Sunday, January 26, 2003
Friday, January 24, 2003
I've never been an enormous fan of Seth Godin as a how-to-get-it-done man but I am impressed by his ability to get the ideas churning. (i confess to yelling at his books several times with a loud 'WHAT?') Tom Peters Company offered a Purple Cows and Wow projects webinar yesterday that featured Seth and the notion has stuck with me since.
Seth Godin's Site - - - Tom Peters Site
If you are driving down a road and see hundreds of cows, they begin to blur. But if one of those cows was purple you would certainly be thinking about that purple cow. Over simplified yes, but an interesting starting point for a conversation on differentiate or die.
Certainly this principle can be applied to products and there are many good examples - take the iPod for example. There are many MP3 players out there, but the iPod is definitely a purple cow.
How does the principle apply to services? Can you have a purple cow service company without an enormous cheese factor?
Take for example Geek Squad. This is a gimmick that works because the IT industry has an accepted weirdness factor.
Could we create a purple cow in a more stoic service industry like visiting nurses?
More specifically, how does one accomplish this in a pure e-tailing environment where ideas are easily lifted and copied? Add this to the challenge of creating innovations that leapfrog the competition or keep them from creating points of parity and a desire to outthink rather than outspend. Certainly a huge chunk of cash could be spent in advertising or high-technology but are there other alternatives?
Seth Godin's Site - - - Tom Peters Site
If you are driving down a road and see hundreds of cows, they begin to blur. But if one of those cows was purple you would certainly be thinking about that purple cow. Over simplified yes, but an interesting starting point for a conversation on differentiate or die.
Certainly this principle can be applied to products and there are many good examples - take the iPod for example. There are many MP3 players out there, but the iPod is definitely a purple cow.
How does the principle apply to services? Can you have a purple cow service company without an enormous cheese factor?
Take for example Geek Squad. This is a gimmick that works because the IT industry has an accepted weirdness factor.
Could we create a purple cow in a more stoic service industry like visiting nurses?
More specifically, how does one accomplish this in a pure e-tailing environment where ideas are easily lifted and copied? Add this to the challenge of creating innovations that leapfrog the competition or keep them from creating points of parity and a desire to outthink rather than outspend. Certainly a huge chunk of cash could be spent in advertising or high-technology but are there other alternatives?
Sunday, January 19, 2003
African-Americana Attracts Collectors
By Richard Chang
NEW YORK (Reuters) - African Americans seeking to reclaim their past are turning a hobby once dominated by racist images into a cultural celebration instead, helping push prices of historical artifacts to new heights.
Documents about black slavery, politics, sports, literature and entertainment are showing up at auctions where once the only choices were mammy dolls, Aunt Jemima cookie jars, figures of boys eating watermelons, "Colored Only" signs and the like.
"Before the Civil Rights Movement many collectors were white. Most of the stuff was negative. After the movement blacks started demanding more positive images," said Larry Vincent Buster, author of "The Art and History of Black Memorabilia (Clarkson Potter, http://www.randomhouse.com/crown/clarksonpotter/).
In 1996 bookseller Wyatt Houston Day (http://www.abebooks.com/home/WHDBOOKS/) put together an annual auction of printed and manuscript African-Americana at Swann Galleries in New York (http://www.swanngalleries.com), helping to meet pent-up demand for such artifacts.
"As a rule, black memorabilia was created by whites stereotyping. There was no real venue for mainstream African-American history," he said. "I mean documents from the slave trade abolition and so forth, not to mention for lesser known authors from the Harlem Renaissance."
At the next Swann auction on Feb. 27, a graphite and crayon drawing on cardboard by folk artist Bill Traylor is estimated at $10,000 to $15,000. One of his works last sold for more than $20,000 at Sotheby's in 1997.
A 1858 poster (22 inches x 7 inches) advertising 82 slaves for sale by C.E. Girardey, one of the largest slave dealers in the South, is expected to fetch $4,000 to $6,000.
At a Swann auction in February 2001, an unpublished manuscript of a fictionalized slave narrative from around 1850 emerged. "The Bondswoman's Narrative by Hannah Crafts, a Fugitive Slave, recently Escaped from North Carolina," sold for $9,775.
A copy of Martin Luther King, Jr.'s 1964 book, "Why We Can't Wait," autographed by him "To my good friend James Farmer, ..." sold for $13,800 on Feb. 17, 2000.
At the same auction, a postcard dated July 21, 1955, from Malcolm X to "Marie Muhammad" fetched $3,680.
