Determined to make the most of shopping madness, Wal-Mart says its will extend its Black Friday for two Black Fridays. Seriously. The retailer says it has petitioned Martin Rees, the Astronomer Royal at London's Royal National Observatory--asking that Sat., Nov. 24 also officially be named a "Friday." "Because Wal-Mart will offer customers great prices on both Friday and Saturday as the Christmas shopping season moves into high gear," a Wal-Mart spokesperson says, it has "officially recommended the world's official time keeper consider a radical move: creating a week with two Fridays." The letter to Lord Rees asks: "Does a week always have to contain seven days? And do those days always have to be the seven we're accustomed to?" While there's no word on whether Wal-Mart will get its wish, "all this creativity from retailers is evidence that they are very nervous about the coming holiday season," says Kathy Sheehan, senior vice president of GfK Roper Consulting. "With the credit crisis, there's plenty of concern that this will be a soft season, and retailers are strategizing as never before to get people into their stores." Wal-Mart has been steadily cutting prices for the upcoming holiday season since Halloween, weeks ahead of the normal retail schedule. Its latest announcement says it is now moving Black Friday up a day, with specials that start on Thanksgiving itself. The company is posting its entire Black Friday circular online, including "Secret In-Store Specials," such as a Kitchen Aid Classic Stand Mixer for $139. And it will also advertise in-store specials on its site. "It's time to expand 'Black Friday' into three full days for the millions who want this convenience and need these savings," the company says in its announcement. Many of the price cuts are deep, including 60% off a Motorola H670 Bluetooth Earset, 30% off a Garmin Nuvi 650 Portable GPS System, and $100 off certain LCD HDTVs. Wal-Mart definitely has a leg up in the Black Friday marathon. A new poll from Compete shows that the Bentonville, Ark.-based retailer is the No. 1 Black Friday destination for shoppers, with 34% of those polled saying Wal-Mart will be their first stop Friday morning. Best Buy comes in second with 18%, followed by Target, 16%, Macy's 9%, Circuit City, 5%, Sears, 4% and Kohl's 3%. "Other stores" total 11%. And it's also no accident that the Web figures so centrally in Wal-Mart's holiday marketing strategy. A recent survey from shop.org, part of the National Retail Federation, finds that the Internet will influence 30.2% of holiday sales this year, up from 28.9% last year. Still, Sheehan points out, retailers like Wal-Mart are especially vulnerable to the softer economy. Overall, GfK Roper Consulting's October poll on consumer confidence found that 48% of U.S. shoppers are uncertain about the economy, and 39% say they've experienced either job or housing distress in the last six months. And among those earning less than $50,000, who are more likely to have suffered an economic setback, Sheehan says, it tends to be higher: Almost half in that group say they have experienced some kind of financial distress in the last six months. And while one in three polled say there will be less spent on gifts this year, one in two of those who have struggled financially plan to cut back on the gift budget. And meanwhile, Wal-Mart still has its own We-hate-Wal-Mart holiday elves to deal with. WakeUpWalMart.com just unveiled plans for its third-annual "Hope for the Holidays" campaign, and says it will spend $1.5 million on radio ads that highlight what it says are questionable safety practices. The ads point out that 70% of goods on Wal-Mart's shelves come from China, and that Wal-Mart has recalled "more than 25 dangerous products." Ads will run throughout the week. WakeUpWalMart cites a poll, conducted by Peter D. Hart Research Associates, which finds that 60% of frequent Wal-Mart shoppers are uneasy buying Chinese goods. For its part, Wal-Mart last week announced that it had stepped up its Toy Safety Net Program, and that since August, it has tested more than 12,000 toys.
