For Retailers, The Struggle Continues

Two years ago I wrote about the struggle of retailers. At that time the big story was Target’s retreat from Canada. The chain closed 133 stores, laid-off 17,600 employees and absorbed US$2-billion in losses. That figure did not include the $7 billion the company invested to enter the market.

Target dominated the headlines but at the same time in Canada Sony closed all 14 of its stores, Mexx 95, Smart Set 107, and Jacob 92. In North America, Staples shuttered 225 stores, Office Depot 500, Radio Shack 200, Abercrombie & Fitch 180, Aeropostale 250, JC Penny 39, Wet Seal 338 and Coach 70.

Are they missed? Not really and the numbers and types of stores shedding physical locations continues to grow. Credit consulting firm F&D Reports that in the U.S. 3,600 stores have closed since January. That is about 20 a day. The firm expects the number will reach 10,000 by the end of the year. Vulnerable brands include Neiman Marcus, Sears (no surprise), Claire’s, and J. Crew.

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10 Communications Challenges

Communications holds the power to change minds, prompt action and move the world. But it has to get better. It has to strive to be the best. In business communications, we have identified ten challenges that are standing in the way of it being better. These come from the breadth and depth of our work with leading brands and brands that want to lead.

Challenge #1

Everyone is talking about disruptions and innovation yet communications are predictable, safe and boring. Are you satisfied with being a me-too brand? Communications that are compelling and different are in short supply. Effort and spend are going up in smoke. Too few brands are bold.

Challenge #2

Communicators are attracted to shiny new toys and forget the fundamentals. Are you overcomplicating while missing the tried and true? Social media, V/R, video, SEO, programmatic – these are important tactics but they are that, tactics. What is missing is smart, sharp and penetrating strategies.

Challenge #3

Businesses think impersonally in terms of “audiences” and “targets” and “markets”. Do you really know who wants and needs what you have? The science and art of segmentation is a terrible state these days. The business schools teach it poorly and businesses employ it haphazardly. This leaves very real customers thinking you do not know them or care to.

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Tiny Muses: The Appeal of Writing Cabins

You do not have to be a writer to want a private little cabin…but it helps. The solitude, peace and focus could keep the words flowing. Here is a question, could you go without Internet in your small pad? Author Jonathan Franzen writes in the big city but on a computer without online connection. And that is the point, to make sense of the world either through fiction or nonfiction, you have to disconnect. Imagine doing so in any of these tiny muses.

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The Hot Dog Stand Story

This business fable has stayed with me since I first heard it in university. Over the years, interpretations have popped up at conferences, meetings and in articles. It is an entertaining tale offering different lessons depending on what is emphasized. Apologies to the original author. I would gladly give credit if I knew who you are. Here is my version.

There was a man who ran a roadside hot dog stand. It was located far outside the city. For years he worked hard to make it a success. That effort paid off and eventually people would travel long distances for one of his hot dogs. It became a popular and sentimental institution. Families formed traditions around visiting the stand and tourists were told to fit it into their schedule if possible.

So what made it special? It was not one thing, it was a combination of quality and care that was difficult to match or copy.

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There Is Too Much Written Content

Every day your inbox is pummeled by content you forgot you signed up for (or probably didn’t). You are on Flipboard, Twitter, LinkedIn and a bunch of other time sucking “tools” you vow not to check but you do. It doesn’t help that you are “pinged” every minute like Pavlov’s dog. Texts and Facebook Messenger fight for your attention. Friends send you stuff they think is interesting. Then there is traditional media struggling for your attention.

There is so much content. The world now has 1 billion websites. You can read 470 million blogs…I know this seems awfully low but most go dormant after a post or two because they offer zero value. Still, there are tens of millions of posts every day. Online magazines are ever growing. There are really no accurate counts. Suffice it to say there is overwhelming content. And way too much bad content.

The net and social media promised dialogue but it is a one-way loudspeaker. Everything screams at us with a false sense of urgency, importance and value. It is like everything stated should have an exclamation point. At the same time the content is horrendously dumbed down. It starts with attempts to hook us with titles like these:

The Numbered List: 7 Ways To Irritate Your Partner

How-To: Build Your Own Aircraft Carrier

Case Study: How We Grew Our Twitter Followers By Buying Them

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The Right Place to Write

Tyler Moss, Managing Editor at Writer’s Digest, inspired me with a tweet today. Tyler shared this photo of Roald Dahl from 1979. It shows the author in the garden shed where he wrote many of his books—including Charlie & the Chocolate Factory. I was struck by the image. It is obviously far from opulent given locale and decor. In fact, Dahl is dangerously fending off the cold in a sleeping bag all too close to portable propane heater.

