Moment to moment marketing
The power of email marketing…
Barneys case study

By Arianne Cohen, Fast Company

28 Apr 08
As far as e-commerce has come, it still remains in its infancy. A glance in any spam folder is proof positive that online retailers haven't yet refined their customer tracking. To wit: My spam box currently features Petco.com [advertisements for kitty litter (I'm a dog person), a Staples.com ad for Windows software (I'm a Mac girl), and four ads for Viagra (enough said).

But the emails from Barneys.com are different. Barneys knows that I like jewelry and yoga. My most recent Barneys email read, "Love it! Jennifer Meyer Ohm Necklace." I do love it.

In the past eight months, Barneys' relationship with Sheldon Gilbert, a genetics scientist turned software impresario, has given the retailer the ability to precisely target customers in its email campaigns. Gilbert's company, Proclivity, sorts through the data left by millions of anonymous people clicking around Barneys' Web site, and predicts who's likely to buy which products, when, and at what price.

"A lot of companies throw this data out, or only use 1% of it," says Gilbert, 32. Stints at a company that built Web sites for J.Crew, Best Buy, and Martha Stewart, and later working for discount apparel retailer Bluefly.com, made him realize the wasted potential in not mining site data. He deferred grad school at NYU in genomics to pursue what became Proclivity. "Scientists understand how complex systems work," he says. "I'm a pattern hunter, so I created a system that was looking for patterns and was adaptive and self-learning."

The impact on Barneys, Proclivity's first customer, has been significant. "We used to spend $90,000 on a full-page ad in The New York Times," says Heather Kaminetsky, Barneys' director of Internet marketing. "Then with the Web site, we would send an email about, say, Lanvin handbags to 100,000 customers. But 90,000 of them probably didn't even know what a Lanvin handbag was." Today, only those people Barneys has identified as handbag fanatics get an email, and Barneys has seen up to a tenfold rise in response rates.

Kaminetsky can target customers based on their overall habits, such as "fashionistas" who buy risky new designer products, "bottom feeders" who always buy sale items, or cosmetics zealots. "We know when you're gonna run out of shampoo, so we might as well send you an email," she says. So she does. Rather than feeling spied on, customers are thrilled, because the message is relevant. Who wouldn't want a reminder that it's time to get more shampoo?

Barneys was skeptical about Proclivity when Gilbert approached the company in the summer of 2007. "When a vendor comes to you using all those words -- 'integration,' 'low-tech,' 'turnkey solution' -- it's scary," says Larry Promisel, VP of e-commerce at Barneys.

He is bombarded by sales pitches from similar companies, many of which track basic customer patterns. But Proclivity's software brought all of the information together, and took the further step of predicting customer behavior. "We tried to trip up their system," Promisel says.

"Sheldon would suggest which designers would be big for us, and we'd separately make our own judgment based on the store. And he was right." Once the firm was hired, Proclivity spent two months collecting data -- letting the computer model learn (the early predictions were sometimes less than accurate) -- and another four months testing. "We had to teach them a bit about luxury retail. They butchered the names of our designers," Promisel chuckles, citing Dolce & Gabbana and Manolo Blahnik as victims.

The Proclivity analysis has born unexpected results. Barneys now knows what time people like to buy (lunchtime) and which products are likely to sell well in pairs (handbags and wallets). And based on Proclivity's feedback,

Barneys also redesigned its e-campaign formats. Unlike the kind that cram in 5 to 12 products ("Spring Tie Sale!"), a typical Barneys email sticks with one product from one designer: "Manolo Blahnik: Pretty in Pink" features an image of a sparkling pink high heel on a pedestal. That's it.

Negative supermarket
ad row escalates

Online Ocado wins round one v Tesco?
 
23 Mar 08
The increasingly bitter war of words between Tesco and online rival Ocado has escalated - with the UK's largest supermarket threatening to complain to the Advertising Standards Authority about Ocado's latest advertising campaign.

