Marketing Without Advertising

Reason to get the 6th edition

The 5th edition of Marketing Without Advertising is now free online in many sites.   

The current edition on the market is the 6th edition for $13.60 from Amazon and $11.99 in the Kindle version.

The 6th edition has a heavy focus on building your business with the Internet.  Almost every business needs to be current on the Internet.    

This blog also keeps current with Internet and other marketing developments. 

 

Beautiful interior retail design

If you want to see beautiful interior retail design look at Starbucks in Japan.

Japanese marketing genius

GU’s fashionable flash mobs and other guerilla promos

Written by: William on May 24, 2013 at 3:00 pm | In LIFESTYLE | No Comments 

GU (pronounced “gee-you” — a play on jiyu, meaning “free”) is the off-shoot of UNIQLO that is even cheaper and even more casual.

GU branches have been popping up around major city centers recently and as part of its expansion, it has launched a series of guerilla marketing schemes to pull in the crowds.

These include flash mob events, fashion shows with “living” show window mannequins, and more. It was also one of the sponsors of the Kawaii!! Matsuri 2013, which prominently featured GU’s official model, Kyary Pamyu Pamyu.

Since GU’s line is meant to be clothes worn by laidback fun-loving youngsters, in Kobe it decided to hold a “fashion dance battle” with teams of kids.

Meanwhile, in Hakata (Fukuoka), it held a flash mob event. Flash mobs have been taking place a lot in Japan recently, both as genuine social “happenings” and also as promo events.

Meanwhile, in Ikebukuro in Tokyo and Shinsaibashi in Osaka, the GU held a live fashion show in its shop window, and broadcast on Ustream. Check out the three super genki foreign models, who are meant to be “living” mannequins.

GU opened its two hundredth store in late December and is set next to move overseas. It also changed its branding logo from “g.u.” to “GU”, which it hopes will help it stand out more when it expands beyond Japan.

Churn and growth

Most businesses have a steady stream of new customers replacing customers who left. That replacement is called churn.

In some instances that churn is nearly 100% as is the case with much retail and restaurant business. In other instances there is very little churn as is the case with telephone contracts, utilities and accounting firms.

Businesses such as banks, department stores, shopping centers and coffee shops are in the middle with churn as a definable reality of business.

In my first post-college job, starting the marketing research department for the Bank of America, I noticed that churn for this largest California statewide bank was very high. Nearly 1/3 of customers  opened and closed accounts every year.

I pointed out to management that simply reducing the number of customers leaving or finding a way to get them to return to the bank would be a major source of customer growth. Management had no interest because most of the churn was in retail customers and only corporate customers were considered important.

For most of my clients, over the past 40 years, retaining customers became the most important source of growth.  That is why Marketing without Advertising puts so much emphasis on helping customers explain their problems to the business management before they leave and giving them vast recourse opportunities if anything goes wrong. Don’t let them leave because of dissatisfaction, if possible.

Think about how fast your business could grow if the number of customers leaving were cut in half. In this era of Internet business it should be even easier to reduce churn.

Retail ice cream and coffee

There are two retail stores that I want to call to your attention.

The first is in San Francisco and is an ice cream soda shop called The Ice Cream Bar

As is true all over San Francisco, there is a wide variety of unusual ice creams at this store. What makes this retail outlets so unique is the bar at the back which is stocked with an arsenal of tinctures and syrups. The mixologist does what ice cream bars in old fashion drugstores used to do.

Before refrigeration was cheap and ubiquitous, the way a cold drink was made was to drop acid phosphate into soda water to create a bubbling, refreshing drink. All sorts of tinctures such as oil of lemon are put into the phosphate drink. Coca-Cola was originally a phosphate drink. Ask at The Ice Cream Bar and have one made for you.... make it a float too.

This is a wonderful store that lets you understand why drugstores were the home of soda fountains and ice cream.

It is a brilliant business, the kind that San Francisco is so prolific in creating.  San Francisco had already created the modern world of mixed drinks as a response to the perverted alcohol laws that treated the Japanese shochu as a wine (described in an earlier blog).

There is a new retail outlet in Venice Beach California that is equally innovative and representative of the kind of businesses generated on the Westside of Los Angeles.

It is called Deus ex Machina.  I will not say what that Latin phrase means to my sophisticated readers. The shop is a motorcycle coffee bar that also sells motorcycle accessories and has a motorcycle repair shop in the rear. The espresso is good.

