Hot Hotel market gets less roomy

On March 8, we discussed Restoration Hardware, West Elm & Williams-Sonoma getting into the hotel biz. Now you can add another name- J.C. Penney.–hospitality

To be fair, they’re not actually opening actual hotels- just trying to supply them. I doubt that Penney’s wares will compete at places that would have bought decor from Restoration Hardware, West Elm or William-Sonoma. But it is a sign that hospitality – be it the part-time cowboy unregulated tax-dodging sector (airbnb) or the full-time, regulated brands – is a hot sector. Perhaps more competitive than ever – and more fragmented- but hot.

This older article from Skift remains imo a terrific little context-setter on that growth:

5 Charts That Show Why the Travel Industry Is the World’s Fastest Growing Sector

People now travel more. They’re savvy about value, location, decor.  And that travel cements new trade relationships & friendships across borders & cultures. imo the more we travel, the more we learn about the world, and the more we lessen our multicultural ignorance as a species.

So let’s be hospitable. And grow together.



Loyalty and Data – decisions galore!

As one of the oddballs who worked in both the ‘product’ and ‘service’ sectors on both sides of the USA-Canada border, I’ve seen many loyalty programs arrive, and others go bust. Researching what consumers want from their loyalty programs may seem easy (compelling savings rate, relevant incentives to redeem, VIP treatment, respect, easy visible point status, instantly redeemable, few ‘conditions’ or delays to redeem, etc).

Believe it or not- loyalty program design is actually fun! What’s not ‘fun’? Running one! ie if you think running a loyalty program is easy, think again!

These are LOYALTY programs- every move you make is visible to your most valuable players (MVP’s); a misstep is costly- a lesson that some Loyalty ‘experts’ seem reluctant to accept (Air Miles?). In fact, running a loyalty program is so daunting that Canada’s largest grocer, Loblaws resisted implementing one (decades after Metro, Sobeys and Safeway all had one), until their I.T. system had been upgraded and they had access to lessons learned on recently acquired (and admirably run) SDM Optimum program. Better to not launch at all, than launch badly and ruin the brand’s  relationship with MVP’s. Props for the patience and maturity to take that path on that timeline!

And now Nordstrom’s is launching a Visa-based loyalty card.

Nordstrom launches Canadian credit card with loyalty rewards

Why not start their own loyalty program, on their own? Because that would be costly in terms of resource and risk, especially…

  1. Infrastructure complexity & costs
  2. Data security responsibilities/ liability

Well, okay, so now it seems obvious that every firm should just partner up with AirMiles, or Visa or Mastercard or Amex, right? Right?

Well now consider what the downsides of a ‘private label’ loyalty arrangement might be:

  1. you don’t own the data – for modeling, or other analysis (you’re always requesting the data)
  2. you probably won’t get ‘full picture’ data (how they shop/behave across categories, payment methods, channels)
  3. you don’t control ways to access consumers

That’s a sobering list of drawbacks to going the Private Label route, as Nordstrom’s seems to have done.

Can’t really have it all, can you? But then again, decades of experience with loyalty programs teaches us that ‘easy’ doesn’t describe loyalty management, nor the decisions that accompany loyalty management programs. Tread with care!

-and a Financial Post  follow up on Loyalty Cards just a day later:

Canadians just can’t seem to quit loyalty cards, despite all of the data breaches and PR headaches

Steven Litt

Want to be a Research Analyst? Then read Sarah!

Fine blog below; the articulate, diligent Sarah Schmidt (I recommend you follow her!) gathers multiple points of view on the role of Research Analyst.

imo one surprise is how many times you see the same sentiments echoed.

Analysts are talented people and, over the next few years, the industry needs many more of them. Have you got what it takes?  If so, the jobs will be there!

Demographics: Change is Gonna Come

Will your  staffers be humming Dylan? There’s a growing chance they will.

Demographic ‘changes are coming’ -it shouldn’t be a shock.  Are those changes working in your favour? your organization’s favour?

