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The past several months have been pretty much a wasteland for new creative on the retail advertising front. Not that there haven’t been new spots and new ads on the scene, but nothing has stood out as break-through creative or really spot-on branding.

Recently, however a few campaigns have broken that have caught my attention and, I think, the attention of the consumer as well. Additionally, I think these are examples of campaigns that reinforce the stated brand strategies for these stores. Let’s take a look at three of them.

1. Stein Mart. Always a great off-price alternative to the traditional department stores, Stein-Mart has never really differentiated itself with a strong brand message. As a matter of fact, their advertising, in my opinion, has been a non-entity. Great brand strategy but they kept it a secret. The new campaign, however, from Devito-Verdi, really breaks through with a tongue-n-cheek slam on the main floor piano players that so many department stores think are important.

With the pianist (kind of a Will Farrell look-alike) slamming the competition and their policies that ignore what the customer wants, the spots drive home a positioning that makes a lot of sense to today’s smart shoppers. Stein Mart’s business has not kept up with its former pace in recent months. Maybe now that they are taking their brand proposition to the consumer, more will visit the stores. Check out all the spots at their site at:
http://steinmart.com/

2. Kohl’s. The store has been a real success story and their latest campaign featuring their Vera Wang collections is not just another “we’ve hooked up with a designer” series. The spots are creative, contemporary and drive home the personality of Vera and Kohl’s at the same time. Another example of how these specialty stores have taken a position that has made them favorites with customers in all demographic and psychographic groups with the money and the smarts to know they don’t have to spend too much for good style and quality. The spots from McCann are not just fashion and they certainly are a lot more effective than the new Macy’s spots.
3. Wal-Mart. After more than a year of fumbling around with more problems than just some new creative, the world’s largest store broke its first spots since naming the Martin Agency its new AOR a few months ago. It’s interesting that most of the news around the agency change and the new campaigns focused on the fact that it was time to replace the long-standing smiling happy face “Price roll back” spots. From what is written, one would think this is has been Wal-Mart’s only advertising message for years. In fact, the smiley-face campaign was never the majority of the spots that have run for the store. Spots featuring employees, customers, suppliers, charities, and events were extremely well-done and which built the trust of the customer were one of the big reasons that the company has grown to be the most successful retailer in the world.

The new campaign gets back to building that trust while still driving home the fact that Wal-Mart saves you money for the things in your life that you like to do. They are well-produced and targeted and I think it’s time for the company to focus its messages on building the trust and quality of the company while saving its customers money. (”Save Money. Live Better”) I’m not sure what they changed with the media plan, but I used to be hit by at least 4-5 messages a week (and I’m not a high television watcher) and now I have only seen these spots in advertising trade publications and video links. Maybe that’s why the performance has been so poor the past several months. You can check it out in Bob Garfield’s column at www.adage.com.

I’ve said many times that retailers tend to think that branding is nothing more than coming up with a new ad campaign and then wonder why nothing happens with the consumer. In these cases, the positioning is right, the stores get it, and the message is creatively succinct.

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There isn’t a company in the world today that doesn’t emphasize the importance of customer service. Their annual reports always focus on their commitment (and the commitment of their outstanding associates) to meeting the needs of their customers. Their mission statements, while generally hard to understand, somehow insures that customer service (usually in some other ubiquitous terms) is an important part of the company’s vision.

This week, the New York Stock Exchange released its third annual survey of CEO’s from around the world. It wasn’t surprising that these company leaders believe that meeting and exceeding customer expectations is the key to driving sustainable growth in the future. The survey, as reported in USA Today, said that with so much product (and store) parity it was customer service that could be the key differentiator in the marketplace. Sounds like branding to me! The CEO’s also said that they would budget more dollars for customer relationship management in 2008 to reflect that they are serious about serving the customer. This made me wonder if they were as committed to building and strengthening their brands at the same time. If providing great customer service is exceeding customer expectations at the store, and if branding’s job is defining those expectations, then, why do so many companies feel that customer service and branding are two separate functions? Why do HR and Operations determine the service standards and how to implement them while Marketing is charged with developing a brand strategy that will communicate to the customer what to expect when they come to the store? In fact, everyone should work together to insure that the service standards and the brand promises are in synch with each other.