In the more popular arena, the Feb. 8, 1999, issue of Time magazine with hip-hop artist Lauryn Hill on the cover became a hot item after she won five Grammy Awards -- more than any other woman in history. The issue is now probably worth $150 to $500, Buster estimated.
A set of three politically correct black "Shani" dolls first sold by Mattel Inc. in July 1991 is probably worth $2,000, he said. And a 1984 Kellogg's cereal box featuring then-Miss America (news - web sites) Vanessa Williams -- which was pulled off supermarket shelves after photos of her were published in Playboy magazine, prematurely ended her reign -- could sell for $150 to $1,000, he noted.
Black Satin Collectibles, an online store, focuses only on collectibles that are "a celebration of our history," said site owner Sylvia Rosario (http://www.blacksatincollectibles.com). The site also sponsors the Black Memorabilia Collectors Club, which boasts 600 members from the United States, Britain, France, Africa and the Caribbean after being launched in 1998. Black Satin Collectibles sells the memorabilia of Josephine Baker, Dorothy Dandridge, Lena Horne, film and vintage videos and jewelry. They also sell vintage dolls that are not regarded as demeaning.
Despite the shift in the hobby, small kitschy objects such as full-lipped figures and rotund mammies remain popular, possibly because the 1964 Civil Rights Act -- which made it illegal to mass produce negative stereotypes -- helped to make all such items a "hot" commodity," said Jan Lindenberger, author of "Black Memorabilia Around the House" (Schiffer).
While some African-Americans buy insulting images to remove them from the market, others seek to reclaim ownership of the past and overcome the pain of history.
"Still others find that the objects reinforce their attitudes about race, allowing them to maintain the stereotypes and beliefs they have held since childhood," said Douglas Congdon-Martin, author of "Images in Black: 150 Years of Black Collectibles" (Schiffer, http://www.schifferbooks.com).
Ceramic cookie jars from the 1940s and '50s, mostly in the shape of mammies, now sell for $800 to $900, compared with $25 to $35 in the early '80s, said Lindenberger, a dealer. She sold a plain but rare one with a polka-dotted scarf, made by the Mosaic Tile Co. for $3,000. Another jar shaped like a mammy with an armload of cauliflower went for almost $2,000.
A wind-up 16-inch moving doll -- called a "store stimulator" because it was displayed in shop windows to stimulate business -- is worth $5,000 to $6,000, far more than the $100 that Lindenberger paid in 1979.
One of the most demeaning artifacts she sold was a 3-foot long slave yoke from around 1860, with a photo of two family members wearing it. Its selling price of $900 in 1979 went up to $3,000 10 years ago.
Buster's monthly "Black Memorabilia" newsletter (http://www.blackmemorabilianews.com), with a nationwide circulation of 2,000, keeps collectors up to date on the latest news and prices.
The gamut of collectibles and documents is available at the annual Black Memorabilia & Collectible Show and Sale in Gaithersburg, Maryland, to be held this year on Saturday, April 12 (http://www.johnsonshows.com). Former players of the Negro League baseball teams and former pro football player Fred "The Hammer" Williamson will be on-site to sign autographs.
By Richard Chang
NEW YORK (Reuters) - African Americans seeking to reclaim their past are turning a hobby once dominated by racist images into a cultural celebration instead, helping push prices of historical artifacts to new heights.
Documents about black slavery, politics, sports, literature and entertainment are showing up at auctions where once the only choices were mammy dolls, Aunt Jemima cookie jars, figures of boys eating watermelons, "Colored Only" signs and the like.
"Before the Civil Rights Movement many collectors were white. Most of the stuff was negative. After the movement blacks started demanding more positive images," said Larry Vincent Buster, author of "The Art and History of Black Memorabilia (Clarkson Potter, http://www.randomhouse.com/crown/clarksonpotter/).
In 1996 bookseller Wyatt Houston Day (http://www.abebooks.com/home/WHDBOOKS/) put together an annual auction of printed and manuscript African-Americana at Swann Galleries in New York (http://www.swanngalleries.com), helping to meet pent-up demand for such artifacts.
"As a rule, black memorabilia was created by whites stereotyping. There was no real venue for mainstream African-American history," he said. "I mean documents from the slave trade abolition and so forth, not to mention for lesser known authors from the Harlem Renaissance."
At the next Swann auction on Feb. 27, a graphite and crayon drawing on cardboard by folk artist Bill Traylor is estimated at $10,000 to $15,000. One of his works last sold for more than $20,000 at Sotheby's in 1997.
A 1858 poster (22 inches x 7 inches) advertising 82 slaves for sale by C.E. Girardey, one of the largest slave dealers in the South, is expected to fetch $4,000 to $6,000.