The complaint follows claims by Ocado that it would match Tesco's prices on "all household brands". In adverts published in national newspapers earlier this week, Ocado vowed to match Tesco on 3,500 branded products - from Pampers to Coca-Cola. The pledge is part of a wider plan by Ocado to attract thousands more customers over the coming months.

A Tesco spokesman said: "We are delighted that Ocado sees Tesco.com as the benchmark for low prices, but if they promise their customers that they are going to match us on price, they owe it to them to at least try. These independent figures appear to show that their claims are nothing more than a marketing gimmick."

Tim Steiner, chief executive of Ocado, said: "We are confident that we have matched over 4,000 items this week. We will match as many Tesco prices as we can and we will change our prices 52 times a year. If they send us a list of products we haven't yet matched, we will match them. I would be delighted to go to the ASA and explain our policy - we believe it is very transparent."

The row is the latest in a series between Tesco and Ocado. Sir Terry Leahy, chief executive of Tesco, once described Ocado as a charity, given the estimated £300m loss the business has incurred.

Steiner said: "We have a reputation for superior service and excellent quality, but we have been perceived as too expensive and out of the reach of many households. This will no longer be the case."

It is thought that Ocado will have to invest about £10 million to keep its price pledge. The group, which supplies Waitrose food and drink alongside everyday branded products, claims to be making a profit at an operating level but is thought to have made a pre-tax loss of £30 million in 2007. Tesco posted a pre-tax profit of £2.6 billion last year.

Richard Hyman, managing director of Verdict, the retail consultancy, said: "Whether it's suicidal or not is hard to say, but this could potentially be quite damaging for Ocado. "People aren't going to switch to Ocado because they have Fairy Liquid at a lower price. If you're worried about price, you'd go to Tesco. I think it's a very bold move."

Ocado has built up a loyal customer base in the South of England through its partnership with the John Lewis-owned Waitrose and a focus on having the best customer service in the market. It claims to hold a 50 per cent share of the lucrative grocery home-shopping market in London.

 Its founders - Tim Steiner, Jason Gissing and Jonathan Faiman - have invested heavily in a state-of-the-art, automated warehouse in Hatfield, Hertfordshire, with the help of investors such as John Lewis and Jorn Rausing, the Tetra Pak billionaire.

Gissing said yesterday that the price-match campaign was designed to change the perception of Ocado as an expensive retailer. He said: "We thought the best way to demonstrate clear, transparent price competitiveness is to match Tesco prices for all branded goods stuff we sell. It will cost several million pounds, but we can absolutely afford it.

"The business is flying and customers have told us if they can buy Pampers from us at Tesco prices and Waitrose ready meals at Waitrose prices, then we have a shop they will truly love."

Gissing added that Ocado regarded Tesco's consistent sniping as a badge of honour. He said: "I remember Richard Branson saying that when he was being targeted by British Airways he was terrified but thought, 'I must be doing something right.'

"Tesco is the biggest and the best, but when they say things like 'Don't shop at Ocado, shop at Tesco', you think: 'OK, I'm having my BA moment here'. When your largest competitor is focusing on you, you think: 'I'm on to something here.'"

The report in today's Sunday Times suggests the Ocado campaign was successful with record sales of £7m ($14m) last week.

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Celebrity ads
boost Morrisons

Street Market 'freshness' approach
wins market share gains v Tesco

Market share boosted
It has emerged that Morrisons has significantly boosted its market share after outspending Tesco, and the other leading supermarkets, on advertising during the Christmas period. Morrisons splashed out £29m on ads in the fourth quarter of 2007, some £2m more than Tesco and nearly a third more than Asda and Sainsbury's, according to Nielsen Media Research.

This investment appears to have paid off. Morrisons has seen its market share power ahead to 11.6% in the 12 weeks to February 24th, up 0.5%/point compared to the same period last year, according to TNS Worldpanel. The chain says it has gained an extra 500,000 shoppers a week. By contrast, Tesco's market share slipped to 30.9%, down from 31.3% last time.

