Dear Housewares Executive
Having a tough time filling that VP Sales spot? With 5.6 million Americans out of
work at least 6 months, why is it so hard to find good help? Almost on a weekly
basis, some housewares president or CEO calls or emails something like: “Where
can I find someone with experience to run my sales organization” or some other key
position.
With all the online recruiters, the social media sites – and yes, even a top-notch
Web page resource managed by IHA
(http://jobs.housewares.org/home/index.cfm?site_id=446) – those questions
should have stopped years ago. Maybe you’re looking in the wrong places. Another
clue may lie in Labor Department data: 1.5 million jobs were added in the
U.S. in 2011. Maybe you’re competing with other job-creators.
A second conundrum may be trickier for housewares executives to manage in the
year ahead. U.S. retail sales were nearly flat in December versus November (+ .1%
for all retail sales including autos according to the Commerce Department). However,
the December to December comparison was + 6.5%. The conundrum: How
much of these gains were driven by discounts?
Profits could take a big hit in upcoming retailer reports. (Electronics retail hhgregg
Inc. just lowered its guidance for 2012 due to discounting). The effect for housewares
companies is likely to be felt well into 2012 as retailers look for creative ways
to make up for the discount binge that was the 2011 holiday season. That new sales
VP will have his or her hands full. |
REGISTER TODAY- CHESS 2011
The Strategic & Networking Event of the Year for Industry Leaders
October 4-5, 2011
InterContinental
Chicago O’Hare, Rosemont
For more information:
www.housewares.org/chess |
Better Than Perfect
File this under learning from the giants. For several years, Procter and Gamble and
other large consumer packaged goods manufacturers have openly pursued “The Perfect
Order” – a concept for optimizing supply chain efficiency by shipping a complete
order on time, damage-free and to the correct location.
Seems that the concept has some holes in it – specifically, the gaps between supplier
and retailer practices and expectations. As trading partner scorecards have proliferated,
these gaps reveal less-than-perfect scores, often to the surprise of “The Perfect
Order” practitioners.
The solution: use the other company’s definition of perfect, not your own. For example,
some retailers consider an item delivered when it is “received” into their
warehouse management systems which could be hours or days after it has been
physically delivered. The supplier may consider physical receipt as the right target.
The new mantra, described at a recent conference of the Council of Supply Chain Management Professionals in
Philadelphia, is called Service As Measured By the Customer or SAMBC. Speaking at the conference, Deidre White,
associate director of customer service, Procter and Gamble outlined some of the keys to success for the SAMBC initiative.
- Collaboration between supplier and retailer
- Close involvement with all logistics service providers in the supply chain
- Early warning system to detect problems
- Single point of contact
- Specific action plans for each customer
Many housewares companies have long subscribed to the SAMBC concept, way before it had an official moniker.
The metric is simple: For how many customers do you meet or exceed the service targets that they expect? A review
of the keys listed above might help improve your score. |
Trends for 2012
Recognizing that a substantial part of the housewares industry provides products that are connected to food, Business
Watch culled through several prognostications for 2012 and found five interesting areas for new product exploration
in housewares.
- Potatoes and juice. “Have-it-your-way” potatoes (e.g., customized, do-it-yourself mashed potatoes, special cut
fries and homemade chips) will be a big trend according to Andrew Freeman and Co. Howard Schultz, a big
Starbuck operator, recently bought Evolution Fresh and plans to open juice bars in 2012.
- Mediterranean foods. Restaurant menu items of Mediterranean foods grew by nearly 2 percent between 2009
and 2010 according to Technomic. Additional growth is projected, driven by a general interest in eating foods
that are healthier.
- Functional and healthy. Leatherhead Food Research, a market research firm in Great Britain, predicts that aging
Baby Boomers with an interest in maintaining an active lifestyle will drive functional food product launches.
Mintel predicts that “free-from” foods (i.e., no gluten, no dairy, no nuts, etc) will grow well into 2016.
- Nostalgia returns. The Baby Boom generation will control 52% of the total spend on groceries by 2015, according
to Phil Lempert at SupermarketGuru.com. He notes that Boomers are now being targeted by celebrities
from the ‘60s and ‘70s and expects that marketing through nostalgia to this group will spread.
- Men in the kitchen. The Bureau of Labor Statistics reports that 41% of men prepare home meals, a doubling in
just eight years. Regardless of the reason for this trend, the implication for housewares companies points to more
utensils, gadgets and appliances that appeal to men.
|
Application Wars
Half of the smart phone owners and over two-thirds of the tablet owners used mobile shopping apps during the recent
holiday season according to the National Retail Federation. With consumer interest rising, it is not too surprising
to learn that marketing dollars are pouring into this venue. Forrester Research estimated that about $1 billion
would be invested in mobile technology, specifically phone and tablet apps, during 2011. The average cost to build a
smart phone app is just under $50,000 according to Forrester.
Retailers including Walmart, Toys R Us, Brookstone, Kmart, JCPenney and Apple among others, released new mobile
apps for the holiday season. They are leveraging the enhanced capabilities of these devices to improve the instore
shopping experience. For example, scanning and voice-recognition technologies are connecting to store layouts
and product availability databases.
Retailer apps are a counter-move to the pricing research apps such as those available from eBay (RedLaser) and
TheFind. Research conducted by AlixPartners in May, 2011 found that about 40% of the shoppers in their survey
purchased an item on-line and at a lower price after using a pricing research app.
Another technique is to increase the number of exclusive items carried by a particular retailer that would not be found
elsewhere by the price comparison apps. This could bode well for responsive housewares companies that are able to
manage very large numbers of SKUs in their product range.