We see so many fast food retailers put a sign up on their marquees or in their windows saying “Now Hiring, Smiling Faces”. Sure we all would rather a smiling face on the other side of the counter or drive-thru window, but what we really want is someone who will get our order right, get it to us fast, and all the time speak a language we can understand. Efficiency is a lot more important in this industry than a gleeful employee (to the customer that is), Looking at last month’s retail sales results, I noted that the stores that did well in an otherwise slow month, were those who are doing a great job with their brands and exceeding customer expectations at the same time.
Stores like Costco (+7.0% comps), Target (+6.1), JCPenney (+11.0) and Nordstrom (+9.4) all have great brands, and they all provide different levels of customer service. But these levels are consistent to what they are promising to their customers via their brand strategy. Costco provides a different level of service than Whole Foods even though they are in similar businesses. Nordstrom promises more service when they sell a pair of shoes than does Payless. JCPenney has gone very promotional, yet still offers a better experience than most department stores out there.

It’s proof once again that when the brand strategy is developed, all of the departments must agree to it and make sure that they live up to it. “Customer Relationship Management” is popular today and a lot of money is being spent to keep existing customers and geting them to spend more. Don’t make it harder than it is. Branding is about the relationship with the customer and it starts with providing customer service that consistently meets or exceeds our marketing promises

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Back when I was SVP-Marketing and Branding at PetSmart, one of the keys to our strategy was identifying the “Truth and The Heart” of the brand. Our agency, Publicis USA, had developed “Truth and The Heart” and maintained—and I agreed—that you first develop the “Truth” or the hard facts of what the brand was (things like number of stores, categories, prices, displays, programs, etc) in order to define your points of differentiation. Once these facts were established, then it was critical to identify and develop “The Heart” of the brand—those emotional reasons for shopping the store, whether it was caring associates, programs like pet adoptions, easy refunds, personal communications, professional vets or trainers, in order to build a true relationship with our customer. And if you have no relationship with them, then you really don’t have a brand that will succeed.

This all came back to me while attending the National Speakers Association Annual Convention in San Diego this week. Speaker after speaker zeroed in on this past year’s theme by emphasizing that to be an effective communicator who has an impact on his/her audience, you had to have differentiating substance to what your topics, your target audience, and your calls to action would be; what is it that separates you from the thousands of others on the platforms at the many meetings and conferences held each year? To that end, I have focused my presentations this year specifically on the importance of getting people on the floor and throughout the organization to live up to the brand in everything they do on the job. Unless we achieve totalbrandintegration® in making sure our culture reflects the brand strategy we are communicating to our customers, there is little chance for long-term success.

The most important ingredient for this brand culture is to develop a “soul” in our people that truly makes this a way of life as they service our customers. For years, Southwest Airlines has been known not only as the country’s most successful airline but as the airline whose people personify its brand. As their COO said not long ago, “We are a company in the customer service business who happens to fly airplanes.” No question where Herb Kelleher put the soul and substance in his company.

While I was in Juneau, Alaska, a couple weeks ago, we decided to take the city bus out to Mendenhall Glacier for the day. As I waited, a young man named William spotted that I was wearing a Cox Broadcasting fleece vest and struck up a conversation. He was thinking that I might have an opportunity for him in television. I quickly clarified that it was a free-bee, but he was really interested in marketing and the future of big companies in the US. While he was a musician, he asked some relevant questions about my thoughts on whether all of the consolidations, buyouts, and venture capital takeovers would reduce the competitive market so much that there would be no innovation and no excitement in consumer marketing. Thinking about it, I assured him that there was still plenty of competition and plenty of good marketing—if we maintain branding as the soul and substance of our stores, products, or services. Having recently worked for some venture capital investors, I was made aware of the importance of cash flow and making the sales numbers. I’m afraid sometimes we forget that it is the “soul” of the business and the way our people relate to the customer that really makes the difference. William asked the right questions, and as I watched the glacier “calve” in many pieces, I thought how many chains are also falling apart because they miss the two most important ingredients that make a lasting contract with their customers.