Edward Garner of TNS says Morrisons has taken market share "across the board" although he believes it has come from "Tesco more than most". One insider disagrees, saying switching data suggests Sainsbury's and Asda have lost more shoppers to Morrisons than Tesco. However, Sainsbury's lost just 0.1 percentage point of share in the period and Asda held steady.

Morrisons' £450m store and marketing make-over, announced last year by new chief executive Marc Bolland, a former Heineken marketer, has helped transform perceptions of the chain, especially in the South and Scotland. As Bolland says: "This campaign told customers things they did not know about Morrisons, and they liked what they heard. We welcomed many new customers into our stores at the end of the year as a result and, importantly, they kept coming back."

When Morrisons acquired Safeway in 2004 and converted its stores to its own fascia, traditional Safeway customers, especially in the south, stayed away in droves from the rebranded stores. The refurbishments introduced a "market street" concept, which attempts to re-create the lively atmosphere of a street market within the store through a maze of stalls selling fresh fish, bread and meat counters interspersed among fresh fruit and vegetable stands. The celebrity ad campaign which launched last summer, created by Delaney Lund Knox Warren, invited many of those former Safeway shoppers to give Morrisons a shot.

"It's a very simple advertising story," says DLKW chief executive Mark Lund. "People outside the heartland of the North didn't know the Morrisons story and maybe resented the chain because it had taken over Safeway, which was a brand they did know and quite liked.

The advertising says simply that Morrisons makes and prepares more fresh food in-store than any other supermarket. It is classic advertising – if people don't know the brand's story and you can do ads that are engaging and people like what they see, they will come back for more."

The celebrities were selected as people with a reputation for demanding quality, he adds. But he plays down the idea that Morrisons' share boost has come from outspending the competition on ads. "Marketing experts say you need a 10% increase in share of voice to get a 1% increase in market share. We spent a bit more than Tesco but gained rather more market share."

In its full year results for 2007 published last week, Morrisons revealed profits had almost doubled to £612m on sales up 6% to £13bn while like-for-like sales, excluding petrol, increased 4.6%. Tesco managed 3.6% like-for-like growth over Christmas. The results were the swansong for chairman Ken Morrison, who steps down after 55 years building the chain.

Freshness first and foremost
A rival advertising source says the Morrisons ads have cleverly made a generic statement about freshness – something all supermarkets claim – into its own property. This is reminiscent of Heineken's attempt to "own" the notion of "refreshment" in its "refreshes the parts other beers do not reach" campaigns of the Seventies.

The source says: "It reeks of somebody coming in and re-engineering the marketing from inside out. I wouldn't say the Morrisons recovery is advertising led, but you could say all the different elements have been cleverly cemented together by the ads."He says the ads are derivative of the Marks & Spencer celebrity campaign, although Lund says: "M&S is using models as mannequins, they don't speak and they don't express an opinion. Morrisons is about people expressing a very firm opinion about what they want."

According to Morrisons marketing director Angus Maciver, brought in from Prudential by Bolland in November last year, the chain has managed to dominate perceptions of freshness. Researchers put the statement to shoppers: "They source, produce and prepare a lot of their own fresh food". While 18% of respondents agreed this was true of Morrisons in June, by November – after the campaign had broken – this had rocketed to 45%, far above the figure for supermarket rivals. Maciver reveals a new direction for the advertising. "For the future, expect us to do more to communicate our provenance message," he says. The chain is expected to highlight its British produce.

One fortuitous factor that could work in Morrisons' favour is its low proportion of non-food sales compared to rivals. This has helped in its quest to become a specialist food retailer and means it will be less exposed to the downturn in retail spending. Its positioning as the "food specialist for everyone" is similar to the Marks & Spencer "exclusively for everyone" tag that was ditched in favour of "Your M&S".

