Attack of the Tall Dolls

In past generations girls used to play with dolls until the beginning of their teenage years, but research has shown that now girls stop playing with dolls at the age of 7. Disney like Toys 'R' Us are starting to sell taller dolls in order to appeal to the older kids (11 years old) Disney has just come out with Princess Tiana, Ariel, and Cinderella as bigger dolls. It has been researched that the bigger a doll, the more a little girl can relate to it. Dolls are also now coming with more modern clothes and with accesrories such as books in an attempt to reach out to older girls.

I think they are adapting in a very smart way. Research marketing is incredibly important when it comes to this. I have first hand experience watching 7 year old prefer and iphone or ipod than a doll. I think it is going to get very tough for dolls even after this, many challenges arise as the newer generations will all be technology based. Unless these toys become robots within a doll look, I don't see how dolls will continue to exist within the next few generations.

-Jacky Meltzer
http://online.wsj.com/article/SB10001424052702304173704575578291510042572.html?KEYWORDS=retail

Coach Sales, Profit Jump

            Coach Inc.’s sales jumped this past year with a 34% increase on sales and have said that they are ready for the holiday season and beyond. Despite their lower pricing strategies and muted consumer spending, Coach has proved to significantly grow in developing markets. They are extremely thrilled with their success and even have plans to open up more full-priced stores in New York City. Also, because of their increase in sales, they plan to expand in China, where the country “represents the single largest geographic opportunity for Coach”. The article also stated, “Coach posted earnings of $188.9 million from $140.8 million and that revenue jumped 20%.”

            I am actually surprised that their sales have increased because of the fewer amount of consumers buying products in general throughout this bad economy. I would also think that even though they are lowering their prices on their goods that they still wouldn’t increase their sales by much. However, I am proud of their strategies and think that expanding their stores across the nation and around the world will only feed them for even more success. Globalization is said to be one of the most effective factors of succeeding in a business, and I think that Coach will benefit from it.  Do you guys think that they will continue to attract  more costumers to their company, or do you think it will only be a “one-time success”?

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Posted by Tania Dabdoub

Barnes & Noble Creates E-books for Kids

Barnes & Noble is creating new children e-books for their new electronic reading device called Nook Kids. These e-books will include "enhanced editions of classics," picture books, and novels. These new e-books are geared toward 3-8 year olds and will be available online. The Nook Kids electronic readers will have a touch screen display and some of the children e-books will have interactive elements.

With the changing times and changing technology, I see Barnes & Noble's Nook Kids idea to be a way to keep up with these times and stay ahead of competitors. I think some parents will go for the idea, as the enhanced picture books and interactive features will be appealing to their young children and entice them to read and learn. It also, however, could just be putting a video game in the hands of a child; children may skip over the reading aspect and just play around with the interactive features. In addition, the price of these Nook Kids readers must be reasonable because things put into the hands of a young child do suffer a bit of damage. Parents would not want to spend large amounts of money on something that will be broken in a matter of minutes.

It will be interesting to see how many of these Nook Kids readers Barnes & Noble actually sell. It will be an indication of whether technology has now reached an even younger generation or children classics should remain classics in printed form.

http://online.wsj.com/article/SB10001424052702304354104575568741495194492.html?mod=WSJ_Retailing_leftHeadlines

Happy Holidays to the Retail Industry

The National Retail Federation has been doing some research and has concluded that this holiday season consumers will be more flexible with their spending.

A survey of 9,000 consumers revealed:

- 61.7% said the economy will affect their spending

(declined from 65.3%)

- 41.8% said sales or discounts are "the most important factor in their purchasing decision"

(declined from 43.3%)

- 5.3% said customer service is a "more important factor"

(increased from 4.4%)

- 12.7% said "merchandise quality" is also very important

(increased from 11.8%)

- 57.1% said they will "self-indulging," shopping for themselves

(increased from 52.9% )

- 65.1% said they will doing their holiday shopping at discount stores

(decreased from 70.1%)

Overall, the survey shows that this year consumers will be more lenient with their pocket books when the holidays come around. What does this mean for retailers? Retailers will definitely see a boost in profits from holiday shopping traffic, but they will also have to be creative in attracting consumers to shop. More focus will have to be put on the consumers and their wants because more consumers are valuing quality customer service. Quality control is also something retailers will have to consider.