Marketing costs and a warmer fall weighed on Campbell Soup Co.'s first-quarter earnings, with the company posting a 7% net loss for the period and net earnings of $270 million. Earnings per share were down $0.02, to $0.70. "We remain confident in our products and plans for all of our businesses, including U.S. soup," said company CEO Douglas Conant in a report of the earnings. "As we head into the key consumption period for soup, I fully expect that our U.S. soup business will deliver better performance as the year progresses." Much of the loss was attributed to earnings from businesses that had been shut down or sold over the past year. Factoring those businesses out, the company said earnings on continuing businesses increased by $1 million when compared with the same period a year ago. Overall sales increased 7%, to nearly $2.3 billion. In the U.S., soups, sauces and beverage sales were up 4% to nearly $1.1 billion. Condensed and ready-to-serve soups were each down 2%, while sales of Swanson broths and Campbell's Select and Chunky brands were up--thanks to increased promotion and advertising, according to the company. For the period, the company increased its marketing and selling expenses 10%, to $348 million. While the company said increased advertising and promotions boosted the sales of brands such as Campbell's Select, Chunky and Swanson's broths, company executives admitted during a webcast that they still needed to tweak their marketing programs. Marcia Mogelonsky, a senior research analyst at Mintel International in Chicago, tells Marketing Daily that while marketing and weather costs may have played a factor in the company's lackluster first-quarter earnings, the company needs to innovate in its core soups business to really boost sales. While the company had a smart product in its microwavable ready-to-eat soups, innovations since then have been few, she says. "They innovate themselves and then they grind to a halt," Mogelonsky says. "The major reason people have stopped buying [Campbell's] products is because they're bored." "What we've found is, advertising and [promotions] alone are insufficient to change awareness levels with consumers," Conant said. "We can increase our marketing expenses, but we have to follow through in retail channels." Despite the disappointing quarterly earnings, company executives said they still expect to make previously released guidance of 3-4% sales growth over the year, fueled in part by increased advertising and promotions, Conant said.
Xerox reported its first quarterly cash dividend in six years Monday. Analysts believe the positive news points to healthy business practices and finally finding the correct marketing message after many unstable years. Shareholders of record on Dec. 31 will receive a dividend of 4.25 cents per share on Jan. 31, 2008. The company says it's on track this year to deliver between $1.18 and $1.20 earnings per share. With an established business focused on large corporations, Xerox plans to make an aggressive push into the small and mid-size business market. "In the coming year, we will dedicate more marketing funds, increase our online activity and expand our channel distribution to reach small-and-midsize businesses with compelling and practical offerings," says Xerox Chairman and CEO Anne M. Mulcahy in a prepared statement. Through its acquisition of Global Imaging Systems, Xerox has spent the past year building its presence among smaller businesses. The Stamford, Conn. company focuses on the small and medium-sized business market through 22 regional U.S. companies that sell and service document management systems. A company in transition, Xerox introduced color printers and services, improving its balance sheet, and introduced about 100 new products in the past three years. "Xerox has gone through a significant transformation, from a company extremely device- and hardware-focused, to one centered on a balanced portfolio that includes services," says Crawford Del Prete, senior vice president/research at IDC, Framingham, Mass. "That transformation puts a company's identity up for grabs, and employees need to redefine the message they send to existing and potential customers." Success really comes down to marketing and messaging, Del Prete says. For Xerox, the dividends signal good news for the company's strength and performance in the past 10 years since moving away from branding efforts tied to copiers, and onto printing and services. That's when the company began to phase out stand-alone copiers, integrating the technology in a few printers. Xerox spokesperson Michael Moeller argues that marketing efforts contribute only a small portion to the board of director's decision to reinstate dividends. "The board's decision really has to do with increased sales and reduced operational expenses," he says. Xerox confirmed it's on track to generate $1.5 billion in operating cash flow this year and expects to generate about $1.6 billion in 2008. Since launching its stock buyback program in October 2005, Xerox has repurchased about 129 million shares, totaling $2 billion of its $2.5 billion program. In the last year, credit rating services began raising Xerox's bonds to investment grade. Moody's Investors Service last week raised ratings on Xerox's $7.6 billion debt to Baa2 from Baa3, noting the company's solid competitive position, stable profitability, and solid free cash-flow generation.