Demographics move so slowly & are so well monitored that some organizations are unhurried to act; they prioritize reacting to short term market change instead. Managers/Marketers/Retailers tend to be recognized, rewarded, feted for ‘reactive’ skills such as acting on shifts in daily public sentiment (which can ‘turn’ on a brand in a moment) or fashion taste (crocs in, uggs in, crocs, out, uggs out,…) or labour swings (outsourcing to freelancers, crowdsourcing, etc).

However, demographics are key b/c they’ll affect who will be on your team, who will be your customers, how you convey your message, which kinds of products & services are more likely to succeed.  And demographic changes, being so comparatively slow paced & inevitable, play the role of the warm water in a soon-to-be boiling pot. Just cuz change is slow doesn’t mean it doesn’t need to be recognized and dealt with. Yet many otherwise-smart organizations fail to make fundamental necessary ‘evolutionary’ changes.

One college I know of, has seen it’s ‘Full-Time’ education arm add more & more in-demand ‘applied’ graduate certificates. The college now emphasizes a faculty’s  industry experience & contacts, ensures students earn industry accreditation  and even makes some courses available on Friday evenings & Saturdays. That shows some demographically-inspired smarts! Such traits have relevant appeal for the rising (& demographically driven) number of ‘mid-career re-education’ seekers. But this same college remains reluctant to face an ever-warming-water fact- ie THIS IS THE NEW REALITY! They won’t admit that consumers seeking mid-career retraining see the college as 1 brand, not 2 schools: ‘Continuing Education’ and ‘Full-Time’??? What dat?!?! At present, the public must navigate two completely separate systems- course calendars, websites, faculty are all 100% separate. The left hand & the right hand of 1 college brand don’t know the other exists. Consumers just want the college’s retaining/ reeducation options to be clear; why must they face a brand with 2 completely different bureaucracies, advertisements, sets of faculty, etc- when courses are offered by the same brand, on the same premises, at only slightly different times of day, days or the week? To consumers seeking re-education option clarity, this is baffling.

But, just b/c that organization won’t react to the ever-warming water, that doesn’t mean YOU should ignore demographic & long term societal changes. Ergo, a few highlights on this fine CBC story:

  • Atlantic Canada (now joins parts of Vancouver Island as) Lead Market for Seniors.
  • More people 65+ than children in Canada now.
  • Boomers are gobbling up jobs, and working later into life.

Enjoy! And consider what changes are a coming for your organization given these slow-churning shifts.



Research Trends to ponder

Key #Research Trends listed by Sarah Schmidt below, are pretty much the same as the ones about which I’ve cautioned students on for years. Nice to see an engaged, connected, objective professional also say these things!

Among my longstanding favourites on her list (Sarah: pls pardon my paraphrasing):

  • Human filtering of data: the value of brevity in a sea of data detail!;
  • a growing role for Qual to answer the key question“Why?”;
  • the ‘Quantification of Qual’ -sentiment analysis, seeded online stimuli, digital ethnography,…
  • the growing potential role of Artificial Intelligence to help find meaning, identify relationships, predict behaviour,…
  • growth of geo-targeted mobile research (& ethical issues it raises!);
  • growing role of Observation (& the Ethical issues THAT raises);
  • the need for ‘poll’ oversight (too Motive-susceptible & sloppy; thankfully MRIA is onto this!);
  • online LIVE research reports (Q-Fi does a fine job here);
  • Continuous / longitudinal research (beyond panels);
  • Agencies and software that offers customizing over canned; and
  • The Growing need to (still!) invest in Secondary (Desk) Research

It’s this last point I’d like students & alumni to pay close attention to. For your career’s sake, stay atop your industry by carefully monitoring lead markets – eg Watch Vancouver Island, Italy or Japan for products & services targeting the Elderly. Watch Japan for Vending. Watch South Korea for Personal Tech. Watch California for Electric Motor Vehicles.

What makes these places become Lead Markets can be factors that are demographic (aging pop), social/lifestyle, economic policy/investment (California’s  state-wide vehicle plug & drive network), related-Industry expertise (AI, programming, entertainment,…) or a combination of these factors eg Japan leads Vending not just due to demography (few young people, hence wage costs escalate) and not just industrial policy/expertise (Auto sector automation –> halo effect on Vending) but also due to Busy Work/Commute Lifestyles (busy to work, busy at work, busy commute—> life’s too busy to wait for store staff, and so Vending’s time-saving is key).