Although many consumers say they will be shopping at discount stores and that discounts are the most important factor in the decision to spend, there has been a significant drop in the number who will be shopping at these discount stores. Discounters will face competition with more expensive stores to attract consumers to their stores, especially with the increase in the number of consumers who want to "self-indulge" this holiday season. Advertising good product quality and good customer service could be a way to lure consumers.

The survey also shows that people are slowly recovering from the economic downturn. It may be getting closer to the time in which consumers return to "normal" spending habits.

http://online.wsj.com/article/BT-CO-20101019-707102.html

Grocery Stores Increase Ad Spending

            During this bad economy, supermarkets (who are now not the only places to buy the groceries) have been spending their money on advertising to repel competition from drug stores and dollar stores. For example, chains including Pacific tea and Safeway Inc. are lowering their prices on numerous items in hopes to attract more customers. Although these chains haven’t increased their profits by much, they are building up their reputation in terms of being known for their low-priced goods. In today’s society, it is also extremely hard to succeed with these type of companies, for they are also competing with places such as Wal-mart, Walgreen Co., and Target-places that all have grocery offerings at cheap prices. In the beginning of this year, data shows that advertising spending rose 19% to $393.3 million. That portrays a  huge increase in spending within this industry.

            What shocks me is that despite their low prices and increase on advertising, these companies aren’t benefiting much from it. For example, Safeway reports to decline 1.1% in third-quarter sales due to their new strategy. Just as Jefferies & Co. analyst Scott Mushkin states,” Advertising alone is not going to be the magic bullet…they have to marry it with real actions.”

            I believe that his statement is 100% true. This new strategy is effective in a way that it will attract a lot more customers. However, advertising alone won't do the job of bringing success to the company. Companies can’t just have the mind-set that they will prosper because of this strategy. They must continue working hard to find ways to bring more and more people to buy from their stores. I am not surprised that many of these chains haven’t done so well, especially this year, for there exists so much competition. After reading this, do you guys think that it is foolish of these companies to spend so much on advertising even if  there shows no increase in sales, or do you think that over time, they will benefit from it?

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Posted by Tania Dabdoub

NFL, Nike Stitch Apparel Deal

There are 53 players per NFL football team, 22 total players on the field at one time, dozens of coaches, coaching assistants, and other staff on the sidelines, referees, and not to mention hundreds of thousands of fans. The NFL is a huge enterprise, so for Nike to be able to claim putting their logo on all of the clothing and equipment for the NFL for a designated number of years is probably one of the best investments a sports attire retailer can make. The Nike symbol will be everywhere; the camera zooms in on the players, it's there; and when fans buy a jersey to support their favorite team and player, it's there.
The NFL needed to sell this advertising niche in order to make up for the deficit and increase revenue. One billion dollars was quite the huge investment on Nike's part, but I am positive that it will be a beneficial partnership for both companies. And, personally, I'm looking forward to seeing the new gear that Nike produces in order to support my NY Giants.

Source: http://online.wsj.com/article/SB10001424052748703440004575548144277455632.html?mod=WSJ_Retailing_leftHeadlines

--Leah Stoltz

School Spending Pumps Up Retail Sales

Septembers' back to school shopping was inspired by all of the promotion through coupons and sales. It was much more successful than retailers had planned for so they are hopping that they can expect more sales during the year-end holidays. Sarah Henry, retail analyst at MFC Global Investment Management said that there is usually a strong statistical correlation between back to schools ales and holiday sales. So it is safe too assume that there should be a rise in sales after the October break where not too much shopping is done.

Playing it safe I think Retailers are being smart in not assuming their sales will be so large, they are being realistic, but as much of the news has been saying, we are slowly coming out of this recession, but if there really is such a strong statistical correlation between back to school sales and holiday sales, hopefully they don't begin to assume higher expectations in the future. Better to be safe.

