Putting Value On The Radar

Great article on the topic of value - customers want relationships not just low prices

Beyond lowest price - emotional satisfaction is critical

Read it here

Towards A New Understanding Of Value

Earlier this year, the National Retailers Association announced it was going to investigate the effect of continual discounting on Australians’ willingness to buy when goods aren’t on sale. It appears that the collective and seemingly permanent glut of “discount” offers have produced a bargain-shopping monster – savvy consumers who now expect (and regularly wait for) cost savings to appear before purchasing.

And who could blame them? Everyone loves a bargain. Everyone loves good value.

And therein lies the problem.

Across the marketing landscape, the promise of value has become synonymous with discounting. Little surprise we might say, given the recent state of economic woes and the declining middle market. Competition is tight and only made harder by the blurring and multiplication of paths to purchase. Toss in ever-increasing technological advancement and explosion of choice and we find ourselves in a culture where collective consumer expectations of brands have never been higher. We have educated people to expect cost and time savings everywhere. The promise of value is reaching a state of commoditisation.

The more we continue to define value in this way, the more we risk diluting competitive differentiation and true brand positioning.

Let me offer a recent real life example.

Walking up the road to get lunch the other day I stopped in at the local deli and placed my order. Whilst waiting, I flicked open the nearest paper and absent mindedly spun through. About mid way I stopped. Something felt oddly similar. I just didn’t know what. As I backtracked through the pages, it dawned on me that nearly every brand I’d seen advertised was offering a time or cost saving. From large chain retailers to travel providers, the language was wrapped up in the same idea – value.

This perked my curiosity so, on my walk back, I held the thought in mind. As I pondered, I passed by a number of retailers. They were the same ones I’d seen earlier but this time I observed something I hadn’t picked up on before.

The promise of value was screaming out at me everywhere. Literally.

Store after store was using value to drive their competitive point of difference. What struck me was that not one of the brand messages I encountered motivated me to change my behaviour or attitude, let alone move me to purchase.

It suddenly became clear that the more I was promised value, the less I believed I’d receive it. The shopping experience has become saturated with the idea of value – to the point where it now feels narrow, hollow and at worst, irrelevant. It also feels counterintuitive to how many shoppers and consumers define value - getting more than I expected, even if it costs me a bit extra.

With all of this in mind, how do we put the value back into…err…. value?

First, I believe we need to be more targeted and selective about the use of the “v” word in our brand promises and marketing communication. How can you cut through the clutter with clearly defined solutions that solve specific needs of your target market? If saving time and money has become a cost of entry, what else will make your brand relevant?

Second, I believe we need to shift our thinking. What if we re-defined value from “lowest price” to best experience? Through this new lens, time or cost saving can still enter the story but they avoid becoming the entire narrative. It enables us to move brands from a functional promise to an emotion-led experience of value. Innovative brands already tap into this – just look at the rise of destination retailing and sensory marketing as a case in point.

An example of a retailer that I believe delivers “new value” brilliantly is Mecca Cosmetica. What started as an idea in Jo Horgan’s mind 13 years ago has transformed to a multi-million dollar success story. Mecca delivers because they wrap promotions & merchandising around clearly identified shopper missions & needs – not price discounting. Their position in the market is differentiated via their outstanding product choices, unique services and most importantly, memorable customer interactions. They don’t need to ‘promise’ value because they create it each and every time a person walks through the door. Staff are regarded and treated as brand advocates who host the customer experience. Their focus on providing consistently great product and service experiences creates wow-factor, talk-ability and expanded loyalty necessary to driving sales. Their store space is truly a world class brand space.

If we focus less on promising value and more on finding ways for shoppers to experience getting more than they expected, we open ourselves to creative, clever concepts and marketing solutions that drive real shopper engagement, brand loyalty and competitive differentiation.

And surely that's good value for everyone.

The Future of Shopping

Love this because it captures & showcases key shopping trends being seen now with implications for what's next.

