcing industry. Rather than buying products, customers looked for solutions - usually a functional combination of hardware and software to solve a technical problem. Acronyms such as ERP and CRM were common, and the services industry exploded. Customers bought "solutions."
Now I am at Forrester and witnessing another fundamental change in the market. The financial pressures of the recent (and continuing?) recession changed customers. They now align business investments with technology costs. Customers want "outcomes."
The problem is that tech vendors are going to market the same way that we did 20+ years ago. In today's market, vendors must understand the customer - not in the abstract - but understand current problems and desired outcomes. Adapting your products and messaging to a customer point of view is called "portfolio management." Forrester's sales enablement team would love to hear about your experiences, perspectives, or insights.
As you probably know by now, I really enjoy engaging with all of you through social media like this blog or via Twitter. Of course, I like doing research and writing reports, but that's very much an academic exercise. The blog and Twitter are about direct communication and instant feedback (and, in a way, instant gratification). However, these are still all virtual contacts. So, I thought I would share with you where you can find me, and my team, in the next couple of months so that you can meet us in person.
I will be speaking at Forrester’s upcoming Consumer Forum in Chicago, October 28-29, and our Marketing & Strategy Forum EMEA in London, November 18-19. The theme of Forrester’s Consumer Forum 2010 is “Unleash Your Organization To Serve Empowered Customers.” Lots of the content will be related to the new book Empowered, by Forrester analysts Josh Bernoff and Ted Schadler.
The market research track will show why the ability to understand customers’ needs and wants from several data sources is the key to supporting the organization with actionable insights. It will include the following presentations:
“If The Company Only Knew What The Company Knows: How The Introduction Of A Knowledge Center Can Empower Market Research Professionals,” Reineke Reitsma.
“Trends And Best Practices In Social Market Research,” Tamara Barber.
“Understand Influential Young Online Consumers: A Global Perspective,” Jacqueline Anderson.
I am attending Nokia World in London. For those of you not familiar with this event, that’s usually the conference where Nokia shares its vision and strategy, announces new products and services, and demonstrates its latest innovation. This is also an interesting opportunity to hear thought leaders share their vision of the mobile industry (this year, Sir Tim Berners-Lee). See the agenda here.
The 2010 edition is already unique in Nokia’s history due to the recent appointment of Stephen Elop as the new CEO and yesterday’s resignation of Anssi Vanjoki, currently EVP of Nokia's Mobile Solutions unit. Needless to say there is lots of speculation about Nokia’s future. Let me wrap up some thoughts:
It’s precisely all about organizational and cultural issues. No one should be surprised to see other departures as well as the arrival of new executives close to the newly appointed CEO. Nokia’s real challenge is to make sure these changes are implemented quickly enough -- without totally disrupting existing processes -- to keep pace with innovation. The simple fact that Nokia appointed a non-Finnish CEO, coming from the US and from Microsoft and the software industry, is another acknowledgment that Silicon Valley has become the new mobile innovation hub. Nokia’s cultural heritage is precisely to constantly reinvent itself. Tectonic shifts are shaking up the traditional mobile ecosystem, and Nokia needs to be much more agile to compete with the likes of Google and Apple.
The iPad has been a huge hit with consumers: Only a couple of months after the launch, Forrester’s Technographics data shows that 1.3%, or 2.5 million, US online consumers report that they already own an Apple iPad, and an additional 3.8% (7.4 million) say they intend to buy one. The success of the Apple iPad has created a halo around tablets in general: About 14%, or 27 million, US online consumers say they intend to buy some kind of tablet in the next 12 months — more than any other type of device we’ve asked about.
A recent Forrester report “US Tablet Buyers Are Multi-PC Consumers” shows that it’s not all good news for PC manufacturers. Because, although consumers are getting excited about tablets in general, they're confused about what they actually are. This confusion probably means that not everybody that shows an interest will actually buy a tablet, but we do think it shows that there's interest in the category that goes beyond the iPad. PC manufacturers like Dell, HP, Samsung, Sony, and Toshiba need to offer consumers a bit of guidance on what a tablet is, what it can do, and how it complements the extensive range of devices they already own.
One of the things that continues to surprise me about many banks’ multi-channel strategies is how little most banks have integrated their ATMs into those strategies. Cash machines are by far the most commonly used banking channel. According to Forrester’s Consumer Technographics data, 74% of adults in Western Europe use a cash machine at least once a month, far more than use either branches or online banking that often.