-Jacky Meltzer

http://online.wsj.com/article/SB10001424052748704696304575537732859742138.html

Burberry as a Role Model in the Retail Industry

The designer clothing company, Burberry, has managed to increase its sales and implement effective budgeting strategies in the current global economic environment.

Most of the company's sales have been generated by growth in China; the company now operates 50 stores in China. The company also cut costs by eliminating "unprofitable" items, limiting overstock, and minimizing discounts and expanded its consumer base with the introduction of a ready to wear and a casual line. The company expects positive results in the form of continuous increasing sales in the future.

Other luxury retailers can look to Burberry as a model of how to survive in the current economic environment. Concentrating on what really makes a profit, like global expansion and universal availability, luxury retailers can report positive sales in a time of limited consumer spending.

Burberry has also exemplified that China is a market that retailers should look to. Growth in China has made it a profitable place to do business and it would be advantageous for retailers to look into tapping into the Asian market.

http://online.wsj.com/article/SB10001424052748703673604575549360918756070.html?mod=WSJ_Retailing_leftHeadlines

Holiday Retail Jobs Maybe on Vacation This Winter

According to the NY Times, retailers are warning this holiday season to hold back on hiring for seasonal positions. Having worked in retail, I know that management looks for permanent positions during this time of year, while also using this temporary labor force to fill the greater need for trained associates around the gift-giving season. Much of the risk surrounding the hiring for seasonal jobs is associated with the flimsy prospects retailers are expecting this Christmas, forecasted by a weak back-to-school August and September. 

I think this is distressing for jobs on several levels. Knocking out seasonal retail jobs during the holidays leaves a huge mass of the public expecting to fill the cyclical unemployment for the year. Teens and college students depend on these low-paying hourly wages to supplement the season's trend of spending. Many families also depend on the jobs in retail to supplement other careers in order to pay for the holidays and the worker's families. Without the temporary positions provided by holiday hiring, people are not able to spend more money, thus also effecting the retailers themselves. 

-Colin

http://www.nytimes.com/2010/10/06/business/06hiring.html?_r=1&scp=1&sq=retail%20labor&st=Search

Target Corp. is on the Move

Target is planning to open "six to 10" stores in Canada in "late 2014 0r 2015." This will be the company's first move out of the United States.

Target, however won't be alone in Canadian territory; Wall Mart Stores Inc. has already been established there for 10 years and other stores such as Khol's Corp. and Victoria's Secret also have plans to open stores in Canada.

This is another example of the ever increasing presence of globalization. Corporations are not limited to any one area and are becoming recognizable on almost all of the world's continents.

Could this stretch across the northern border hurt Target Corp? The Wall Street Journal expresses that some problems are "great distances between large Canadian cities and, in some cases, the need for labeling in both English and French." Moving up north to Canada, however "costs less and carries fewer logistical risks than overseas expansion."

This may be a good way for Target Corp to see how it can operate in another country and to measure if it would be successful over seas.

http://online.wsj.com/article/SB10001424052748704689804575536273265184134.html?mod=WSJ_Retailing_leftHeadlines

Retailers to Challenge Amazon

Many retailers are now coming together to retaliate against Amazon.com Inc. by working with ShopRunner to get rid of shoppers' biggest concerns that waste more of their money: shipping costs. Working with ShopRunner, they are offering FREE 2-day shipping. This company is mostly working towards the costumers that wills pend the most. "-U.S. e-comerce market, one of the fastest-growing parts of the U.S. retail. Mike Golden, President of Shop Runner Inc. said his market research would appeal mostly to those who buy at least eight times in a year from retailers. Unfortunately I cannot find how ShopRunner is doing this business between all of these huge retailer companies because they are not revealing much information as of now.