My Reco: 1. Identify the Lead market in your industry. 2. Do desk research on it to find what factors brought it to be at the apex. 3. Monitor it & be ready for the moment you see the boss’s boss’s boss in the elevator & she asks: “So… you’re one of the new cohort- got any new ideas for us?”

Your moment is coming; be ready! Be dedicated to proactive Secondary  research!



Well if it isn’t the new tobacco!- There goes the neighbourhood!

Not surprising to see articles like this: sugar being compared to tobacco- the ever-addictive (& cheap!) sugar, and the taste-bud quenching (& cheap!) salt have been used to excess for generations in a fairly unregulated way. In hindsight, a massive society-wide nutrition-health experiment gone awry.

And now? Whether it’s a fast food firm finally offering non sugary beverages, a soda firm launching stevia versions vs sucrose/ fructose/ fake sweetener, or a frozen meal firm finally reviewing how many times the RDA of sodium they NEED to include to safely preserve that food, companies are reviewing salt & sugar levels. I would bet that a powerful stimuli is being aware there’s a ‘window’ to self-regulate before the government (who foots the long term healthcare bill resulting from such vast over-consumption) steps in.

The mainstream public have finally started to read some labels.

Change is a’comin.

The ‘new tobaccos’: Salt and sugar shunned as packaged food companies cook up healthier recipes

Turn a brand into… a HOTEL experience?

So … upscale home furnishing retailer Williams Sonoma will step into the boutique hotel biz? Intriguing!

Puts them into same family as West Elm and Restoration Hardware – so that ‘home-away-from-home’ will feel more like ‘home-home’, for the 1%ers.

A fine illustration of research: eg on

  • how far you can stretch a brand
  • profiling the habits (eg travel) of your customers

But it’s also a strategic move that’s part of the much larger trend -to maximize the ‘experience’ component of ‘product-based’ brands.

And it’s a fine example of the critical need for a SWOT analysis to include indirect competitive threats! Think about how – some years back- alarm installation firms should have seen Rogers as an upcoming threat – though not at all directly involved in ‘home alarms’ at the time, Rogers’ then-business model meant they already had customer billing info and had wired millions of customers’ homes. They already had bundled product presence in those homes and, presumably, consumer trust.

Lego is now not just a product line but also Legolands & travelling flash exhibits; Marvel is now amusement park rides; National Geographic isn’t primarily a magazine but speaker tours, travel tours with professional guides/photographers, etc.

Can’t wait to see the next unexpected shift of a product-based firm into the experiences category!



What does it take for a new platform to become the norm?

Some fine lessons here on why 3D TV – after an exciting start 7 years ago- has expired without ever becoming ‘the new normal’.

To make that critical shift, a new platform must have a ‘certain magical mix’ of:

  • improved performance or experience over current/new breaking formats;
  • a sufficient, unique supplier content feed;
  • premium but affordable pricing (delicate balancing act!);
  • doesn’t hurt if it gets positive ‘buzz’ eg celeb support; and
  • relatively free from inhibiting negative news/reviews.

3D didn’t cut it, but 4K just might. Consider why betamax, LaserDiscs, Digital tape etc failed to become the norm, but CD’s did. Why Clean Diesel seems doomed to lose out to hydrogen /hybrid engines. Streetcars seem posed to lose out to ‘clean buses’. Why Natural Gas replaced Oil home heating furnaces. Why Netflix replaced Blockbuster-type video stores. Why Blackberry smartphones lost out to those by Apple & Google. Why AltaVista, WebCrawler & Yahoo search lost out to Google. And why Bing hasn’t got Google shaking in its boots.


To buy well, apply classic considerations, not passing fashions

News that Kate Spade is potentially up for sale should trigger some interest;  

Brick & Mortar enterprises remain relevant, especially in fashion, and Kate Spade may be better off -and more successful- if not a solo act eg as a part of Coach, Michael Kors, PVH, VF Corp, or another firm. Who might be interested in buying, and why? Those are 2 separate questions, as different suitors (given each of their own unique situations) may find different aspects of KS to be appealing and different aspects of KS’s shortcomings to be of concern.