Last week, I spoke to a Brand Management class of MBA students at the University of South Florida where we had a lively discussion about how long it takes for branding to work. I had stated in my presentation that many companies, especially retailers, fail to establish their brands because they are looking for immediate results (sales) as soon as they start their marketing efforts behind the brand strategy. So often what happens is that the company or store will spend months with consultants and/or agencies. developing a strategy within the organization Then they will budget an aggressive amount of advertising and marketing funds to launch the new strategy, much of which is upfront to “really hit the ground running”. After a couple months or so, they are quick to pull the plug—or at least go into hibernation marketing-wise—because they are not seeing an immediate return on their advertising investment.

This sort of reminds me of the 15-minute dating services that you may have seen on some of the news magazine programs recently. You know, this is where about 15 single guys and 15 single ladies sign up for a night of a dating blitz where they each get 15 minutes at a table together, then the bell goes off and they all scatter (like musical chairs participants) to another table and another Mr. or Ms. Right and start all over again. They do this all night and then hope that they get a subsequent, more quality, date with the one they liked best. One thing is for sure, these are not relationship workshops. “Whiz bam, thank you Ma’am” is more like it. Retailers today think about marketing and branding in the same way. Build a multi-media campaign, blitz the airways over a few weeks and then watch the customers pour in with their cash to make a purchase and, of course, become loyal shoppers who want to sign up immediately for your CRM card and carefully thought-out e-mailings targeted for their need and likes.

Well, as I told the students that night, it just doesn’t work that way. Branding is building a meaningful relationship with your customers and potential customers. And it just doesn’t happen in a couple 30-second or 16-page by-chance encounters. It takes time and it takes consistency for the relationship to develop. It also takes internal development (kind of like getting the right clothes or make-up for that dating session) to ensure that the organization understands what kind of relationship you expect them to have with the customer. Some of the most successful brands have kept the same brand strategy, with revisions to keep up with the times and changing competition, for many years to insure a loyal customer base and relationship. Sure the communications have to be freshened up with new messages and new creative, but the strategy (if sound) must be nurtured in all aspects of the business if you want to keep a positive relationship with the customer.

Daniel Burrus, CEO of Burrus Research, spoke recently at the Global Retail Marketing Summit in St. Petersburg, FL about the importance of building a relationship. In fact, he said, “The future is all about Relationships.” The key he said was to enhance TRUST with your customers if you are going to succeed. We have to “de-commoditize” continuously if we are going to stay ahead of the competition by constantly exceeding customer expectations. The importance of keeping at it everlastingly (as N.W. Ayer once said) will strengthen our brands and keep the entire organization on track.

As I get ready to go to Alaska for two weeks of relationship building with my wife, Sandi (and to celebrate our 40th Anniversary), I am more convinced than ever that to build a brand or a relationship, one must be committed to it, have a passion for it, and work hard at it…everyday.

Click below to view my interview on Media Talk last week.

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John Costello is one of the top marketers in the U.S. and has made his mark at Home Deport, Sears, and Yahoo and is now President—Consumer & Retailer at Pay By Touch. The new company uses technology to use fingerprints, among other things, to identify customer shopping behaviors and preferences. Well, John certainly left his fingerprint on the recent Global Retail Marketing Association’s inaugural Summit at St. Petersburg Beach. A common thread throughout the excellent presentations at this meeting was the skyrocketing growth of technology, especially mobile media (cell phones), for retailers and service providers in today’s marketing programs.

One of the points John made, however, really resonated with me and my passion to get everyone in the organization involved with the brand strategy. He recommended that today’s successful marketing organizations should be organized by objective rather than by function as has been the norm for years. Instead of having VP’s of Advertising, Marketing, Branding, Creative, etc., the marketing organization leaders should be determined by the Who (most important customer segments), the What (differentiates the brand vs. competition), and the How (integrated marketing and advertising). To accomplish this, the former VP’s would now take on the rolls such as VP-Customer Intelligence and Insights (Who), VP-Brand and Product Marketing (What) and VP-Integrated Marketing Communications (How).

