Monday
Feb182008

Blue is the Colour…Blu-ray is the game....

We are all very used to technology companies setting the tech agenda and defining the standards that we as consumers have to buy into.

But what is new is that retailers with their direct relations with customers, market size and wide distribution are now able to be the technology king makers.

 The announcement on Friday by Wal*Mart that they will only stock and support Blu-ray DVDS and their video players is a sharp reminder that what was billed as the format battle of the decade has, I believe, been settled by a knockout blow from retailer Wal*Mart.

Both Sony and Toshiba have been trying to establish their technology as the new standard for the next generation of DVDs for the high definition world. Reminiscent of the battle between VHS and the Betamax format wars of the original video standards but this time the stakes now are higher as this format winner could, if smart, command a premium position in our digitally converging homes.

In January Blue-ray edged ahead of Toshiba’s competing HD-DVD when Warner Brothers said tit would only support Blu-ray. So did other retailers and now Wal*Mart will be taking out of their stores all HD-DVD and will throw their mighty weight and resources behind trying grow sales of Blu-ray.

I predict that Toshiba will be forced to concede defeat shortly.  Proof, if it is needed, that the role retailers are playing in defining the destinies of manufacturers and brand owners is growing rapidly and in unexpected areas. Understanding what drives retailers decisions is critical an ever-increasing number of organisations.

 Consumers have stayed away from the high definition DVD party preferring to wait it out to see which technology wins. With the high growth rates of flat panel TV’s sales, most being high definition compatible, there should be a wealth of consumers looking for high definition content once the format war is over.

But nothing is that cut and dry in the digital space. Retailers will need to move fast on high definition and work out their overall strategy. Sales of games and films will be moving more and more online especially as bandwidth grows. The revenue model is also likely to look different. Sales may move back to the rental mode, for the night or for one viewing and payment may be supported by an advertising revenue model. With viewing and playing subsidised by watching advertising content. All this could see  reducing sales in retail stores and its impact on footfall. So expect to see retailers take positions in the delivery of digital content. Some interesting alliances and opportunities are on the horizon.

In the meantime look forward  seeing brighter, sharper, greater clarity pictures in a living room near you.

David

David Roth

Friday
Feb152008

New way of using posters



Friday
Feb152008

New H&M Flagship store in London

On Valentines Day it was more than romance in the air on Regent Street with H&M's new Flagship Store opening. Hundreds of young fashionistas were queuing outside the old Dickens & Jones building to be one of the first 500 customers to receive a 25% discount in the latest store to open on this revamped street.

The inside of the store is modern with an edgy feel. The merchandise were colour blocked in spring 2008 right on trend fashion colours, the bright and vibrant shade of red, blue and yellow. The garments looked really striking when they were teamed up with black in very distinctive areas with a dark grey  background. Wire cages in the middle section were used for displaying key collections of the womenswear range. They have managed to create interesting  sections in this boxed shape store in a very clever way by using height and a variety of different display units mixing apparel with jewellery, sunglasses, bags and footwear. A great way to show ‘The Look’ and to get shoppers like me to buy more…(M&S please take note!).

 

 

 

A light wall at the back of the store which runs from the basement to the first floor creates a design feature.  The escalators are criss cross and takes you up to the first floor where The womens wear range continues and there is also the menswear department with a denim area in the middle of the floor (see pic). 

The music was catchy and cool and I felt like I could have been in a Abercromie and Fitch store but with daylight, which I don't mind at all since I prefer to see what I buy... The staff were more focused to keep the store tidy rather than serving customers, i wasn't offered any help during my hour in the store. Hmmm maybe it is time for some customer servicetraining!

In the basement you will find the kids range, plus sizes and lingerie departments.

This Swedish fashion brand is definitely back on the Fashion high street brand list and that is nothing to do with me being patriotic...

Maria

Thursday
Feb142008

I went to the new Nokia Flagship Experience Store Regent Street last night ...


 Ok I admit it. I am getting a little nostalgic for the days when a telephone was…a telephone. It stayed in one place, when it rang you picked it up and someone spoke…and that was about it. Last night, when I walked into a Nokia store in London the first thing they wanted to know about was about my lifestyle…to buy a phone! Things have come a long way since Alexander Graham Bell was awarded the first U.S. patent for the invention of the telephone in 1876.

The latest in a series of 18 planned Nokia experience stores around the world opened on Friday in Regent Street London. The 8th store in the program, opening just a day after Chinese New Year- the year of the rat- I’m not certain if the folks at Nokia know but the number eight is exceptionally lucky in Chinese culture. Indeed Chinese mobile phone operators hold back numbers with lots of consecutive eights in them and sell and huge prices. One such number fetched nearly $40,000 at a charity auction in Zhengzhou, Henan Province a while back.