The speed by which “m-commerce” is evolving appears to be increasing. And there is no one clear direction – it is
evolving on several fronts. Housewares companies should have some interesting discussions with customers exploring
mobile commerce in 2012. |
Growth Pains
Working capital (receivables plus inventory minus payables) increased by 18.2% at large U.S. companies in the second
quarter of 2011 versus the same period in 2010 according to a report by REL Consultancy, a division of Hackett
Group (The Wall Street Journal, November 9, 2011). The inventory component rose 17.1% for those 1,000 non-financial
companies in the study.
Analysts offer divergent interpretations of these numbers. The glass-half-empty analysts say this makes it harder for
companies to convert assets into cash to invest in operations. The glass-half-full folks note that inventories and receivables
may be rising, but they are still below levels from last decade.
With capital spending on the rise since early 2010, the tie-up of working capital does not appear to be muting investments
for growth – at least for those companies able to maneuver these financial levers. |
Email Fortunes
No, not the scammer thing from a “bank” in Nigeria – the marketing and remarketing things. A record number of
promotional emails were sent in December 2011, according to a study of 100 retailers by Responsys, an email marketing
service provider. On average, these companies sent 5.6 emails to each of their online subscribers during the
week prior to Christmas – a 26% increase over 2010. The single busiest day was November 28, aka Cyber Monday.
Remarketing is what online retailers do after a shopper abandons a shopping cart with items in it. They may send one
or more emails to the shopper as a reminder. LuckyBrand.com, a division of Liz Claiborne tested a new approach
which resulted in a 300% increase in sales from remarketing. Here’s how it works. Rather than send all of their reminder
emails at the same time each day (i.e., “batch” processing), their service provider sent three emails to each
shopper as follows: The first one went out 7 minutes after cart abandonment; the second one went out one day and
seven minutes after; and the third email went out seven days and seven minutes after abandonment.
Customers are apparently comfortable with the emails – the unsubscribe rate for the remarketing emails is only 10-
15% of the unsubscribe rate for their normal promotional emails, according to LuckyBrand.com
(Internetretailer.com, November 22, 2011). |
Rating Products
Peer reviews have been a standard component of the big online retailers’ websites for a long time. Now comes some
evidence of their effect on sales. Online luggage retailer eBags Inc. tested a revision to its website which included a
rating for each product. The test was conducted without outside consultant help.
They retained the old site as a control and tested two versions – one that used stars and that used bars to show the
ratings. Sales were about 8% higher on the two test sites, with a small edge to the star site. This is further evidence
that consumer rating systems can make a positive impact on overall site sales, so the use of ratings is likely to spread.
The big question for housewares companies: How do your products stack up against the competition in these ratings? |
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Download the International Home + Housewares Show mobile application now!
The ih+hs 2012 mobile app takes the power of Housewares Connect 365 and places that valuable information right in the palm of your hand. Visit http://m.housewares.org to choose from the iPhone, Android or BlackBerry platforms. |
Differences Between Men and Women
 Plenty of research has defined the shopping behavior differences between men and
women. Recent studies indicate that many of the in-store differences also happen on-line.
An article (posted December 9, 2011 on www.practicalecommerce.com) by Marcia Kaplan
capsulized some of the new research and contained the following succinct recommendations
for on-line merchants.
By catering to the distinctive patterns of males and females, ecommerce merchants can
increase conversion rates.
- If you are serving a mostly male audience, present detailed product descriptions, feature
comparisons to other similar products, and provide customer reviews.
- If you are targeting females, offer an online chat feature, discussion forums, high-quality
visuals, customer reviews, and, if you are selling apparel, provide video clips and slide
shows. Also include a list of recently viewed products and make it easy to return to those
products. Since females do more browsing, ensure that your website allows for easy
switching between related categories. The objective is to make the shopping experience as
social as possible.
- Promotions and sales attract women so ensure that you are keeping up with your competitors with your marketing offers.
- If your products appeal to younger shoppers of both genders, make sure that you provide social media tools so they can share their
experiences with friends. While older males don't like to dither, younger ones enjoy browsing and interacting with others while
shopping.panies: How do your products stack up against the competition in these ratings?
|
Exhibitor Education Debuts on Saturday at 2012 Show
IHA announces the first Exhibitor Education Seminar to be held on Saturday morning, March 10, before the Show opens at 12:30 p.m. Featuring experts on three very hot topics in the industry, the seminar begins at 9 a.m. in Room S501bc, (Level 5, South Building) and exhibitors can attend all three presentations or just the ones of interest. The sessions are:
- 9 a.m.–To Offshore or Reshore? How to Objectively Decide. Presented by
Harry Moser, founder and president of the Reshoring Initiative.
- 10 a.m.–How To Make Your Company Sustainable. Presented by Catherine
Del Spina, vice president, Nextlife, and Robert Dishman.
- 11 a.m.–Social Compliance. Presented by Andrew Farhat, business development
director, Intertek.
No pre-registration is necessary. For more information please contact Ginny Costello at 847-692-0114. |
 Paint the Show Store Pink!
During the International Home + Housewares Show, the Show Store is the place where attendees and exhibitors can make reservationsfor the Housewares Charity Foundation(HCF) gala on Monday, March 12 or purchase tickets to the Industry Breakfast on Tuesday, March 13. The Show Store also has become a shop
where you can make special purchases to benefit The Breast Cancer Researc h
Foundation (BCRF), the HCF’s legacy charity.
We need your help. Please consider donating pink product that can be sold at the Store for a nominal price—under $20—all proceeds to benefit BCRF. In the past, merchandise has included pink hair dryers, hair brushes, thermoses, magnets and bracelets for the cause. For more information on donating, contact Ginny Costello, store proprietor at IHA, 847-692-0114. |