Its evident that consumers have now come to expect free shipping on most online purchases, at least when they spend up to a certain point. I can personally say how outraged i get when I have to pay for shipping. I have grown accustomed to buying many different things online from usually and almost every time from Amazon.com. the reason i chose to talk about this article is because when we had out last guest speaker, the Leadership one, he referred to Amazon and how Barns and Noble hasn't yet had a comeback for Amazon because Amazon has been such a hit with the consumers that until now there is real competition. It will be interesting to keep track of how sales for for ShopRunner in the future and how Amazon's cliental shifts in the next few months/years. I personally think that Amazon will continue taking the lead in retailer shopping online because aside from free 3-5 day shipping it is also beginning a new program that if you do a free trial of it you receive your shipment for FREE 2 day shipping. Also I think that by placing other cheaper products on the side that recommend you to other sites, it ultimately helps the consumer get the same product for a cheaper cost. 

-Jacky Meltzer

Market Place section in the New York Times

Article: Retailers to Challenge Amazon

Dozens Including Babies 'R' Us, PetSmart to Combine Forces to One-Up 'Prime' Shipping Service

Vans to Roll in Brooklyn

   Later this month, Vans Inc. is planning to open a private skateboard park inside a Brooklyn warehouse. They opened it in hopes to “beef up Vans’s presence in New York and the East Coast.”  It will only be open to skateboarders endorsed by Vans, but there will be some opportunites in which outsiders can get inside the park and use it as well. It opens on October 16^th, where people will get to see a brand new skateboarding course, and a set of stairs and handrailings for skaters to slide down. They are creating this with a desire to expand to the eastern part of the U.S.

   I do think what they are doing is a great idea, for it will be a good strategy to attract customers to their brand. Although it does require a lot of money to build this warehouse, it will hopefully all be worth it in the end. This is a fantastic way for Vans to spread out in different parts of the country and will make it easier for them to make their brand known.  Some may argue that this investment might be a little too pricey to make known their company, but people cannot judge too quickly. All companies do start slow in the beginning, but can quickly speed up their income by attracting more and more people. They also stated that this warehouse will also be hosting events for artists and magazines. Thus, it will be easier for Vans to persuade people to buy their brand. Because of the bandwagon theory that says that people follow popularity, it will apply in this case as well. Once artists use Vans, people will get the idea that they need them as well, and will start buying for themselves. It is also a creative way of advertising. Instead of just doing commercials or using billboards to spread their company throughout the US, they decide to create something entertaining and fun that relates to their brand. Skateboarding is a big trademark of theirs, and so the idea here is that those people endorsed by Vans can skateboard with their shoes. I find it extremely brilliant because not only are they attracting people with their brand, but doing it in a way in which they can be a part of a "skateboard community." I do find success in their business, and believe it will benefit them in a very short period of time. What do you guys think? Do you agree with me that this creation of a skateboard park will work to their advantage? Or do you think that it is a waste of time and money? 

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Posted by Tania Dabdoub

Target Explores Canadian Locations

Target is a huge nationally known company, and it shocked me at first to realize it hasn't moved beyond our country's borders yet. That might change within the next couple years as Target execs have met with Canadian real estate developers to discuss possible development locations. Target will be facing some familiar competition in Canada because Wal-Mart stores have been present in the Canadian market for over a dozen years already, however, it will also have to compete against Hudson's Bay Co. with its The Bay and Zellers chains.  The article explains a couple problem that present itself in the Canadian market which explains why it's taken so long for many companies to expand into our northern neighbor such as the large distance between most large Canadian cities and the need for bilingual labels because of the many French speaking areas.
However, crossing the border to the north is much easier and beneficial than going overseas because it will cost less and carry fewer logistical risks. Many other companies are taking part in this expansion idea as well. Marshalls, Kohl's, J. Crew, and Victoria's Secret might soon move into Canadian retail markets as well.
The convenience of Target- food, clothes, appliances, electronics, pharmaceuticals, and more all in one store- makes it a very typical American store. It will be interesting to watch as Target in introduced to other countries and how these other countries react to the lifestyle of the American convenience.




Source: http://online.wsj.com/article/SB10001424052748704689804575536273265184134.html?mod=WSJ_Retailing_leftHeadlines

--Posted by Leah Stoltz