I think it’s about time that this type of thinking becomes the norm in our organizations where the brand should drive not just the marketing functions, but the entire organization. The operations need to be clued in to the brand strategy and organized so that the place where the customer gets his/her brand impression (the store) is consistent to the message. Human Resources needs to be set in finding people who will live up to the brand – whether it’s at the store or behind the scenes, IT needs to provide the technology and systems to stay up with the brand strategy and a technology savvy customer and employee base. The CEO has to become the Brand Champion who sets the pace, ensuring that the message is integrated into all decisions going forward. In short, it’s everyone’s job and it should be organized around the brand not around a chart of functions.

Until we get over the silos that currently hinder the effectiveness of today’s organizations and truly understand that the brand is the DNA that makes up the store, product or service’s reason for being, I’m afraid branding will continue to be simply a marketing function—for those who want to see their market share dwindle in the future.

For more information about the GRMA Summit, go to www.globalretailmarketing.com . Kudo’s to Sonny Nardulli and Stephanie Fischer on bringing a great forum for progressive thinkers to the retail industry.

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Last week, my former employer, Circuit City, announced a new wave of cost cutting efforts where by 3,400 employees would be fired and replaced by lower-paid workers in order to become more competitive with other electronics retailers. However, being competitive doesn’t necessarily mean that you have to have the lowest cost efficiencies and lower sale prices,. To me, this is just another step in becoming less of a factor in their category and a guarantee that the market share will continue to erode.

Back in the mid-90’s, Circuit City was the number one choice by American consumers for their electronics and appliance purchases. At that time, we conducted over 3000 interviews with consumers and determined that, in fact, most of them preferred the CC format in providing knowledgeable salespeople and helpful service while maintaining competitive pricing. Just a couple years ago, while working in that category again on the agency side, I consistently read a lot of research indicating that customers, especially females (who now have a say in over 80% of electronics purchases), still had a lot of questions when it came to making technology purchases and would appreciate someone more than a cashier when deciding on what to buy.

The discontinuance of commission salespeople accelerated CC’s move toward self-service and the latest move should put them right there with Wal-Mart who doesn’t promise to be anything more than a low price source. I can’t help but think of The Container Store where they have not only one of the most loyal employee groups, but also one of the highest paid. Consistently rated one of the best places to work in the country, The Container Store has made selling basic “stuff” exciting and it all happens at the store level. I recall hearing the companies’ founders, Kip Tindell and Garrett Boone, say that the key was keeping and paying the best employees. They insisted that a great employee could do more work than three so-so employees and they could pay them twice as much and still be cost effective.

Branding is much more than just a low price. It starts with a great strategy and then having people in the store (who are the brand to the customer) who are motivated and excited about the store and the merchandise they sell. With this latest move, I’m sure that the quality of service at a store that used to promote it was “where service is state of the art” will become not only non-existent, but also a detriment to future share growth. No wonder more electronics buyers (note I did not say “shoppers”) are going on-line or to the warehouse stores to get what they want.

It forecasts a continuance of Circuit City’s lagging sales and diminished market share trends, and I don’t think even having Jim Nantz (who, by the way, did the play by play of the Florida Gators’ championship win) in their commercials will motivate the customers to come back or the employees to do a great job.

As the New Year quickly gets moving and Wal-Mart reorganizes its marketing, (No, I am not going to talk about the changes that every advertising and retail publication has covered in every little detail>), it’s time to look for some new ideas in strengthening our brands.

With the Super Bowl finally drawing near, I was thinking about how all the bowl games are now branded and the stadiums also sport commercial names. It’s ironic that the “big game” is going to be played in Dolphin Stadium, formerly known as ProPlayer Stadium, former known as Joe Robbie Stadium. For building awareness, paying several million dollars to put your name on the stadium is not a bad idea. Well, unless, you were the Astros who played in Enron Stadium. The team got better. The stadium changed names for obvious reasons.

