Multichannelling : Forrester's Latest News

Great piece from Tamara Mendelsohn at Forrester Research. You can get the full article here. But the couple of key points I was interested in:

• This year, 16% of all sales will be influenced by the research people do on the web

• 43% of all purchases will be made at a retailer different to that retailer with whom they did their on line research.

Traditionally, on line research has been limited to big ticket or more technical purchases. For example, over at Bleeding Edge, Jeremy has a great post on how you can save up to 40% when IT shopping. But how far will people go? To what extent will we start to see this in the mass merchants and grocery channels?

Seems to me that consumers are more discerning about how they can use the Web. They still crave the need for instant gratification (i.e. they want the item in their hands now, rather than waiting for it to be shipped) but use comparisons off the web to get the best price. I wonder how the elements of customer service and location still influence the shopper decision?

If you're not going to be the cheapest - you need to be better at something. Better service, better location, better availability of stock - what else? Its a big ask for retailers, but how can suppliers and distributors add to this process?

• Retail sales training - help the retailer convert more shoppers


• Product training - the more information the consumer has usually means they'll ask much tricker questions when in store. In store staff need to be prepared.
  
• Stock availability - either on the shelf/floor, in the warehouse or available within 12-24 hours.

Any other ideas?

Jason Wenn

Will Coles be Too Much for KKR?

KKR have taken out a short term, AUD $16 billion dollar, loan to fund its takeover of Alliance Boots in the UK. Senior management at Alliance Boots stand to gain significant bonuses if the takeover proceeds – up to $15 million for the CEO Richard Baker. Apparently it is a short term finance deal at very high interest rates. It makes us ponder a couple of points:

1. Can KKR still proceed with a timely offer on Coles? Will the UK deal limit the capacity of KKR in the immediate short term?


2. What incentives will KKR offer Coles Management? How does this compare to the Wesfarmers’ offer?

I wonder if we will see the Coles Board attempt to delay proceedings to ensure KKR can make a decent offer?

Jason Wenn

If you're not up by 20% in Western Australia, you're not trying

Earlier we reported a great WA result for David Jones. Following their February announcement of a first half profit increase of nearly 40%, Harvey Norman sales have risen by more than 17% in the March quarter – on the back of strong results in WA and electronics (particularly Plasma and LCD TVs). Total sales for the quarter totaled $1.28 billion, with same store sales up 10.8%.

In spite of a tough market (except for WA!), Harvey Norman expect to maintain sales growth in excess of 10% for the second half of the financial year.

Gerry Harvey was reported in Inside Retailing as saying “If you're not up by 20% in Western Australia, you're not trying…”

So are you up 20% in Western Australia?

Sources: AAP & Inside Retailing

Jason Wenn

Out of Code Promotions

It’s always been tough to manage out of date products for some of our clients, but it might get harder if the ACCC chooses to get involved in out of date promotions. As reported in FOODweek, Cadbury Schweppes have been taken to task over a 250g display of Dairy Milk Triple Decker where a promotion had expired on 31^st December, 2006 and stock were still in a prime aisle gondola display on March 17, 2007. The ACCC aren’t involved in this case, but have in others previously. How can you avoid this scenario?

• Ensure your product has start and finish dates clearly marked on the packaging and associated POS


• Ensure the right level of sell in and manage store allocations carefully


• Brief your merchandising team on close to expiring promotions and optimise sell through tactics (points of display etc) earlier.

Jason Wenn

Someone's Doing It Right - Latest David Jones Sales Figures

In the lead up to and wake of the Myer sell off in Australia, it has been fascinating to watch the David Jones on the up and up.

DJ's have reported an 8.4% increase in March quarter sales. Interestingly, they've opened their first store in 6 years just this month (Burwood NSW), so their sales increase is not on the back of any expansion. There are three other stores opening this year, so I suspect we can see further sales growth.

What are they doing right? Well it seems a visit to the Mens and Womens Apparel, Accessories, Cosmetics, Footwear and Homewares sections might be necessary. They're the standout performers according to CEO Mark McInnes. I might just do that and give you our thoughts.

Predictably, while all states delivered strong sales growth, Western Australia was the stand out performer.

So what do you think they're doing right?

Drop us a note here if you've got some thoughts.

Jason Wenn

Retail Sales Up for March

The latest ABS figures show that Australian retail sales increased in March by 1.1% The seasonally adjusted figure is A$19.03billlion. This represents the biggest gain in 11 months, largely on the back of department stores which increased by 3.6%. Recreational goods were up 2.3% and hospitality sales rose by 1%.

Looking for Some Good Industy News?

At JSA it's vitally important for us to stay in tune with some of the latest trends and research in retail, key account management and sales management.

A couple of great sites that you might like to check out:

• Retail Wire: a great site with some of the latest US news in retail.




• Kamcity: A UK site that has some excellent resources for Key Account Managers. Their newswire service and Something for the Weekend is always interesting.




• Trendwatching: Remember Yuppies, Dinks, Nimby's etc? Well these are the guys who think of those names. Every month they have a new one, some stick some don't. Visit them for the very latest in consumer behaviour




• Sales Machine: A great, often entertaining look at the world of sales and sales management. See their latest article on the Worst Sales Manager's Ever




• Zen Habits: I love this low impact blog on time and self management. Some excellent ideas. Well worth subscribing to. The best one I've seen.




• Presentation Zen: What is it with Zen? Well this is a great source on the latest presentation techniques and innovative ways to avoid Death by Powerpoint. Essential cruising for anyone who is presenting more than once per week.

We'll let you know as interesting pieces come up. But in the meantime add them to your favourites in Internet Explorer or subscribe to the RSS feed. We'd also love to hear of any your suggestions for our other readers.

Just post a comment below.



Jason Wenn

The Relentless Advance of Private Label

Boston Consulting Group have published a useful and concise article on the strategies of those manufacturers who are competing successfully with private label.

Some of the key poings strategies of those manufacturers are:

• They adopt a total category approach. More importantly their definition of the category tends to be broader than most - encompassing usage, demographics and occasion


• They have higher levels of investment in product quality and innovation


• They leverage their economies of scale in manufacturing and supply chain management to provide more SKU varieties at lower costs

BCG have produced a series of questions manufacturer's should be answering to help them understand how well they are and can compete with private label.

See the full article here.

Jason Wenn