Looks not tips the key to a good table in Paris

For the handful of NAMs that still treat buyer-lunches as a trade investment, latest news from Paris indicate a need for new facial KPIs in making a non-refuse lunch-offer to key buyers...

According to satirical weekly Le Canard Enchaine, it's the quality of diners' looks -- not the size of their tips -- that make the difference at Le Georges, the upmarket restaurant on the top floor of the Pompidou Centre, and the Cafe Marly, which occupies a prime spot within the Louvre museum.

Two waitresses who have recently quit Le Georges told the weekly that they were ordered to sort customers into the good looking and the, ahem, less good looking. Those who made the cut were seated in prominent positions at the front of the restaurant while those who got the thumbs down were ushered off to the back, preferably out of sight.

At the Cafe Marly, the pavement terrace was reportedly declared an ugly-free zone with anyone seeking to reserve by phone systematically told, "We'll do our best but we can't guarantee it," pending a looks appraisal on arrival.

Mobile KamTip:
To bypass the screening process, why not attach a badly lit pic of George Clooney/Sandra Bullock to your mobile request for a down-to-earth table in a spacious corner?

Have a real weekend in unreal times, from the NamNews Team!

See it, snap it, buy it: the new way to shop online...

"We shop with our eyes, so why not search with a photo?" asks Jenny Griffiths, founder and CEO of Snap Fashion, the fashion search engine that uses pictures instead of words.

Her idea was born out of her frustration at trying and failing to find affordable equivalents to the designer clothes she found in fashion magazines. When regular search engines failed to quench her affordable fashion thirst - there are after all only so many ways you can describe an item of clothing to Google - the 26-year-old realised that her quest would be markedly easier if she could just submit a photo of the item she was searching for.

Snap Fashion obviously meets a shopper-need, but savvy NAMs will appreciate that there is a much bigger idea lurking here…

In other words, this is all about pattern and shape recognition. So anytime you see an ornament, poster, piece of furniture, hairstyle, gadget, or even a foreign-language version pack of a ‘well-known’ brand and ‘you don’t like to ask’, a simple pic will help you to find an affordable source..

In fact, all it would take is for a company called Amazon to adapt the software to their site to flesh out the real potential….

"clicks to bricks" - Online retailers move into the High Street

Rapha Cycle Club on Brewer Street, near Piccadilly Circus

"Retail observers have been significantly overestimating our use of online and digital technology for shopping - we like shopping in stores," says Nicole Flasch-Mihalko of LIM College, which carried out a survey with the National Retail Federation in the US.

A number of online retailers have taken the survey findings to heart....
For instance, Rapha, which started as an online business in 2004 selling high-performance cyclewear, opened its first store or Cycle Club in San Francisco in 2011. Now it also has branches in London, Osaka, New York and Sydney.

Rapha says its stores have been a big hit with customers, offering a showcase for its clothing but also acting as a place to absorb cycle culture - to drink coffee, join in organised cycle rides and watch major races on big screens.

For High Street landlords with vacant space to rent as well as online start-ups this trend is good news, says Ross Bailey, founder and chief executive of Appear Here. His firm brings together shop landlords and mainly e-commerce entrepreneurs, with the aim of making renting a pop-up or permanent physical shop easier and more flexible.

The key idea is online retailers - Ronliners -, with no baggage or no preconceived notion of what works in classic retailing, but especially with little to fear from the emergence of online, can focus on the shopper's experiential interaction with the product, secure in the knowledge that they have already secured the ongoing deal...

...while their traditional competitors focus on restricting access to the instore wifi... 

Perks of an MP include free snuff...

MPs are being supplied with snuff at taxpayers’ expense, according to an official guide to life in Parliament.

“No, no, Minister, just one pinch per nostril”

The Customer's P&L - A road-map for your business?

Despite the fact that using a customer's latest P&L for guidance can be a little like driving via the rear-view mirror, five years after the global financial crisis, the effects are now truly evident in most retailer's Annual Accounts.

For instance, where retailers were producing ROCEs of 15+%, Net Margins of 5+% and Stockturns of 20 times per annum, latest results are showing performances of half these levels, or worse...

With one exception: Walmart, the retail elephant in the room.

This global player, on a low-price platform, continues to generate an ROCE of 19.6%, a Net Margin of 5.5% and a Stockturn of 10.7 times/annum, thereby demonstrating that it is still possible to achieve these results in retail... 

(incidentally, for those with an eye for detail, Walmart's 'low' stockturn reflects their mix of categories and the geographical scale of the US. When and if Walmart ever comes under ROCE pressure, they can simply insist on smaller, more frequent deliveries from 'eager-to-jump' suppliers...)

In turn, Walmart's performance puts pressure on other retailer's to revert at least to their pre-crisis performance levels in order to support their share prices.

...and as you know, a low share price encourages takeover bids, even in well-ordered, 'growing' economies...