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Names that shame
Product Test puts Siana Anti-Wrinkle Day Cream from Aldi as one of the best moisturisers

2 March 08

I thought you's all like to read Carol Midgley's Bargain hunter piece in The Times excellent Saturday Magazine yesterday. "A while ago, an executive at this newspaper came up from London to visit me in Liverpool and was appalled when he saw the name of the tobacconist's where I suggested he buy his Marlboros. "I'm sorry but I'm just not setting foot in a shop called Supercigs," he said. And though I enjoyed taking the mick out of his fancy southern ways, the truth is I can't really blame him.

"We're all seduced by nice packaging, just as we're turned off by a pig ugly-sounding brand. (Any advance on Anusol as the world's least lovely product name?) Where would you feel better about buying wine – the upwardly mobile Bottoms Up! where I used to go in Fulham, or Boozebuster up north? Exactly. So I'll be honest and say that I don't know many people who shop regularly at Aldi. They might go in for the odd thing but as my friend says, she doesn't really want Aldi's brand names on show in her cupboards in case "people think I'm a povo". And a small, shameful part of me agrees.

"It's all change of course now that Aldi's £1.89 Siana Anti-Wrinkle Day Cream has been voted one of the best moisturisers on the market in a blind product test, as we reported last week. People, me included, are now racing into Aldi like rats up drainpipes to bag their cheapo facelift. Actually I did reserve some scepticism. Last year I got sucked into that "miracle" Boots No7 Protect & Perfect frenzy after scientists declared that, yes, it really did rejuvenate skin. But I've been using the stuff since November and, alas, you could still mistake the lines on my face for a map of Venice.

"But this Siana furore has been a blessing because it's forced me to go in and see Aldi afresh. There's no point pretending that shopping here is an aspirational experience. In my local store you can find the power drills nestling up to the pillows, the Easter eggs alongside the WD-40. There aren't 25 choices of live yoghurt and you'd probably best look elsewhere for your alfalfa. But it's only when you walk out with groaning (3p) carrier bags and see you still have change from a tenner that you realise how dirt cheap it is.

"I found the Siana cream not far from the pet food (obviously), got it home, then realised I didn't know whether it's tested on animals. So I spent 100 years (well, a couple of days) trying to get through to Aldi while a recorded message told me my call was important before a nice lady answered and said she didn't know. She passed me on to someone else who also didn't but conferred with someone else and, apparently, no, it isn't. Praise be.

Aldi's boast is that it keeps frills to a minimum so it can offer low prices. So maybe the price of £1.89 anti-wrinkle cream is that you age three years waiting for someone to pick up the phone."
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Extract from New York Times article by Ruth La Ferla

STEPHANIE LaCAVA has glimpsed fashion's future, and she likes what she sees. "I've really been into this kind of sculptured feminine silhouette," said Ms. LaCava, 24, a features associate at Vogue. To judge by the outfit she wore at the Winter Antiques Show in Manhattan last week — a sedate cream-colored sheath that Letitia Baldrige would have admired — Ms. LaCava has embraced the fashions of the Kennedy years without irony.

"I like the idea of good tailoring and clothes that are not so demonstrative," she said. "We're getting beyond the idea of 'look at me, look at me.' Fashion today is more about calmness than flash." That assertion puts her in fine company. Some of Seventh Avenue's most influential tastemakers are invoking in their latest collections the proprieties, the seamless appearances and the tony aspirations of midcentury Middle America. They are, in short, going bourgeois to the core.

"That moment resonates with a lot of people and how they want to live," said Michael Kors, whose recent runway show catered to the fantasy. "There is not a minidress to be found, not a platform shoe in sight. And 'suit' is not going to be a dirty word." His show and others' are expected to pay homage to a period, the late '50s and early '60s, that was, in retrospect, an interlude of prosperity and stability, one enriched by material comforts as substantial as a Steuben crystal cocktail shaker.

The past — in fashion and elsewhere — seems to call strongly to the present, as the country grows nervous about a possible recession and a diminished role on the world stage, even as Americans seek optimism through their presidential candidates.