Deus ex Machina is a slow development that took many years to come to fruition as an idea. Espresso entered our American daily lives 20 years ago with Starbucks. Starbucks entered the market at the top of the status ladder by carrying the New York Times and jazz. Deus ex Machina is here to show us that real style is at the bottom of the status ladder among motorcycle fans.

Of course this is America, where status has always been treated as a joke and this retail outlet is the perfect ironic joke. It is beautiful and well designed, just like a motorcycle.

Products and provenance

I recently had my expensive sushi experience.

The sushi chef is not the one who has a movie made about him and operates a sushiya with 10 seats and three Michelin stars. That shop is near Ginza.  Meals there are $400 per person.

My sushi chef has a 12 seat restaurant and the meals are only $200 per person. This sushi of course is extraordinary. This shop is in Shimbashi. This chef was awarded last year’s top Japan sushi chef award.

The reason I bring this to your attention is because Mr.Nagayama, Katsu does something that I considered to be the act of a marketing genius.

Every evening there is a large piece of rice paper on the wall with the name of the seafood to be served in the top column, followed by a description of how the food was caught, in detail whether net or long line or hook, as well as the wholesale supplier and the locale of origin either a town or a segment of ocean. One piece of the tuna came from a fish caught off of Ireland.

I call this document the Provenance of the food.  there are many other types of business that could display such a document of provenance from fancy American restaurants to shoe stores. It is a brilliant way to connect customers to their products.

Chef Nagayama happens to write his providence document with an extremely beautiful calligraphic hand. I don’t expect that from anyone else.

Online new businesses

The attached photo is a tiny shop in Tokyo.

The product is not clearly visible in the photo. You can buy a bottle of champagne or a glass slipper with champagne that is sandblasted with the message you want. Messages such as happy new year, happy birthday and congratulations with the name of the recipient or photo.

This is an excellent business for the Internet.

The problem is showing good demonstrations in retail outlets.

I think the solution is a standalone poster with a sample in front of it and an order address for the online URL and the agreement
to pay a commission to the retail store.

Insurance company error

This is a happy blog.  

My homeowner’s insurance company, CIG, made a mistake and deducted the same monthly fee twice. The company immediately put one charge back in my account.  I never noticed until two weeks later, while reconciling the account.

The company sent a letter of apology offering to pay any expenses that had been incurred by the mistake and enclosed a $10 Starbucks card.

Good recovery from an inadvertent mistake.  I call that recourse in my marketing book. All businesses make mistakes, how they handle them is the measure of competence.

I love it in Vietnamese

Here is an article in Vietnamese that is from an early article I wrote on Marketing Without Advertising.  I hope your Vietnamese is good or your translating software is workable.  This is the first paragraph of a 3,000 word article.

Ngày nay, sự trung thực có lịch sử 2.000 năm tuổi này được phản ánh qua nhiều chi tiết: các nhà hàng bày mẫu thức ăn trong tủ kính trước cửa và báo giá bằng số tròn bao gồm thuế và tiền boa bán hàng. Nếu bạn nhìn thấy một món ăn đề giá 800 yên thì đó là tổng giá bạn phải trả.

The image came from the article.

Counter-selling

One of the most powerful tool in sales is counter-selling. It is the implication that your potential purchase is either over-the-top or is going to exceed your expectations.

Counter selling takes these two forms. I once asked a salesman if the glue on a hook I was about to buy for the shower would be strong enough. His reply was "if you are renting, you had better get your landlord's approval for this hook.... it might be too hard to get off the tile.'

A friend of mine was about to buy a mink stole for his new girl friend at Saks. He asked the sales woman 'would you be impressed with this stole as a present?' 'Frankly, with the combination of the Saks wrapping and the lushness of the fur, I would worry that you are too interested in me.'

Retail marketing architecture

 We think of architecture as a form of marketing.  It can tell the potential customer something about the company and about the likely buying experience.

I saw an example in the Ginza where the relationship between architecture, marketing and retailing were stronger than I had imagined possible.

This store is on the main Ginza street with highend retailers next to each other endlessly in every direction.  The entrance area is open.  There are about five circular glass pods, with jewelery like displays of watches in each.  When you walk into any glass pod and talk to the sales person standing there, you learn that the pod is an hydraulic lift that will take you up to the floor above with a complete assortment of the watches on display from that manufacturer.

 It is your personal elevator to the showroom of the company that is on display in the pod.