Having been rather wrong footed with the question about my lifestyle I enjoyed the Nokia experience. Not intending to stay long, as I had a lot of things to do that evening, when I looked at the time when I left (on my phone…) I spent over two hours , practically giving up my entire evening to a mobile phone experience that I did not realise I needed when I walked in. But perhaps the best bit from a Nokia point of view is that I did feel a lot better about the Nokia brand. There will be a lot of comparison with the Apple store not least because in Regent Street they are physically opposite each other. Whilst they have some similarities, to me, the biggest difference is this with all Apples talk about the stores being a brand experience, which they undoubtedly are and a master class lesson at that, they are sales focused- nothing wrong in that. Nokia on the other had feels more a place to look, play, experience, ask questions, feel confident in the brand and then buy somewhere else.

So a quick review of the store for those of you who can’t get to see it for yourselves.

Located in prime, expensive and high footfall central London - Regent Street, the public areas cover two floors, with a third for Nokia own use for seminars and meetings.

The store is operated by Nokia directly all the staff work for Nokia. The only one directly owned and operated by Nokia in the UK.

 The ground floor is conceptually divided into four areas that are aimed at different customer types with different requirements with a physical divide for the fifth area which is a store within a store.

The areas are; Essentials- the more familiar, classic Nokia style and layout, Style- for those wanting a stunning stylish look and feel; Business - for the mobile executive and IT manager; and Multimedia, to aim firmly into the phone as the centre of the multi media world. The store within a store houses their upscale brand Vertu, hand built, luxury, sometime jewel encrusted phones at reassuringly expensive prices. So much so that they did not tell me the cost … clearly they had summed me up, correctly, as not having enough money even to think of it.

Go upstairs and the first floor is divided into two sections, frankly there is just too much space on this floor with not enough going on so I would imagine over time more will happen up here. 

At the moment the left hand side is for ‘discover’, where they will have classes on how to use your phone, connectivity, loading pictures, music etc. I suppose basically everything except how to make a call. (Mr Bell would find this ironic and amusing I’m sure).

The other side is ‘engage’ where you can book some time with experts for a one to one sessions. They can also help you with setting etc. A bit like Apples genius bar.  If you need a long time with them there is a small nominal charge of about £8.00.

As you would expect there are lots of plasma screens and lifestyle pictures.

So you have gathered that overall I liked the retail experience, but that is not all the story as from the strategic and brand building perspective it hits the spot as well. Here’s why…

Brands like Nokia need to move the focus of how they are seen to secure future success.  From …a mobile phone manufacturer to being an Internet company and one that is at the centre of the connected world. (Interestingly Nokia has shifted perceptions of itself before in its history having once been best known for making televisions) After all, the Internet is moving…from being welded to your desk in your PC it is now mobile in your pocket, in your phone and at speeds that make the experience useful.  This is too big a strategic challenge to leave in the hands of mobile phone stores. Brands with strategic challenges like this need to control their own destiny or as Andy Grove famously retorted….someone else will. Doing it at retail level is essential. The ‘Experience Store Strategy’ is an important piece of the brand positioning jigsaw.

Conversations in mobile phone stores almost always start with the tariff and then end with the phone. This store turns that model it on its head. The conversation is about the phone.  The tariff is secondary… if you get to it at all. So the brand and functionality drives the process. Adding value to the manufacturer not the network.

The staff are just happy to spend time with you, rather than desperate to get to the close where they can sell you the contact and accessories and yes insurance (where lots of the margin in a mobile phone store is really made). The staff are not incentivised by sales but by brand metrics. This is reinforced by not calling their customers, ‘Customers’ but ‘Guests’. Everyone I met was very helpful, knowledgeable, fun and friendly.. As in my experience, the first questions the staff ask are about your lifestyle so they are able to quickly focus you into products and features that matter to you. This makes the conversation more relevant and quicker.

The environment is enjoyable to be in, it’s a great place spend time. Well designed and makes you feel great about the brand Nokia- it is not dominated by the network operators. You can stay there for 10 minutes or if you get there early ten hours- it’s up to you.

The products are King… The products are King …The products are King… Not the point of sale, not superfluous marketing messages… not network operators vying for their fair share of eyeballs.

The products are real. In the mobile phone shops most of them are dummy, plastic replicas. They just don’t have the tactile feel of a real phone – increasingly this is a brand discriminator.

Content is becoming an increasingly important discriminator in the connected world. Nokia are busy developing content, like the free downloadable country maps that give you navigation for their inbuilt gps functionality phones and their music download sites for the phone.  These need visibility to end-users and the experience store helps get this across.

The thing that the store lacks at the moment is atmosphere and the buzz of loads of people but I hope that will come in time as word spreads.

I hope that Nokia store number Eight is as lucky for them as the Chinese believe.

It deserves to be. Let me know what you think.

Well I’m now off to see head of mobile phones. Having had my Nokia brand experience I now realise that the phone I have is completely wrong for my lifestyle so I need a new one…wish me luck.

David

David Roth

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