In other words, retailers need suppliers, more than ever before.

In turn, NAMs need to be able to cost out each element of the remuneration package - margin, terms, trade-investment and deductions - and demonstrate each element's impact on the retailer's P&L and Balance Sheet, using the supplier's own P&L to measure progress...

Hopefully a little more engaging than making endless excuses ref inadequate trade investment funds...? 

(For a focused discussion on how this can work in your case, pls give me a call +44 (0)7977 273409)

UK shoppers replace loyalty cards with phones

A new survey from CloudZync via a poll of 2,000 consumers shows that while the average leather wallet now contains four loyalty cards, people have access to six schemes on their handsets.

Supermarkets are falling behind in the digital race - 92% of respondents have a physical card for Tesco, Sainsbury's or one of their rivals yet only 36% have a mobile scheme.

Furthermore, loyalty card users have on average £83 worth of redeemable points across their schemes at any point in time, and UK shoppers have cashed in on over £4 billion worth of points over the past year.

However, around £150 million in points remain unclaimed. Explaining why, 27% say that it takes too long to start earning benefits, 18% say they don't carry their cards in their wallets, and 14% don't remember to add on their points even when paying in-store.

In other words, traditional retailers are operating in ‘inertia-land’, on the assumption that low redemption rates will continue…

However, as with the infamous Hoover air-miles fiasco, if consumers are presented with more effective ways of managing their loyalty point redemption, current levels of inertia could disappear and be replaced by soaring redemption-levels, well beyond retailer expectations…

An app-nightmare in the making? 

Cocktails with aspirations - something special for the weekend?

NB. Large detailed version here

Circular outsourcing?

Source: Kevin Kelly http://kk.org/kk/ Scott Adams was ahead by a whole decade. From Dilbert, August 3, 2003

Sainsbury's taking Tesco to court over Price Promise – a definition of like-with-like?

Sainsbury’s move to obtain a judicial review is good in that it is an attempt to distinguish a legal ‘letter-and-spirit’ issue from a true like-with-like comparison of what a consumer gets for the money.

In other words, when Tesco and the watchdog's independent reviewer Sir Hayden Philips focus on function of the product, bottled water in terms of say quenching thirst, they are adhering to the letter of the law ref like-with-like comparability.

In doing so, they are not taking into account the ‘spirit-of-the law’ issues such as provenance or ethics.

However, the consumer places some value on ‘source’ and is prepared to factor some of this value into the offering when deciding that a price is acceptable, compared with available alternatives.

Consumers live by what they take to be the spirit of the law and feelings of being misled arise when a ‘letter-of-the-law’ claim is found to be wanting in practice, as any true marketer will appreciate.

The problem for the judiciary will be in trying to establish a universal value for provenance or ethics….

However, in the meantime, the media coverage will hopefully cause consumers - and retailers - to think a little more deeply about making a like-with-like comparison that goes a little closer to the spirit rather than simply the letter of the law in deciding that a given Product-Price-Presentation-Place combination is better value for money…

Baked Bean Heist via lorry-based picking?

Given the brand’s pulling power, combined with consumer click & collect trends, it should be no surprise that thieves decided to dispense with the click and help themselves to 1.5 pallets of Heinz baked beans with sausages ‘off the back of a lorry’ while the driver slept upfront in a layby on the A441 at Cookhill, near Redditch in Worcestershire.

By way of endorsement of the cab’s two-way soundproof qualities, the thieves were able to work undisturbed as they cut a large hole in the side of the white Scania vehicle and helped themselves to 6,400 tins.

"Police are appealing for information, especially about anyone trying to sell large quantities of Heinz baked beans in suspicious circumstances," a force spokesman said.

Hopefully the police have been briefed that it is quite normal for NAMs to spend their days trying to sell large quantities of product, but nonetheless it might be wise to cut down on over-generous multibuys while this one blows over… 

P.S. For those who want to double-check, the product code is 71517000 with an expiry date of 31 March 2015.

Second-guessing the Guesstimate: Getting the Unit-price Wrong at Tesco?

Following years persuading shoppers to attempt to compare like-with-like via the price-per-kilo addition to the shelf price, it would appear that a savvy shopper may also need to check the basic arithmetic of the multiplier...

According to an article in the Guardian, following the summer's 'strawberry court case', Tesco is once again allegedly getting its price-per-kilo labels on soft fruit wrong. Tesco's website apparently says its "Everyday Value" strawberries are £5.40 per kilo, but they are not. In reality they are a third more expensive at £7.14 per kilo.

The punnets are priced at £1.62 for 227g, with the label helpfully adding that the quantity of strawberries is equal to £5.40 per kilo. Now even those whose maths is pretty rusty can do a rough calculation – you get just over four 227g punnets in a kilo, so that is four times £1.62, which is rather more than £5.40
(i.e. £1.62/2.27 x 10 = £7.136).

