Yesterday, my husband and I attended the Grand Opening of Kohl’s Department Store in Bend, Oregon. You would have never guessed that our community is experiencing a 14% unemployment rate. The aisles were packed, and so were the shopping carts that kept bumping into us.
All across the country, retailers are helping to pull us out of this economic funk. For those of us in the B2B universe, we can learn alot from their recovery strategies.
Here’s some additional encouraging news:
1. The retail sector is reporting positive results. Home Depot and Macy’s beat earnings expectations as of late February. Lowe’s net profit rose 27 percent in fiscal 2009 fourth quarter earnings. Chief Executive Robert A. Niblock told The Wall Street Journal “the worst of the economic cycle is likely behind us.” Nordstrom’s Q4 income more than doubled. Target’s Q4 profit jumped 54%.
2. Innovative online marketing is beginning to show more consistent ROI for small businesses–especially those selling daily essentials. It’s easy for a $140M company such as Seventh Generation to invest six figures in social media and cause marketing. It’s an entirely other thing to see $1M businesses report 30% revenue increases from those efforts. Witness Joe Sorge, the co-owner of A.J. Bombers, a burger restaurant in Milwaukee, Wisconsin. In partnership with FourSquare, he has seen menu item sales grow by approximately 30% since launching a mobile promotions service. FourSquare, based in New York, mixes social and online gaming features to encourage people to explore the cities in which they live.
3. Modest price increases are keeping inflation at bay. According to William Dudley, the president of the Federal Reserve Bank of New York, “There is just no inflation pressure in the U.S., so our focus has to be on growth and jobs.” (source: Wall Street Journal, February 20, 2010). This provides impetus for the Federal Reserve to keep interest rates low, which is easing credit and encouraging us to shop again.
As a B2B business leader, how can you capitalize on these trends?
* Find a low-cost way to experiment with inbound marketing strategies. Consider launching a campaign using FourSquare, LivingSocial, BuyWithMe, Groupon, or IMshopping. If your organization is unable to leverage these technologies, then at least learn the basics. Get a copy of Inbound Marketing by Hubspot co-founders Brian Halligan and Rahmesh Shah.
* Establish cost-effective ways to inspire your teams to innovate and delight customers. The Kohl’s cosmetics clerk saw us standing in a long checkout line, walked 25 yards out of her way, and invited us to check out at her station. If you are short on noncash reward ideas, just visit Zappos’ website for inspiration. They have mastered the art of creating fun and playful work environments. You will want to exhaust every reasonable strategy to retain your best people when the economy rebound accelerates.
* Think like a retailer and stop only comparing your programs to your peers and competitors. Study how Target has become a brand powerhouse by aligning with leading home goods and fashion designers. Search for articles on how they have restored customer confidence. Apply their lessons. It doesn’t matter whether you are a software developer or a CPA. You will gain strategic momentum by studying innovations outside your industry.
The recovery rests in the hands of the client-centric and the innovative. By embracing new ways to delight your customers and create new markets, you will be hosting your own Grand Opening in no time.