At a Swann auction in February 2001, an unpublished manuscript of a fictionalized slave narrative from around 1850 emerged. "The Bondswoman's Narrative by Hannah Crafts, a Fugitive Slave, recently Escaped from North Carolina," sold for $9,775.
A copy of Martin Luther King, Jr.'s 1964 book, "Why We Can't Wait," autographed by him "To my good friend James Farmer, ..." sold for $13,800 on Feb. 17, 2000.
At the same auction, a postcard dated July 21, 1955, from Malcolm X to "Marie Muhammad" fetched $3,680.
In the more popular arena, the Feb. 8, 1999, issue of Time magazine with hip-hop artist Lauryn Hill on the cover became a hot item after she won five Grammy Awards -- more than any other woman in history. The issue is now probably worth $150 to $500, Buster estimated.
A set of three politically correct black "Shani" dolls first sold by Mattel Inc. in July 1991 is probably worth $2,000, he said. And a 1984 Kellogg's cereal box featuring then-Miss America (news - web sites) Vanessa Williams -- which was pulled off supermarket shelves after photos of her were published in Playboy magazine, prematurely ended her reign -- could sell for $150 to $1,000, he noted.
Black Satin Collectibles, an online store, focuses only on collectibles that are "a celebration of our history," said site owner Sylvia Rosario (http://www.blacksatincollectibles.com). The site also sponsors the Black Memorabilia Collectors Club, which boasts 600 members from the United States, Britain, France, Africa and the Caribbean after being launched in 1998. Black Satin Collectibles sells the memorabilia of Josephine Baker, Dorothy Dandridge, Lena Horne, film and vintage videos and jewelry. They also sell vintage dolls that are not regarded as demeaning.
Despite the shift in the hobby, small kitschy objects such as full-lipped figures and rotund mammies remain popular, possibly because the 1964 Civil Rights Act -- which made it illegal to mass produce negative stereotypes -- helped to make all such items a "hot" commodity," said Jan Lindenberger, author of "Black Memorabilia Around the House" (Schiffer).
While some African-Americans buy insulting images to remove them from the market, others seek to reclaim ownership of the past and overcome the pain of history.
"Still others find that the objects reinforce their attitudes about race, allowing them to maintain the stereotypes and beliefs they have held since childhood," said Douglas Congdon-Martin, author of "Images in Black: 150 Years of Black Collectibles" (Schiffer, http://www.schifferbooks.com).
Ceramic cookie jars from the 1940s and '50s, mostly in the shape of mammies, now sell for $800 to $900, compared with $25 to $35 in the early '80s, said Lindenberger, a dealer. She sold a plain but rare one with a polka-dotted scarf, made by the Mosaic Tile Co. for $3,000. Another jar shaped like a mammy with an armload of cauliflower went for almost $2,000.
A wind-up 16-inch moving doll -- called a "store stimulator" because it was displayed in shop windows to stimulate business -- is worth $5,000 to $6,000, far more than the $100 that Lindenberger paid in 1979.
One of the most demeaning artifacts she sold was a 3-foot long slave yoke from around 1860, with a photo of two family members wearing it. Its selling price of $900 in 1979 went up to $3,000 10 years ago.
Buster's monthly "Black Memorabilia" newsletter (http://www.blackmemorabilianews.com), with a nationwide circulation of 2,000, keeps collectors up to date on the latest news and prices.
The gamut of collectibles and documents is available at the annual Black Memorabilia & Collectible Show and Sale in Gaithersburg, Maryland, to be held this year on Saturday, April 12 (http://www.johnsonshows.com). Former players of the Negro League baseball teams and former pro football player Fred "The Hammer" Williamson will be on-site to sign autographs.
Friday, January 17, 2003
An interesting article from Sean D'Souza of Psychotactics.com
His style may be simple, but sometimes the biggest problems we face have very simple answers.
http://www.psychotactics.com
**************************************************
The Biggest Reason Why Customers Are So Indecisive
**************************************************
Do you know why your customer won’t buy? You’ve given her the best price, possibly even the best options. Yet she fidgets. Maybe, maybe not, she ponders.
You stand by the wayside and sweat, praying the sale will go through. Then almost inexplicably, it slips out of your hand, and you don’t even know why. You curse, rant and rave silently at her indecisive nature. Yet ironically, the fault is all yours.
Don’t agree? Hold your horses and you’ll learn a simple, fundamental psychological factor you’ve been missing, and how you can rectify it in a flash.