"We have certainly reached the time where people want to feel good again, to go back to Camelot and pre-Camelot days," said Marshal Cohen, chief retail analyst with the NPD Group, a market research firm. "Boomers especially are harkening back to a day before there were issues," among them global warming and teenagers overdosing on prescription drugs.

Around the same time, hints of an infatuation with the era emerged on the runways. In a collection Miuccia Prada offered for "pre-spring," which arrived in stores late last year, she trotted out bouffant skirts that cinched the waist and grazed the calves. Frida Giannini of Gucci has reissued the bandeau brassiere, that late-'50s staple, and Dolce & Gabbana is offering poppy-patterned circle skirts.

Marc Jacobs incorporated vintage-style bras and corsets into the designs he paraded in his New York show for spring. Last month Barneys New York displayed highly structured, satin-panel girdles and bras by Fifi Chachnil in its lingerie department.

The January British Vogue similarly featured circle skirts, peep-toe sandals, gingham bandeau tops and a shrug — the term itself a throwback to the days of kitten-heel pumps and fin-tail sedans. Just days ago, in a pre-fall collection for Louis Vuitton shown in Paris, Mr. Jacobs endorsed the type of matched wool skirt suit that used to be favored by young matrons in Darien, Conn., a look Babe Paley would have loved. Its immaculate tailoring and restraint was echoed in Mr. Jacobs's New York show.

Unlike previous portrayals of the late '50s and early '60s as a time of unalloyed optimism, fashion's latest embrace of the past appears to reflect the nation's darkening mood.

"It is the fashion equivalent of comfort food — I think we need it," said Sam Shahid, an art director whose clients include Abercrombie & Fitch. "Even in photography, everything we're seeing has a classicism about it," he added. "Things are timeless right now, or you want them to be."

Risk averse design?
But some style watchers bemoan such conservative attitudes, arguing that they represent a creative retreat. "Fashion is supposed to be about change," Mr. Cohen said. "Fashion is risk. But as profits increasingly rule the roost, that risk has disappeared." The paradox is not lost on him. Once a standard-bearer of the vanguard, "fashion has become the most conservative of all industries," he sai

Designers seem intent on returning to old-fashioned civilities just the same. Some view the resurrection of a more formally controlled aesthetic as a rebuke to young Hollywood's disheveled style. Thakoon Panichgul, who will show a collection of body-skimming dresses with subtle '60s details, maintains that such looks are timely. "There is an energy about being proper," he said. "It's not about wholesomeness, it's about respectability, about having manners again."

24 Feb 08
THE gown was almost wanton — fluid but curvy with a neckline that plummeted dangerously. "It makes me feel sexy and beautiful," said Natasha DaSilva, who slipped it on for a fitting last week. Cut away at the rear to reveal a tattoo at the small of her back, the dress suggested a languorous night in the honeymoon suite.

Except that Ms. DaSilva, who will be married on Long Island in September, plans to wear it at the altar. "Why not?" she asked. "I want to look back in 20 years and feel like I looked hot on my wedding day."

Ms. DaSilva, 26, thinks of herself as adventurous, but not so brash that she is about to cross a line. Dressing for a wedding as if it were an after-party is accepted among her family and friends. "For my generation, looking like a virgin when you marry is completely unappealing, boring even," she said. "Who cares about that part anymore?"

"Brides today absolutely want to look sexy and glamorous," said Mara Urshel, an owner and the president of Kleinfeld, the venerable Manhattan bridal salon. In recent months, the store has seen a spike in demand for plunging necklines and negligee looks, one that has only intensified since the spring bridal collections began arriving in stores. For brides shopping now for gowns to wear at summer or early fall weddings, "there is a lot of freedom of choice, and these girls exercise every bit of it," Ms. Urshel said.

"Young women increasingly look to the red carpet for style ideas," said Millie Martini Bratten, the editor in chief of Brides magazine. "They are very aware of how they look," she added. "They diet, they work out. And when they marry, they want to be the celebrity of their own event."