Despite the introduction of Windows-based operating systems and colour screens, most banks aren’t doing much to engage customers on this most-frequent touchpoint. Most do little more than promote the product of the month to all comers. Only a few leaders, like Singapore’s OCBC Bank and Spain’s La Caixa, have integrated ATMs into their CRM systems, which lets them do clever things like remembering customer’s normal withdrawal amount, wishing customers a happy birthday and making products offer that are relevant to that particular customer.
“Two roads diverged in a wood, and I – I took the one less traveled by, And that has made all the difference.”
- Robert Frost
In today’s dramatically changing world, many of you are also at a metaphorical fork in the road.
The path most traveled represents squeezing that last ounce of productivity from the tried-and-true practices that got you to where you are today.
The other path is being set by trailblazers who recognize that the economy is resetting itself and new go-to-market models are emerging.
Simply put, it’s a race to see who can develop a selling system that allows client-facing people to add more value to clients, at every interaction. These value-exchange patterns are different based on your customer types, the problems you help address, and the role your organization plays in solving them.
I am excited to be telling you about our first sales enablement conference, which will be held in downtown San Francisco February 14th and 15th. Over the summer, our team has been at work putting together a truly exciting and innovative agenda for our forum. Here are a few of the great topics we are working on:
What do buying executives actually think of how they are engaged by sellers? There’s a lot of talk about getting sales and marketing to sing off the same page, but what is the song? Any kind of alignment should start with buyers, and we are going to present a mountain of buyer insights that in many ways are jaw-dropping.
Social media has given consumers a voice, and brands are extremely concerned about how detrimental a bad review can be once it is posted online. But while this has taken the spotlight and has become an important, top-of-mind issue on marketing teams, it’s vital not to ignore the simple word-of-mouth review. Our Technographics® research shows that almost half of all consumers have complained directly to a family member or friend versus the mere 3% who have posted on a web site like Yelp/Trip advisor, or the 1% who have tweeted their complaints.
Listening software has made it easy for organizations to understand the latitude of negative feelings about their companies and brands and has given them some tools to directly address a complaint online by responding to an individual. It is nearly impossible to harness the conversations going on offline among groups of friends, although the numbers show that the effects of these talks are more widespread than the ones online — especially when you take into account that research shows that consumers trust friends and family most when making decisions.
Working in Europe, I'm constantly hearing about social media programs designed for one country accidentally reaching users in other countries -- especially when they're done in English. Toyota's excellent social media-focused iQ car launch in the UK attracted attention from the US, where the car isn't available. Yesterday a client told me that their Australian marketing team launched a Facebook page that they thought was just for their market -- but when they looked at the analytics, they found that only about 5% of the page's fans were Australian, with the rest coming from other big English-speaking markets.
As I see it, there are two big challenges when global companies use social media:
How do you best leverage social media resources from one country (be they staff, technologies, partnerships, or content) across other countries to improve your efficiency and effectiveness?
How do you keep social media messages that are appropriate for just one market (because product availability, or specifications, or pricing, or marketing message can vary from place to place) from "bleeding out" to reach users in other markets?
I'm a big fan of the digital home, even if the phrase itself has slipped from popular use lately. I cannot wait for it to happen to me -- I'll have connected displays (does the word TV even apply anymore?) throughout the house, including the ones in my pocket, in my lap, or otherwise within reach at all times. Those displays will all speak IP, the language of the Internet, and they'll all speak to each other as well, allowing me to control one display -- say, my TV -- with another one -- my Droid X, for example. There's so much product innovation yet to come in the digital home that I love my job.
I'm not the only one who sees it, of course. If you follow the excited announcements from TV makers and electronics retailers like Best Buy, the next TV we all buy will be a connected TV (defined as a TV set with its own Internet connection whether wired or wireless and some kind of software platform), a critical first step toward that future digital home nirvana.
Connected TVs are going to be a big deal; to understand why, read my latest report which includes US survey results about connected TVs along with a forecast for connected TV penetration through the middle of the decade. It just went live to Forrester clients last week. In the report, we show that thanks to the enthusiasm on the supply side, connected TVs are going to sell like proverbial hotcakes. By 2015, we forecast that more than 43 million US homes will have at least one. That's a remarkable number, especially considering that we entered 2010 with fewer than 2 million connected TV homes in the US.