Anyway, I was intrigued last summer while waiting to arrive at our gate at London’s Heathrow airport. All the jet ways were labeled HSBC. I’m sure some travelers thought this stood for Heathrow’s Super Baggage Corridors rather than one of the world’s largest banks, which must need more awareness around the world. However, as I sat there I was curious about the idea of using these usually bland jet ways as a branding device and thought that this is really good real estate to build awareness and recognition for international travelers and business people. (By the way, the letters stand for the Hongkong and Shanghai Banking Corporation in case you were wondering.) All I knew about them is that they handle the finance offers for a lot of retailers, like Levitz, so that you don’t have to pay for that sofa until 2010.

Shortly thereafter, I was flying into JFK airport in New York and low and behold their jet ways were HSBC sponsored as well. As a matter of fact, it seemed like I was now seeing HSBC wherever I looked in the city. A growing company using innovative ways to gain higher brand recognition. I started thinking, wouldn’t it make sense for Macy’s to have their names on all the jet ways at LaGuardia or Newark? What about American Tourister or TravelPro luggage at other airports, or maybe they could sponsor the baggage wagons that come out to unload the planes. Speaking of planes, we’ve seen the Shamu version of some Southwest Airlines planes sponsored by Sea Worlkd; why not have each plan sponsored (much like the busses in some metro areas)? We could fly in the Target plane to Minneapolis, or the Home Depot 737 to Atlanta. Maybe a Neiman Marcus jet to Dallas. I know that Frontier Airlines was going to sponsor their airsick bags and plastic ware. So many branding opportunities…

I was always impressed by the Target logo in the end zones right between the goal posts at NFL stadiums. I thought the Sports Authority logos at courtside and rink side at many venues made good sense. Branding isn’t just another great ad or commercial, it’s using available venues to further enhance not just awareness, but also the personality of the brand. So many retailers are stuck on running weekly circulars, price and item TV spots, and a “vigorous” website. Circuit City ran an ad this week for it’s Firedog computer services. It was great because it promoted the fact that the company was giving a donation to America’s firefighters to support their important role in the communities. Enhanced the brand and said we are more than just the next big deal on an HD big screen TV.
Building a relationship with your customers is what branding is all about. It’s not just another ad in the paper or name on the jetway.

By the way, learn branding ideas from 18 experts, including yours truly, in the valuable book, Marketing Magic. Cover price is $19.99, but it’s only $10 if you order it online through my website at www.kenbanks.com.

The Good News and The Bad News…From Bentonville

It’s the holiday selling season and there’s a lot of news in retail, especially from the center of the retail world in Arkansas. While there are many other stores to talk about, let’s take a look at two stories worth considering.

First the good news. Thanksgiving has come and gone and by now the 40 pounds of newsprint that landed in my driveway has made its way to the recycle bin. Of all the ads and inserts in my paper, I couldn’t help but read one from cover to cover. It had the best photography, the right gift items, and probably the best prices. No it wasn’t Target (as good as their ads always are). Penney’s spent a lot, but looked like everyone else. Nordstrom, Macy’s and Dillards looked like—well, like department stores. The best of the batch, in my opinion, was a slick-looking 16-page standard insert from none other than Sam’s Club. Great photography, heavy, quality stock, terrific items, subtle prices with not so subtle savings. Made me want to read every bit of copy and check every price. While you could argue was this vehicle incongruous with a warehouse club store, you couldn’t argue with the creativity and the savings. Of course, Costco, as always, didn’t run any advertising, but Sam’s set the pace with this circular and I suspect resulted in far better performance than their parent discount chain.

Which brings me to the bad news (unless you’re Target or Kmart). First, as a consumer, I didn’t feel the presence of Wal-Mart at all during the Thanksgiving week. I saw more of the spots from the union trying to break down the conditions of working for the world’s largest retailer than I did from the store. Usually, a dominant player, I didn’t even see a Wal-Mart preprint and the television was transparent. Maybe the new marketing gurus from Chrysler and Frito-Lay had them running ads in Real Simple or Field and Stream magazinea. The lack of any presence by the largest retailer makes you wonder what’s happening in Bentonville. Obviously, from the sales results, consumers felt the same way.