(via the brand punk/ resource interactive)

Brands join up with Farmville

Macca's Chicago have just teamed up with Zynga (creators of Farmville + other social media games) to launch a one-day campaign whereby Macca's branded and launched a neighbouring farm on Farmville that enabled players to earn virtual points via McCafe etc to spend within the game. Very cool.

According to Brandchannel:

It’s a significant crossroads for in-game branding and a first-of-its-kind campaign for McDonald’s. McDonald's currently serves 26 million customers daily, while Zynga attracts more than 215 million monthly active users, and FarmVille remains its most popular title.

Dubbed a “neighbor farm” for the one-day campaign which ran yesterday, Farmville highlighted the MacFarm and visitors who helped grow tomatoes or mustard seed crops received in-game rewards dubbed FarmVille McCafe Consumable.

The Consumable is a valuable virtual good that makes game-play easier and delivers energy to players that doubles navigation speed and awards McDonald's Hot Air Balloons for decorating one’s farm.

7-Eleven ran a similar promotion this year (see pic above) when they teamed up with Farmville and integrated Farmville codes onto real products which were sold in 7-Eleven stores (think "Farmville Slurpee")


It allowed customers to "bite - earn - play" as they put it. This was another potent example whereby a brand facilitated the intangible (virtual online game) becoming real.

You know my passionate stance about retail being "anywhere a transaction happens" .......well digital convergence is making this happen (and it's only going to keep getting faster).

This latest Macca's example is further proof that the lines between online and offline have blurred. Savvy brands will continue to find even more ways to create experiences of value within and across these two arenas.

iphone 5 will get us closer to going cashless

The future is mobile and according to Fast Company, Apple is helping it edge forward another step.

Currently under development, iphone 5 due for release in 2011 is being touted to feature cashless payment technology. According to the article in Fastcompany, Apple has just taken out a patent on RFID technology which will enable them build an RFID loop into their iphone circuitry to act as both an RFID tag or tag reader.

This is an exciting revelation that provides further proof that retail has truly shifted to being ‘anywhere a transaction happens’. By thinking of the ‘store’ in these terms, brands open up new opportunities to create even more value, convenience, delight (and differentiation) for shoppers.

The penetration of smart phones will be at the heart of the digital path to purchase. In the USA, Nielsen predicts 51% of all consumers will own a smart phone by 2011. Whilst Morgan Stanley has predicted that by 2014 more Americans will be accessing the internet via mobile devices than desktop computers.

This has massive implications for brands and retailers who will be defined by how they adapt, harness and apply convergent digital solutions into their marketing.

According to the In-Store Marketing Institute, marketers will need to do the following to take full advantage of the new digital era:

1. Focus on insights
2. Look beyond the brand to solutions
3. Focus on message, audience and technology (in that order)
4. Develop relevant content
5. Target
6. Commit the organisation
7. Integrate activity
8. Test
9. Scrutinise partnerships
10. Be ready to adapt

For me, the key points here are integration and ensuring that technology remains the servant (not the master). An exciting time.

Meat Your Match

No longer do you need to worry about choosing the perfect chook. From the most talked about butcher shop in Sydney comes their new educational app "ask the butcher". Once downloaded it helps meat lovers find their perfect cut as well as grab recipe tips for whipping up a meal that would make Jamie proud.

Complementing the app is their "Ask the Butcher" website where anyone can write in and ask for help on meat-related challenges - for example, "How do you cook the perfect steak?" This is a really clever way for the brand to provide value and pre-influence shopper behaviour whilst skillfully capturing (future and existing) customer data to sustain future conversations.

VC's offers home delivery for orders over $100 plus a cooking school and other experiences (like store tours). They are a great local example of a retailer that's truly changing the playing field.

A mobile store in less than an hour?

Retail is anywhere a transaction happens so brands need to do all they can to facilitate shopping experiences for customers that fit into their lives, routines, expectations.

With this in mind, I came across a platform called "mshopper" and wanted to share. It helps retailers set up an m-commerce site within one hour. Obviously proof is in the pudding but as a concept I dig it.....fast, innovative, convenient.