Brand Noise

Outraged eBay sellers plot strike week

Ever since eBay (EBAY, Fortune 500) announced changes to its feedback rules and fee structure last week, sellers have been irate, exploding onto message boards and blogs with discussions about how the new policies will affect their businesses. But when the idea of a strike was floated, some sellers and buyers decided to get more organized about expressing their displeasure.

A discussion thread on eBay's own forums with the title "Sign the pledge_no sales Feb 18-25!" has received 4,000 posts in nine days, many expressing members' intentions to join the boycott. The strike is scheduled to overlap eBay's planned Feb. 20 launch date for its new policies, which include fee hikes, a 21-day hold on some funds sent through its PayPal payment service, and disallowing sellers from leaving negative feedback for their buyers.

Read more.

What's more interesting is the people that have already bailed on Ebay, moving to sites like Etsy.com, Bidtopia.com, Amazon.com, eCrater.com. There are plenty more interesting, targeted ways to sell to niches now. The consumer has choices. How will Ebay respond to the exodus?

Fortunoff Selling to L&T Owners

Fortunoff has agreed to sell its more than 80 year old business to an affiliate of NRDC Equity Partners, the owner of the Lord & Taylor department store chain.

NRDC Equity Partners plans on investing $100 million into the Fortunoff business, with investments being made in both existing and additional stores.

For the last decade or so, Fortunoff has existed as the place your mother took you to set up your bridal registry or buy an engagement ring. It was a safe bet, yet sans innovation.

The safe-bet factor levied the brand as the generation in charge moved through the Baby Boomers, but for it to work across Gen X and Gen Y is going to call for transformation.

Timeless brands quickly become timeworn without evolution.

Kid Robot, Secret to “Yo Gabba Gabba!” Success?

“Yo Gabba Gabba!” began appearing on Nickelodeon in August, and with remarkable speed it has acquired fans who are preschoolers and fans who are old enough to be their parents...Charles Rivkin, the president and chief executive of Wildbrain, which produces the show, says, “I challenge you to find another preschool show that four months after going on the air is actually selling adult apparel at Barneys.”

While plenty of shows for children have also appealed to adults — “Pee-wee’s Playhouse,” “H. R. Pufnstuf,” even “Sesame Street” — “Yo Gabba Gabba!” updates this idea for a generation that, it has been argued, is ambivalent about letting go of its own youth.

The real deal came when the original creators hooked up with Wildbrain. Back in 2006, Wildbrain acquired a majority interest in Kidrobot, which makes and sells high-end “designer toys” and apparel that appeal to fashionable young adults (who may or may not be parents). Thus “Gabba”-related products arrived in exclusive retail settings much faster than usual, demonstrating consumer demand to other merchandise partners.

You couldn’t ask for more perfect serendipity in partners, which goes to prove that authenticity starts at the drawing board. Had “Yo Gabba Gabba!” been conceived under other premises, it wouldn’t have been strong enough to bring into the Kid Robot world. On the other hand, if “Yo Gabba Gabba!” merchandise went straight to big box retailers you would’ve had a watered down product. The Kid Robot connection offers the brand longevity, with more staying power than it would have had on its own.

(Image: T-shirt recrafted into dress by JinJur.)
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Rethinking Starbucks

Sharing some company press in today's AdAge:

Starbucks Coffee Co. has returned its No. 1 barista, founder Howard Schultz, to his former role of chief executive to perk up its sales and stock price. To differentiate its brand, Mr. Schultz said Starbucks would focus on its store "experience," one which he criticized in a memo to Jim Donald last February.

""It's time for them to evolve before the brand erodes any further," she said. Starbucks' problem is oversaturation, she said, but the company must be careful about which stores it closes, not just shuttering underperforming stores in poor neighborhoods.

Ms. Tupot, who consults for Starbucks' competitors, also said Starbucks might consider adding more local character to individual stores so that a traveler to another city might enjoy not just a predictable cup of coffee but be able to "capture the locality." While Starbucks has been careful to point out that it is not a fast-food restaurant, Ms. Tupot believes it could do well selling certain types of foods beyond cake and other sweets. For example, she said East Coast chain Le Pain Quotidien serve baguettes and spreads along with coffee and allows customers to sit at a long table and linger.

She noted one promising Starbucks initiative is its use of text-messaging, whereby customers can order drinks from a cellphone and pick them when they arrive at the store, bypassing those standing in line.

Woman Attempts to Reunite Long-Lost Pairs (of gloves)

Jennifer Gooch, who is pursuing her master of fine arts degree at Carnegie Mellon University, started onecoldhand.com in an effort to reunite dropped gloves with their mates -- and in the process spread some goodwill.

One of her first ones was a moist, lambskin glove that someone had propped up on a ledge on campus. In its place, she left a small rectangular sticker. A drawing of a black glove is scrawled on it and says, "Missing a glove? onecoldhand.com."

Gooch, originally from Dallas, photographs each glove and puts the picture and information on her Web site, where people can report found gloves and request stickers.

She's working with two women in New York to start a similar effort there, and is talking with local businesses about creating glove dropboxes where people can leave their fabric finds.

