This ‘marriage’ makes no sense to me. Dell has long been using kiosks in airports and some of the better malls. This would indicate to me they are looking for the upscale customer; one that is not shopping just on price. Then, they decide to join with Wal-Mart. Are we to expect that the person we are talking with in Wal-Mart is a Dell employee that knows computers? Or might this person be the individual that was working in the snack bar about 30 minutes earlier? I don’t think I want this person handling my computer.

The only thing I can compare this to is Starbucks allowing other businesses to open a ‘Starbucks’ within their business. Businesses open a ‘Starbucks’ that looks like a ‘Starbucks’, sells ‘Starbucks’, but doesn’t take the Starbucks cards or have employees that are educated in the Starbucks culture. The customer service is horrible (try ordering a Starbucks drink in an airport ‘Starbucks’ operated by Hudson News).

Hey Dell, take a less from the mistake made by Starbucks. Figure out who your customer is and don’t try to be everywhere at any cost.

Dell and Wal-Mart test tech services

By Jonathan Birchall in New York and Kevin Allison in San Francisco

Published: July 16 2008 22:41 | Last updated: July 16 2008 22:41

Dell, the personal computer maker, has launched a pilot scheme with Wal-Mart to provide home installation and repair services, mimicing the successful Geek Squad operation of rival electronics retailer, Best Buy.

The move follows Dell’s decision to start selling its desktop computers through retailers including Wal-Mart last year, ending over two decades of dependence on the direct sales on which it built its business.

Wal-Mart says it is opening 15 “Solution Centers by Dell” at stores in the Dallas area, which it says will provide home set-up services for high-definition TVs and home theatre installations, as well as computer repair and advice on wireless technology.

The retailer said in a statement it currently had no plans to expand the pilot, which it said would provide “an opportunity for us to understand more about what our customers need and expect in home installation and technology services, within a specific market”.

For Wal-Mart the move reinforces its push into selling higher-end consumer electronics, such as large flat screen TVs, which frequently require professional installation. Over the past two years, it has also introduced more leading brands into its stores, and started selling extended product service warranties, designed to encourage bigger-ticket sales.

The sale of both services and warranties have been an important source of revenues for retailers in the low margin electronics business. Circuit City, the third largest US electronics retailer, said its Firedog installation service had revenues of $269m last year, while warranties and services together provided $825m in revenues, or 7 per cent of the $11bn total.

Wal-Mart’s started aggressively expanding its consumer electronics offering almost two years ago, launching a wave of price-cuts on flat screen televisions which significantly increased pressure on its rivals. CompUSA stopped trading earlier this year, while Circuit City, whose shares have collapsed over the past year, has put itself up for sale.

The Wal-Mart/Dell pilot’s servicces are priced below Best Buy’s Geek Squad, charging, for instance, $29 or $99 at home for the estimated 20 minutes needed to install computer memory in store, against the Geek Squad’s comparable $39 and $139.

Copyright The Financial Times Limited 2008

Just yesterday, I posted a video I had done about Dairy Queen and franchising in general. Later on I came across this article from a retail news feed I subscribe to. In the article, Dairy Queen’s chief brand officer, Michael Keller, talks about building a brand. Its interesting to see that what I noticed locally, is being addressed nationally. Read the article below from the St. Cloud Times to see their take on it.

How to build a brand: Lessons from a Dairy Queen executive
Teens learn skills at Minnesota Business Venture

July 16, 2008

By Amy Trang

Michael Keller was on track to become a doctor when he was a freshman at Dartmouth College in New Hampshire.

That is, before a tough organic chemistry course detoured his route.

Keller, chief brand officer for Dairy Queen in Minneapolis, put his efforts toward psychology and eventually a master of business administration.

“I had no clue I had a marketing career ahead of me,” Keller said.

Keller spoke to almost 177 Minnesota teenagers Tuesday at St. Cloud State University about his career path and the branding behind one of the oldest Minnesota fast-food companies.

The teens are participants in Minnesota Business Venture. MBV is a one-week program teaching teens about business skills and financial literacy.