There is plenty more to observe and enjoy. Two rotatory phones, a steamer trunk for a footrest, wastebasket full of discarded writing, a homemade writing table resting on an older chair. Beyond the tangible items I had to ask myself, could the space be any less inspirational? But to each his own and I cannot argue with Dahl’s prolific output. It worked for him so I thought where do other notable writers ply their trade and love?

Sebastian Faulks wrote Human Traces, Engleby and Devil May Care in this space. He has noted that the window and its view provide helpful respites from the page. It is tight and focused. There is precious little decoration but comes with the advice to “Carry On”.

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Missed Merger Opportunity?

Last November, Publicis Chairman and Chief Executive Maurice Lévy, announced a merger to create an “unmatched leader”. This combination of two agencies was orchestrated to “serve clients that are transforming into digitally-driven businesses in a marketplace that is undergoing a rapid pace of change”. Levy was heralding the union of SapientNitro and Razorfish.

Both are veterans of the digital wars. They have lived through the dotcom bust, the advent and expansion of social media, and were independently trying to define what digital means to business before being combined. Undeniably they had two of the coolest names in the business.

Lévy noted at the time of the merger, “When we formed Publicis.Sapient we integrated the strongest set of capabilities in digital, consulting and technology amongst any of our peer group. We are now taking this next, important step, to further integrate these formidable assets. SapientRazorfish is a powerful new entity in the marketplace uniquely combining customer experience strategy, omni channel commerce, and technology deployment to create a new breed of digital transformation partner pointed at today’s most critical client need – reshaping their businesses for the future.”

That is a lot of industry jargon but you get the gist. What I took away from it is Publicis had no real merger or integration plan. They just hoped the merged management groups would create some magic. Along the way I am sure they hoped for cost savings by paring down staff and real estate.

Fast-forward four months and Publicis reported it would write down its digital arm, Publicis.Sapient, that houses SapientNitro, by roughly $1.5 billion or almost half of its initial valuation. Analysts and media saw this happening for a few different reasons. Some pointed to spending too much on Sapient (Publicis paid $3.7 billion in 2014}. Others suggest it has become a drag on Publicis’ overall business. While still another contingent believe the merger with Razorfish is to blame.

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This is not a Turf War: Consultancies as Agencies and Agencies as Consultancies

Consulting firms have always sized-up the marketing space as a potential service offering. They have flirted with it for decades. Most large-scale forays have ended up in retreat after just a few years. Meanwhile, ad agencies have long-looked to shore up their dusty, old revenue models and expand by purportedly delivering more strategic offers. This too, has been largely episodic and unsuccessful.

Stick around and I will tell you why neither have historically worked but why they may work now. First off let’s substantiate that this mash-up is taking place:

  • Eight of North America’s top 10 agencies are owned by consultancies. Accenture has acquired at least 40 of them. Deloitte, Accenture, KPMG, PwC, and McKinsey now have agency arms.
  • Deloitte is out to create “the world’s first creative digital consultancy.” Meanwhile, IBM’s digital agency unit, iX, has over 10,000 employees and 1,000 designers in 25 offices worldwide.
  • Del Monte Foods selected Epsilon as its U.S. creative agency of record reflecting a fresh focus on data-driven marketing and a move away from traditional advertising agencies.
  • PwC made waves in 2016 when they appointed their first Chief Creative Officer. It should be noted that PwC also named a Chief Purpose Officer, which seems very much like an agency-thing-to-do.
  • Omnicom created Hearts & Science, an integrated digital agency leveraging technology to scale customer relationships. It has attracted Proctor & Gamble and AT&T as clients.
  • Razorfish, a division of Publicis Groupe, partnered with Adobe to build its own digital marketing platform.
  • Starcom MediaVest Group launched marketing consulting brand Zero Dot and sibling Zenith soft-launched a media-focused consultancy called Apex.
  • R/GA and GroupM now offer broad-based consulting services for the purposes of higher margins while securing traditional ad business. This is the strategy of O&M’s strategy consultancy, Ogilvy Red. Carla Hendra, global chairman of Ogilvy Red, is quoted as saying, “If we sell $1 of consulting work, down the road it can lead to $3 to $4 dollars of communications work.”

Clearly, traditional lines are crossing and blurring but why?

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