Power tool company DeWalt may target contractors and pros for its power tools--but the company has, for the past few years, been reaching them not only at work sites, but through its sponsorship of Nascar. Next season, the company will promote its new battery technology at races via a category-exclusive deal with International Speedway Corp., which owns most Nascar race venues. The Baltimore-based DeWalt is launching a line of lithium-ion "Nano Technology" power tools, and repainted the No. 17 DeWalt Tools Ford Fusion driven by Matt Kenseth. The company also tours its Rolling Thunder road show to Nascar races, where it shows off its products and lets contractors try them out. Jon Howland, director of marketing, says the company has been involved with Nascar since 1996, and later signed Kenseth. "As the [Nascar] brand started growing, we increased participation from series sponsorship to tool-category exclusivity International Speedway Corporation," he says. The deal is ongoing. "We will continue to evaluate that as the contract comes up, but we see tremendous value in the program. For us to be able to put tools in users' hands is critical." He says that Nascar makes sense--it is the majority of DeWalt's marketing spend--because it is popular among contractors. "We get some 50,000 participants at races, and more than half are professional contractors," he says. The other sport in which DeWalt is involved as a sponsor, per Howland, is grassroots soccer. "It is the most popular sport in the world, and Hispanic contractors participate in tournaments with local leagues." Pete Morris, vice president/product marketing for cordless tools, says DeWalt's other grassroots strategy involves sending teams to residential and commercial job sites because "the guys buying, who are making decisions, aren't people who necessarily believe everything they read," so it's important, he says, that they get to try them out where they work. Though the housing market has suffered from the sub-prime mortgage crisis, Howland says business hasn't been hurt because professional power tools sales are also fueled by commercial construction, which could be everything from airports to roads. "It's a very robust business. From a construction standpoint, we have a nice balance between commercial, residential and remodeling." Next year, the company will do a major revamp of its Nascar product marketing, including a redesign of Rolling Thunder, and of its mobile-marketing program that involves carting race cars to events and job sites.
Gap has tapped Yahoo to launch its holiday campaign, called GapTIDINGS. The promotion centers on letting consumers create video greetings and e-mail them to family and friends. At the Yahoo-hosted GapTIDINGS (http://gaptidings.yahoo.com) microsite, users are invited to upload their holiday greetings and automatically enter to win one of three limited-edition Vespa LX50 scooters. Users will also find tips and tools for making great videos on the site, like Gap-remixed holiday tunes from artists like Dean Martin and Louis Armstrong that they can add to their creations. They can also view and rate other videos, including greetings uploaded by Gap ambassadors like "Saturday Night Live" comedic duo Amy Poehler and Will Arnett, as well as port their videos to various social networking sites (including MySpace and Facebook). Although Gap unveiled holiday-branded creative in-store over the past week, the digital campaign doesn't officially launch until the Monday after Thanksgiving, also known as Cyber Monday. As part of the multi-platform campaign, Gap has tricked out a mobile recording studio that will prowl the streets of New York in the coming weeks, letting users hop in and create their videos. On select days between Thursday and Dec. 12, the mobile studio will target holiday shoppers at spots like Rockefeller Center and the Union Square Holiday Market, beckoning them to create video greetings. In terms of the logistics, technology and strategy behind bringing video creation tools to the public en masse, it's par for the course for the Web giant, says Conn Fishburn, Yahoo's director of social media strategy. "We have a group that works to help make promotions like this a reality," Fishburn says. "A brand will have a fairly fleshed-out idea, or sometimes even just a set of marketing objectives, and we'll work with them to take the best advantage of all of Yahoo's on- and offline assets to help them reach their target audience." Gap will be supplementing the microsite with "a number of bids on keywords for search, and display media running across the Yahoo network," Fishburn says.