One might think of a Buying Analysis as a score-sheet: after a suitor reviews one’s own strategy, cash situation & ‘organic’ growth potential vs their expected grossed-up potential with KS added in, then they should also consider:

  • what is  the Buyer-Target synergy & skill-set fit? (in this case eg Buying savvy; global expansion savvy; the contacts & expertise for strategic, low risk Licensing in other categories, etc);
  • the incremental customer potential;
  • the global sales growth potential;
  • circumstances (media, markets- malls, cities, regions, nations), demographic or psychographic targets…) where the combined assets give a firm ‘next step up’ critical mass in eg operations, manufacturing, negotiating, talent acquisition/management, etc.

Of course, this simple list conceals a ton of ‘due diligence’ complexity- eg some Suitors may be better able than others to get supplier leverage or licensing leverage for KS; some may be better able to house KS as a co-brand within existing real estate; etc, etc, etc.

Still, though each Suitor’s score-sheet will value the same acquisition differently, imo an EXTRA step a suitor should consider is: What happens if I don’t buy it, but a direct or indirect competitor does? That may sound dog-in-the-manger immature, but it’s a worthy exercise, and especially worth objectively looking at ‘What If’ scenarios. For example: LinkedIn allowed Microsoft buy Skype – imo a major miss –> LinkedIn lost a chance to facilitate Business connections & MS immediately won an appealing instant following & credibility. Apple let former Apple staffers create the Nest thermostat, then let Google buy Nest, effectively leaving the usually visionary Cupertino firm in last-in status in Home Nerve Center category. On the other hand, when Nokia was seeking a Suitor, Microsoft’s competitors rightfully snickered when MS bought them, since Nokia had no proprietary/property edge and since its brand equity & following were consumer focused, not business focused —> just buying hardware will not instantly evolve a B2B marketer into an end consumer marketing expert….

Which leaves me asking: if you can assess a scenario in which a potential competitor buys an asset, can you also create a sense of inflated value, or hype, etc to get a competitor to waste attention & resources on a lame duck? Or can you convince them that your ‘Star’ or ticket to growth, is in fact a lame duck? [ I’m going to put this thought on ‘pause’ and re-watch 2014’s underappreciated and seemingly unrealistic sports film, ‘Draft Day’]


Is Uniqlo unique enough to make it?

Japanese giant clothing retailer Uniqlo is arriving in Toronto’s Eaton Center.

It’ll be intriguing to see how they go about carving out a slot for themselves. Whether their USP resonates with enough customers, is yet to be verified. In the GTA, imo

  • Fast Fashion is owned by Zara and H&M.
  • Classic style by Michael Kors, The Bay.
  • Elite designer style by Nordstrom, Saks, Holts.
  • Discounted ‘badge’ apparel by hr2, the Rack,  Marshalls, Winners.
  • Men’s quality affordables? Moores, TipTop (they sell Calvin Klein!).

Uniqlo is destined to be a provider of durable, well constructed ‘new classics’ in multiple colour shades; in the GTA market, they may be in a similar space as Joe Fresh or perhaps Le Chateau. A step above Reitmans or TipTop or Moores. And what about Simons? Arriving (in Mississauga this past March) this savvy Quebec-based banner has a proven ability to offer quality in-style pieces, and decades of success servicing our (more style-conscious) brethren in so-French Canada.

Watch this market battle closely! I don’t expect Uniqlo to mess up inventory selection and logistics the way dearly departed Target did, yet, even with superb execution, Uniqlo’s success is not a foregone conclusion.

They need Marketing impact; watch for them to select homegrown Canuck celebs & to generously bulk up next year’s TIFF swag-bags. What if they were to play a role as primary investor bringing back the defunct World (formerly MasterCard) Fashion Week, to Toronto? THAT would certainly buy them some goodwill and be an attention-getting move for a style-conscious audience.