“I like how he connected it with real-life experiences,” said Samantha Benning, a second-year MBV participant from Fridley. “Dairy Queen is something we all can connect with.”

Carving a niche

At 43 years old, Keller worked a number of jobs before settling into the $3 billion Dairy Queen company. He worked in marketing for food companies such as Nestle, Jamba Juice and Koo Koo Roo.

“What I love about food is it’s universal,” Keller said.

As chief brand officer, Keller oversees everything under the Dairy Queen and Orange Julius brands, including brand concept and product strategy.

“Brand building is about making a promise and delivering a promise to customers,” Keller said. “You build that on trust.”

Faced with high costs of labor and foods, Keller said it’s necessary to keep making the 68-year-old brand exciting to get customers to the chain’s 5,900 locations.

A 75-person team worked on the advertising and marketing of the company’s latest product.

“There are no accidents in ads,” Keller said. “Every word, prop, music is intentional.”

Marketing also has grown to involve a wider scope than just advertising, Keller said. Branding helps retain customer loyalty by developing good experiences with the brand, from its location to customer service to product quality, he said.

Career advice

Keller left the teenagers with the notion that they themselves are brands to employers, from appearances to skills.

“Who you are is the unique competitive advantage,” Keller said. “Yow have to know how to differentiate yourself from your peers.”

Keller drew on personal experiences to advise the students. He cited a seven-month stint at Homestore.com, a job he mostly took because of the salary, although he did not agree with the corporate culture or the company ethics.

“It was completely inconsistent with the values of me individually,” Keller said.

Keller said that the teens should listen to themselves and figure out what the values, needs and goals are for their careers.

From there, the money will follow.

“The worst mistake is doing something because someone tells you to do it,” Keller said. “At the end of the day, you must make that decision yourself.”

A few days ago I stopped by what was a Dairy Queen that recently became the Dairy Dream. I use it as an example of how franchises can go wrong and discuss the reasons a business would want to leave. Take a look and check out my other YouTube videos when you get a chance.

Recently, I visited a local FedEx Kinkos to discuss how national retailers make decisions versus how independent retailers make decisions. As small retailers we have opportunities to market to our customers in a way that mass merchants don’t, and we need to capitalize upon this fact. Grab some popcorn and watch the following video to see what I have to say.

It is never too early, or toward too young a customer, for your business to work to get their image in front of the customer. Take a look at what Sears is doing.   Tom

Sears Tries to Alter Image, Co-Opt Cool in Web Push

Traditional Retailer Partners With Facebook, MySpace, Vanessa Hudgens in Hot Pursuit of Tween Market

By Natalie Zmuda

Published: July 14, 2008

NEW YORK (AdAge.com) — The coolest digital destination for kids this fall: Sears, Roebuck & Co.

The traditional retailer known for its print catalog is taking a decidedly untraditional approach to back-to-school marketing, blanketing the online world by partnering with just about every youth-focused social, virtual and entertainment network out there — all in hot pursuit of 8- to 14-year-olds that don’t exactly see Sears as fashion forward.

Sears’ back-to-school website features Vanessa Hudgens, star of ‘High School Musical.’

“Our belief is that, particularly for this tween market, there’s a little bit of undiscovered opportunity within Sears,” said Richard Gerstein, Sears’ chief marketing officer. “Part of what … Sears needs to do is build credibility with this tween market. There are a lot of people out there that have that credibility, so we’ve partnered with them to help us do that.”

To co-opt that cred, Sears is teaming with partners such as Facebook, MySpace, Seventeen, CosmoGirl, Nickelodeon and Disney, which are creating custom content or sponsorships for the retailer, and with Addicting Games, FunBrain and Neopets, which have developed exclusive Sears games. There will also be virtual Sears boutiques, fashion shows and competitions featuring apparel for avatars within virtual environments including Zwinky, Meez, WeeMee, The N and Poptropica.