To me it’s another example of this store trying to act like a packaged goods or automotive marketer and forgetting the sense of urgency that retail demands. The fact that they took their eye off the ball to conduct an 8-month agency review (who needed that anyway??), then selected one that really has no retail experience, then fired the key marketing exec from Chrysler and her assistant and then unbelievably started the agency review all over again. Something stinks here. Now they are going to waste another 8 months and countless marketing energy by renewing the search (oh, to be an agency search consultant!) I went into a Wal-Mart this weekend and I think they were as well merchandised as ever. The big difference was that there were no lines at the registers and that really worries me. How blind can they be to their problems? The great brand is in jeopardy.

We will have to see how the Holidays finish for sales, but I hope the news at your company and home is all good . Happy Holidays…

Those who have been reading these articles for the past 14 months know that I have been anything but sympathetic to the trials and downward trends in the department store category. As we get ready for another Holiday Selling Season where Wal-Mart has already taken off the price gloves, (why do they have to make those announcements to tip off the competition anyway?) it’s obvious that branding will once again take a back seat to promotion. Of course, this will show that these retailers really mean business to get their sales trends back on track. On the other hand, recent monthly sales reports once again show that one chain, JC Penney with an 8.1% comp increase, continues its remarkable recovery as the pacesetter in this category.

Recently, I was fortunate to be with fellow RAMA board member and JCP CMO, Mike Boylson at a seminar in Columbus. While there, Mike described Penney’s strategy and efforts in righting that ship and increasing its stock price by some ten times over the past five years or so. Now, I have not been a big fan of the Penney organization since it dismantled my long-term employer, Eckerd Drugs, and basically made one of the strongest brands disintegrate before our eyes in order to fuel the department store’s recovery. However, you have to hand it to the company and Mike’s marketing efforts in making the stores not only exciting to shop, but also one of the most creative branding voices in the marketplace. Penney’s advertising efforts have been consistently on target and freshly creative, but more importantly, the store has moved into marketing venues to elevate a strong brand (with the mature customers anyway) into a higher state of excitement.

Its pop-up store in Times Square was exciting and a great vehicle to say that this is not your father’s Oldsmobile anymore. It’s tie in with MTV with the VMA’s, its JAM after school promotion, and its ongoing sponsorship of high profile media events like the Academy Awards continue to build it’s brand. The strong commitment to its own brands, like Arizona Jeans Company, show a packaged good mentality works or as Doner CEO Alan Kalter says “Think like a brand, act like a store.” Penney’s new agreement with Sephora is going to separate them from all the other stores who sell cosmetics and fragrance. Facing stiff competition from Kohl’s and other specialty retailers, Penney’s is now looking at free-standing sites which, in my opinion, will generate more traffic and a lot of customers who don’t think the malls offer anything exciting.

But it’s not an easy journey. As Mike told me, the brand has a long way to go before it wins over the Gen X and Gen Y customers without losing its mature customers who still believe in the quality of the JC Penney experience. What impressed me is that Mike and JCP know that building and re-building the brand that James Cash Penney started over a hundred years ago is an ongoing and long-term commitment that must touch all areas of the store and its communications. Compare this to Sears who can’t quite figure out if it should sell washing machines or washed jeans. Or Dillard’s whose advertising looks like it’s right out Vogue magazine (a 1965 issue, that is). Penney’s realizes that it must get its brand positioned in vehicles and media in an innovative, unique way. The customers don’t want more of the same and they won’t reject the stores that don’t change. In fact, they simply won’t even consider them. Penney’s may not have won over everyone yet, but you got to give them credit for making the brand more relevant and positioning it to warrant more of the customer’s cash.

“The friendly smile, the word of greeting, are certainly something fleeting and seemingly insubstantial. You can’t take them with you. But they work for good beyond your power to measure their influence.” — James Cash Penney

A GREAT HOLIDAY GIFT FOR YOUR STAFF

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