For marketers, the advent of "e-everything" has been a blessing and a curse. Never before have the thoughts and opinions of so many people been so readily accessible. Never before has it been so simple to find and communicate with very specific types of consumers: dog owners, adventure travelers, Hispanic moms, Civil War buffs--you name it, there's an online community for it. Never before has it been so expedient to open a continuous, ongoing dialogue with consumers, as opposed to herding them into a room for a one-off "study" or focus group. And best of all, these dynamic, ad-hoc online communities are global, free and unrestricted, and open to everyone with a network connection. But here's the thing. Today's connected consumers are firmly in control of who participates in their online communities and who doesn't--and they're fine with leaving marketers out of the loop. In fact, many online communities are highly adept not only at shutting out marketers, but also creating an instant backlash against those who attempt to usurp the community for commercial gain. Woe to the marketer who attempts to hype a new "eco-friendly" product on a green-themed Web site or tries to transform a kayaking community into a focus group! Does this mean that there's no way for marketers to leverage these communities for creative marketing? Quite the contrary. There are plenty of opportunities for creative marketers to participate and draw fresh insights while actually adding value to these communities. Online communities offer a chance to collaborate with target consumers and create breakthrough products; to respond to new trends as they emerge; to use integrated research to quantify the potential of new ideas and product concepts; and to gain insights that might otherwise have been missed. Here are a few suggestions, ideas, and real-world examples for interacting with connected consumers and online communities. Be non-intrusive and authentic. Customer communities give you exposure to the universe of authentic voices that comprise a target group--but only if you're authentic and genuine with them. If you initiate communication with the community, ask your questions honestly and expose your motives openly, using your real voice, not marketing-speak. It helps to be "one of them," but if you're not, at least do your homework and know where their interests lie. You'll build trust only through authentic interaction--and once you have trust, you can pose questions, call for ideas, introduce concepts and reward participation. Without trust you're nowhere. Invite them into an environment of your own creation. You don't have to stay on the community's turf and under its control. Build and host a privately managed community and bring together consumers who share a passionate interest: pet owners, organic food consumers, cycling enthusiasts, etc. For example, MarketTools created an online community of 10,000 mothers called the Moms Insight Network, where mothers can come together online and exchange opinions, tastes, preferences, tips and advice, with each other and with marketers. One of our clients tapped into the Moms Insight Network and observed a high level of interest in games and toys that involved more physical exercise, and actually harnessed the creative energies of the group to find specific ideas. Dozens of ideas poured in--including several concepts that are now in the testing and development phases. Find creative ways to use "Web 2.0" or next-generation tools. Whether you call it Web 2.0, the next-generation Web, or some other moniker, there are plenty of interesting new possibilities out there for connecting and interacting with consumers. For example, more than 50 million blogs are now online--many of which have extended networks of readers and responders--presenting an easily accessible source of consumer feedback. The results can be in aggregate with a broad demographic sampling or extremely narrow monitoring of niche points of views. This can be considered "discovery"--the place to find the questions that marketers need to ask, but might not be aware of. Similarly, you may find creative ways to leverage Google's OpenSocial initiative, Facebook brand pages, or the "Social Graph" web of connections between family and friends to get closer to your target consumers. Or you could draw on the rating and reputation systems now commonplace on social networking sites to derive new product possibilities or innovation opportunities. For example, one of our clients, a computer manufacturer, regularly invites its customers to submit ideas and product concepts and then vote on those they think are the most important or promising. Harness the "wisdom of the crowd": With all the participation, contribution and collaborating going on, the question remains: how does a marketer distill the river of information into an actionable insight or hard data for decision making? There are a few options emerging as technologists approach the challenge through algorithms. On the very simple side, there are the ranking systems mentioned earlier, where members weigh in by voting on a point of view or idea using a 1-5 scale. Prediction markets are another tool that has been used to accurately predict the outcomes through the wisdom of crowds. Examples include elections when traditional polls have failed, predicting outcomes of world events, etc. Via wikis, message boards and so on, the crowd becomes more informed--and can replace their investments in the outcome as the body of input is refined. Summary The era of the connected consumer holds boundless possibilities for marketers who want to tap into the wisdom of the community for feedback, guidance, and new ideas and innovations. But if you really want to know what your target consumers are thinking, you will have to evolve your own thinking about how you interact with this new breed of consumers and how you use the new generation of online tools and technologies. For forward-looking marketers, this is a tremendous opportunity, not a threat. Go where your consumers are going: online. Join the community. Participate in the conversation. Get a deeper understanding. And do so with honesty, openness, and integrity. The inevitable result will be greater market success. Jeff Tidwell is the director of panel and community products at MarketTools, and is responsible for defining and overseeing the development of interactive panels and community products for clients. For more on this topic, see his white paper, "Reaching Connected Consumers," at www.markettools.com .