The article lists several other instances, and quotes Tesco’s apparent replies to queries:
- “…as prices change all the time this figure is just meant to be a 'guide'."
- “…We'd like to reassure our online customers that no one has paid more for their berries than the listed price."

As often happens with corporate answers to consumer queries, answering the wrong question can be more damaging than correctly dealing with a genuine concern.

As most savvy customers increasingly familiar with price-comparison web-facilities will realise, a ‘per kilo’ conversion is a straight-forward arithmetical calculation that can presumably be locked to the SKU price in even the most basic computer systems i.e. there should be little scope for ‘human error’ once the new shelf-price is established…

Secondly, attempting to reassure the shopper that they have been charged the correct shelf-price is a reply more in keeping with the letter rather than the spirit of the law – a statement which is legally correct but misses the point that the shopper can be making a purchasing decision based upon the ‘per kilo’ comparison with other SKUs...

It might also be claimed that the ‘per kilo’ represents only pennies and should make little difference, except to a savvy consumer that has undergone years of persuasion that every little helps…

A little self-amuse in a long-haul loo...

On your next trip overseas, why not repair to the aircraft rest-room and release your inner artist....?

While on a long-haul flight, when most people would sleep, read a book or chew on complimentary snacks, Nina Katchadourian spends her time locked in the airplane’s lavatory taking 'selfies' in the style of 15th century Flemish paintings...

.  

Details plus ten additional examples here

Thanks to Emma Carlin and Anne Johnstone for link and application

The Amazon approach to backhauling: from within P&G warehouses..

Each day, P&G loads products onto pallets and passes them over to Amazon inside a small, fenced-off area of a joint-warehouse stocked with Pampers, and Bounty paper towels. Amazon employees then package, label and ship the items directly to the people who ordered them.

The e-commerce giant is quietly setting up shop inside the warehouses of a number of important suppliers as it works to open up the next big frontier for Internet sales: everyday products like toilet paper, diapers and shampoo. Amazon is going out to its suppliers with a program it calls Vendor Flex. By piggybacking on their warehouses and distribution networks, Amazon is able to reduce its own costs of moving and storing goods, better compete on price with Walmart and Costco, and cut the time it takes to get items to doorsteps.

Household staples have traditionally been considered too bulky or cheap to justify the cost of shipping. Americans currently buy just 2% of such goods online, retail analysts estimate. Yet even that sliver of business was worth $16 billion in 2012, according to Nielsen, who believe online sales will grow by 25% a year to $32 billion in 2015.

Having cracked the problem of bulky product shipments to consumers, why should Amazon and P&G not extend the idea to other parts of the portfolio?

With pay-offs for both parties (Amazon saving costs of bulky-storage, and P&G eliminating the cost of onward distribution) the idea has already spread to 7 P&G distribution centres worldwide…

...and with no mention of the resulting dilution of traditional multiples buying power, watch this space….

Selling ideas to the unresponsive buyer – challenging the status quo

A buyer who is ‘satisfied’ with your competitor’s brand, the status quo, is not in the market for change.

In other words, it is not possible to sell to a satisfied buyer.

Disturbing the status quo is crucial in making the buyer receptive to new ideas i.e. if the buyer is happy with the current situation, then there is no reason to change, and even less need to consider your proposition.  The first step means de-stabilising current levels of buyer complacency by appealing to their curiosity regarding how others are dealing more effectively with the same issue, or shocking them by exposing their personal vulnerability to changes in the market.

For instance, a buyer that buys at the same price and sells at prices equal to the competition yet nets 3% vs. the rival’s 5%, is obviously open to explanations…. Likewise, a highly geared retailer may not appreciate the danger of a 2% increase in cost of borrowing…

Successfully challenging the status quo means being able to capitalise on the key advantage of the NAM role – breadth of vision arising from experience of the category across the entire marketplace, an insight into all possible ways of making the category available to the consumer – combined with the indepth, but narrow view of the buyer operating within their own store environment.

This potential synergy can be leveraged when the buyer views the NAM as a pan-market expert, a source of insight as to how the other guys are doing. Nothing confidential, simply reassurance that tricks are not being missed…

However, successfully challenging the buyer’s perception of the status quo is not so much about opening the wound, but, having done so, being able to show a plausible link between your proposed solution and the ‘new’ problem.

Otherwise the buyer has simply been made available and receptive to your competitor’s next offer. 

A shelf nearby is watching you....

According to The Washington Post, Mondelez, says it's planning to debut a grocery shelf in 2015 that comes equipped with sensors to determine the age and sex of passing customers. Hooked up to Microsoft's Kinect controller, the shelf will be able to use basic facial features like bone structure to build a profile of a potential snacker.

While pictures of your actual face won't be stored, aggregate demographic data from thousands of transactions will be used to funnel appropriate products for impulse purchase....

It remains to be seen whether the resulting privacy-agro will the negate the obvious advantages of shelf optimisation...