Each tie-up will serve to drive customers to Sears’ “Arrive Lounge,” a key part of the retailer’s overall “Don’t just go back. Arrive” theme for the season. The website features Vanessa Hudgens, star of “High School Musical,” as well as behind-the-scenes footage from back-to-school commercials with the actress. Sweepstakes, downloads and fashion highlights linking to Sears’ e-commerce site are also featured.

Gamble
Mr. Gerstein declined to discuss details of the retailer’s overall budget or say what media budgets are losing funding as a result of the increased focus on digital programs. “It’s definitely a much bigger element of our back-to-school program than last year,” he said. “And digital continues to grow as an element of our marketing program across our company. We invest heavily in search, digital and other programs.”

While digital can be a less expensive alternative to flashy TV campaigns, it’s still a gamble for the struggling retailer. In its most recent quarter, ended May 3, Sears Holdings, parent company of Sears and Kmart, reported a $56 million loss, as sales declined 5% compared with the same period a year ago. According to Ad Age’s 100 Leading National Advertisers report, Sears Holdings’ market share slid 0.2 points in 2007, while overall ad spending was down 1.4% to $1.6 billion.

Despite its financial troubles, Sears is being both creative and aggressive when it comes to attracting tween customers during the all-important back-to-school season, its partners said. “It’s emblematic and important because Sears is a relatively traditional marketer in some ways, and this is a really impressive, innovative program that is using all of the coolest things that Web 2.0 has to offer,” said Samantha Skey, exec VP-strategic marketing at Alloy Media & Marketing.

By creating clothing for tweens’ avatars, Ms. Skey said, Sears is further entrenching itself with those customers. The retailer is also creating the opportunity for its branded items to live well beyond the life of the campaign. For now, Mr. Gerstein said, the campaign is somewhat open-ended.

“Obviously, back to school is when we put a focus on this market,” he said. “But we’ll let our customers guide us. Where they have interest, we’d be happy to … invest.”"

Sears’ creative agency of record is Y&R, Chicago, while Whitman Hart, Chicago, handles digital. MPG, along with its Boston-based Media Contacts unit, handled media for the campaign.

There are several aspects of seeing this happen that bothers me. The first is that businesses are waiting until there is a problem before deciding to do something to get people in the door. Notice that the article talks about businesses teaming up; this sounds like power promoting to us. Power promoting is something we have been promoting for over a decade. And then the aspect of cutting prices? (See my comments of earlier today regarding Wal-Mart) This is not the time for a retailer to decide to change their image of what they want their business to me. And by dropping prices toward a new image, it is tough for a business to go back to the previous price image.

Take a look at what Business Week has to say by following this link:

Business Week: Doing Whatever Gets Them in the Door

This past week I was speaking to a group in Henderson, Nevada and the issue of a challenging economy. If more people are looking at Wal Mart because of the economy, this indicates it is definitely not appropriate for small businesses to try to target the same customer. Move to a different focus; granted there are fewer customers, but your small business does not need as many customers as it takes to make a Wal Mart viable.

Here is a link to the article that appeared on MSNBC’s website:

Weak Economy may be Wal-Mart’s strong suit

And here is a link to the presentation information from the Profits Plus website. You can even listen to a free audio presentation of Tom Shay’s topic: Your Customer doesn’t live here, anymore.

Your Customer doesn’t live here anymore! by Tom Shay

We have a new presentation available for this year. It is entitled, “If the Internet works for Amazon, why won’t it work for me?

Visit this page to see details of the presentation:

Tom Shay’s If the Internet works for Amazon, why won’t it work for me?

Visit this link to see an article about how large retail is changing their web presence:

Seattle Post Intelligencer article: Regular retail turns to Web

Take a look at this article from the Baltimore Sun about ways a small business can do something extra during the challenging economic times.

Baltimore Sun article: Stay on top of buyers’ needs and preferences

We recently added a video on You Tube describing one of the finest representatives I have ever known. This video is about the man whose photo is at the start of the vendor section of our blog.

http://www.youtube.com/watch?v=pHIfx-F6Gjw