To accommodate them, the once rigidly corseted bridal industry has loosened its stays. At the spring bridal shows in New York last October, tastemakers like Vera Wang, Oscar de la Renta, Reem Acra, Angel Sanchez and Carolina Herrera unveiled a preponderance of strapless styles, trumpet shapes and even a few above-the-knee looks. More-daring designers offered filmy peignoir dresses, two-piece looks and skirts slit all the way to the hip.

Some of these va-voom confections seem tailor-made for the bride who envisions the march down the aisle as a long-dreamed-of photo op, and the reception as an after-party on the scale of Oscars night.  "Women now are looking at their weddings more like a movie premiere," said Jose Dias, a designer for Sarah Danielle, a New York bridal house.

These steamy fantasies extend to their choice of location. "It used to be that unless you married at home, you were married in a church," Ms. Bratten said. But today fewer weddings take place in a house of worship, and fewer still in the bride's hometown.

According to a 2006 survey by Condé Nast Bridal Media, 16 percent of couples choose a destination wedding — a fourfold increase from a decade ago. The same survey found that only 46 percent of brides are married in a church or synagogue, down from 55 percent the year before. With weddings transported to other locales comes a loosening of conventions. Whether they marry in a walled garden, on a tennis court, on a yacht or at the beach, "brides are more focused on the after-party, and on personalizing it," Ms. Bratten said.

Beginning with the gown. Today the prevailing fantasy is no longer, " 'I want to be a princess in my ball gown,' " Mr. Dias said. "A lot of women have done that already for their prom."  Mr. Dias, who is based in Los Angeles, accommodates clients' desires for dresses that echo runway trends with halter-tops and off-the-shoulder gowns that are more emphatically provocative than the strapless looks that have become commonplace. His dresses are cut to appeal to the bride who is "confident in her sexuality," he said.

Similar considerations prompted the designer Monique Lhuillier, a favorite in Hollywood, to fashion a dress with an Empire bodice, wide lace straps and a wispy chiffon skirt — features more often found in a nightgown. A hit of Ms. Lhuillier's spring bridal collection, the dress is available at Kleinfeld.

For brides who want to maintain the traditional modesty during the wedding ceremony but cut loose at the reception, there is the increasingly popular option of topping the dress with a shawl, stole or bolero.

At a second marriage ceremony later that week on a beach in Acapulco, Ms. Pasquel thought only of pleasing herself. Inspired by a trip to India, she wore a tiny midriff-baring bodice and an abundant skirt made of gold leaf. More sensuous than brazen, it made an impression, she recalled. "People talked about it — a lot."

Catherine Cuddy, an insurance analyst in New Jersey, was similarly focused on turning heads when she married in Bryant Park in New York last October. She dispensed with the customary long, fitted sleeves and train in favor of a halter style that dipped to the small of her back.  Even a veil was too much for her. "I didn't want to cover up my dress," said Ms. Cuddy, 33, a self-described Rita Hayworth type. Or the torrents of curls that rushed past her shoulders. Or, for that matter, her gym-toned back.

To get in shape for her gown, a white lace sheath that appeared to have been turned on a lathe, she stepped up visits with her trainer from one to three sessions a week. Ms. Cuddy had no thought of defying tradition or making a statement of any kind. She simply wanted to make the most of her curves, she said.

When she marries in Long Island City next fall, Ms. DaSilva, too, will dress as she sees fit — and with her mother's blessing. "My mom loves my gown," she said delightedly. "She thinks it's very figure-flattering." Would her male relatives object? "Oh, no, no, no," Ms. DaSilva said. "Besides, in my family, we're mostly women. It's pretty much — we're in control."

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23 Feb 08

Interesting article in the NY Times today by Chandler Burr about latest developments in the perfume industry. The new scent is reminiscent of a mixture of a just-picked apple and a rose in its prime. But to the Takasago International Corporation, which manufactures this synthetic material, it smells even sweeter.

Last year, that chemical, with the trade name Thesaron, became an essential ingredient in a new perfume, Silver Shadow Altitude, released by Davidoff,