At Macy's NYC, Only Santa is Real

We made the annual trek to Macy's Herald Square to see Santa with much insistence from my 60-something mother. It's the only place where Macy's is like it used to be, claims she who has had a Macy's credit card since 1956. Or is it? She paraded herself proudly at each sales counter waving the 20% Macy's discount card recently mailed to her--Only to be dismayed that the card was not accepted at any of the favored spots that make Macy's feel like the "old days." It's been policy for as long as I can remember that certain discounts are not extended to these leased departments. Yet the prolification of today's leased departments have deconstructed Macy's Herald Square into essentially a mall. So the Macy's my mom thinks is a nod to yesteryear is simply on lease. That makes it impossible for the essence of what was Macy's to ever extend beyond the...(er)...flagship.

But at least we know that the Santa at Macy's is real. According to my five-year-old, he never has to ask her name and he knows that she's grown a lot. That gives Macy's about another five years to grab hold of their brand before this kid hits tweenhood and steps up her retail expectations. As for now, she thinks Macy's is magical--that one brief visit each year holds her imagination for 365 days.   

Supermarkets Cycle into New Era

Saw this article in WSJ and made it click for me as to how retail is truly transitioning from a Brand X/Y culture shaped in the fifties and sixties to a much more complex era shaped by technology and multiplying polyglot brands.  Wal-Mart sits as the poster child for this post-industrial growth and expansion in the US ecomomy. The trouble Wal-Mart is having now has much to do with an overall shift in where people want to live, how they want to live and what they value.  A shift from post-WW2 suburban ideals of more stuff = trade up, to a new urban driven culture where differentiation is harder to achieve  and fosters a more nuanced view of what people value in general.  A move to more micro-retailing methods and micro-merchandising.  Smaller packages - bigger impact.  An increased knowledge level of even the most average laggards forces a mandate for more innovation than ever before.   Read the article (WSJ)

(excerpt) In some ways, Wal-Mart's loss of clout is a reflection of a more fragmented world. Retailing is a mirror to how we live and work. Big-box stores thrived by selling highly recognizable national brands, which themselves were fed by two phenomena: the growth of mass media and freeways, which encouraged large stores in remote areas. Stores and brands together achieved scale efficiencies that allowed them to overwhelm local chain stores and regional brands.

But the Internet is transforming the retail definition of scale. The once-stunning compilation of 142,000 items found in a Wal-Mart supercenter doesn't seem so vast alongside the millions of products available on the Internet. At the same time, the cost of creating and sustaining a national brand is rising because of media fragmentation. Niche brands, created by Internet word of mouth, are winning shelf space and sapping profits required to fund big brands' advertising. Manufacturers such as Apple Inc. and Phillips-Van Heusen Corp., lacking the retail distribution or presentation they crave, are opening their own stores. One result is that retail giants hold less sway over their customers -- and over their suppliers.

Tesco Shopper Alogorithms

Dunnhumby, a data-analysis firm, uses algorithms to crunch data on customer behaviour for a number of clients. Its best-known customer (and majority-owner) is Tesco, a British supermarket with a Clubcard loyalty-card scheme that generates a mind-numbing flow of data on the purchases of 13m members across 55,000 product lines. To make sense of it all, Dunnhumby's analysts cooked up an algorithm called the rolling ball.

It works by assigning attributes to each of the products on Tesco's shelves. These range from easy-to-cook to value-for-money, from adventurous to fresh. In order to give ratings for every dimension of a product, the rolling-ball algorithm starts at the extremes: ostrich burgers, say, would count as very adventurous. The algorithm then trawls through Tesco's purchasing data to see what other products (staples such as milk and bread aside) tend to wind up in the same shopping baskets as ostrich burgers do. Products that are strongly associated will score more highly on the adventurousness scale. As the associations between products become progressively weaker on one dimension, they start to get stronger on another. The ball has rolled from one attribute to another. With every product categorised and graded across every attribute, Dunnhumby is able to segment and cluster Tesco's customers based on what they buy. Read more (The Economist)

McCoffee Perfecting Overseas

Although McDonald's has been testing a handful of the gourmet coffee and snack bars in the U.S. since 2001, the real market is overseas, in 33 countries so far. McCafés are all over Australia, ramping up fast in Germany and just starting in Japan, where McDonald's has 3,300 restaurants. McDonald's opened the first 15 McCafés around Tokyo in late August, with menu items including green tea and red-bean shaved ice.

In Germany, McCafé is the market leader in coffee shops. The biggest competitor is Starbucks, which opened in Berlin in 2002 and now has 98 outlets, mostly in big cities. German coffee giant Tchibo has about 500 shops, but customers have to drink their coffee standing up.  Read more (AdAge)

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Scent as a Differentiator

At Las Vegas CityCenter, to get people to buy what is essentially a very costly lifestyle accessory — or a third home, they wanted to appeal not just to the minds of prospective buyers but also to “their emotions, psyche, heart and soul.”  One key to creating it, he thought, would be to employ the power of scent.

In real estate, a basic form of scent marketing has been around for decades; consider the seller’s trick of placing a freshly baked apple pie or cookies in the kitchen, which makes a house feel more like a home. The problem is one of scale he notes. ScentAir’s technology, originally developed for military simulators and theme park rides, is now used by Toll Brothers, D. R. Horton and other major builders to sell thousands of new homes nationwide.

Companies are also intrigued by the potential of using smell to unleash memories — positive, deeply held ones that could then be associated with the products offered — and also to strengthen brand memory. “The emotional power of smell-triggered memory has an intensity unequaled by sight- and sound-triggered ones,” wrote Rachel Herz, a Brown University neuroscientist, in a paper summing up more than a decade of her research.  Read more (NY Times Magazine)