*************************************************
Why The Trees In Our Front Yard Are Still Looking For a Barber
*************************************************
Let me tell you a story about our front garden. Any time now, I’m expecting Tarzan and a couple of chimps to swing merrily by. Like something out of a horror movie, the foliage has spread its tentacles, and now hangs menacingly over several parts of the house.
Yes I know we need an arborist to lop off those branches. And yes, we have called in at least half a dozen. Incredibly, we haven’t made up our minds on whom we should choose. Like deer caught in the headlights, we’ve been frozen in indecision. One itty-bitty factor would have made it easy to decide, but it has eluded us completely.
************************************************
I Know What You’re Thinking, And It’s Not Price…
************************************************
Oh boy! We’ve have estimates up to our ears. One quote is as high as $800 (aaargggh!), while the other one blushes at $250, and all the rest do a merry dance in between. You’d think the cheaper quote would get the thumbs up right away, wouldn’t you? Well it didn’t.
In fact, it’s added to the confusion because we can’t understand why there would be such a huge difference for what is essentially the same job.
************************************************
And Here Is The Reason Why We Can’t Decide...
************************************************
It’s a factor called the Full Story. While every single one of those arborists bombarded us with quotes, not one of them gave us a valid reason to choose them. Any reason would have been better than none. Ten reasons would have clinched the deal, even with a higher price.
This is one of the main reasons why most deals seem to disintegrate before the eyes of most business owners and salespeople. We fail (and fail miserably) to educate our customers about the unique advantages of working with us.
************************************************
It’s A Frustrating Puzzle If It Doesn’t Have The Pieces
************************************************
People need to be gratified psychologically. Our brains are dying to know more about the companies and all we get are terms and prices. The arborists should have educated me about the quality of their cutting, their comprehensive insurance policies, their warranties, their skills, and their service guarantees in detail. I needed to know anything and everything that would help me decide in someone’s favor. Not one of those bids included that kind of information.
Look at yourself. Let’s say you hire someone for your firm. How little would you like to know about him? You go out on a date. How little do you want to know about your partner? Every piece of the puzzle is absolutely necessary. Don’t forget to give your customers a reason to buy from YOU. Tell them about yourself. Provide all the juicy details, and you will leave your competitors crying in their beer.
************************************************
What Is The Psychological Reasoning Behind The Whole Story?
************************************************
The strong, silent type is the one our mamas told us to watch out for. We instinctively trust people less who tell us less. Even if we do like the person, we want them to open up. If you want people to trust you, you have to tell them about yourself.
This instinct of distrust is hard wired in our brains, and you’d do well to pay attention to it. A lack of adequate detail doesn’t help to build the trust, which is why customers go from hello to sayonara very quickly. Once you have their attention, stop saying stupid
things like, “Buy from me”, and start giving them all the reasons WHY they should buy from you (read the article on The Power of Why). Add the spices in your marketing curry, and your customer will be captivated by the aroma. Churn the gastric juices in their
brains. Make them salivate. Get them to drool. And when they’re ready to eat, feed them well.
************************************************
Ta-Ta Risk
************************************************
Telling the Whole Story eliminates a big hurdle called risk. The less your customer knows about you, the more they are frozen in indecision. When faced with this scenario they resort to the only thing they know—price. Just like you, they make a decision on
the cheapest, trashiest option available… because that’s all you gave them!
Abolish the hazard of your customer choosing to buy solely on price. Give her a first class education about why she needs to buy from you.
The worst thing you can do is leave her hanging without sufficient infor...
**************************************************************************
© 2003 PsychoTactics - Taking your customer's psychological 'bags' off the conveyor belt!
His style may be simple, but sometimes the biggest problems we face have very simple answers.
http://www.psychotactics.com
**************************************************
The Biggest Reason Why Customers Are So Indecisive
**************************************************
Do you know why your customer won’t buy? You’ve given her the best price, possibly even the best options. Yet she fidgets. Maybe, maybe not, she ponders.
You stand by the wayside and sweat, praying the sale will go through. Then almost inexplicably, it slips out of your hand, and you don’t even know why. You curse, rant and rave silently at her indecisive nature. Yet ironically, the fault is all yours.
Don’t agree? Hold your horses and you’ll learn a simple, fundamental psychological factor you’ve been missing, and how you can rectify it in a flash.
*************************************************
Why The Trees In Our Front Yard Are Still Looking For a Barber
*************************************************
Let me tell you a story about our front garden. Any time now, I’m expecting Tarzan and a couple of chimps to swing merrily by. Like something out of a horror movie, the foliage has spread its tentacles, and now hangs menacingly over several parts of the house.
Yes I know we need an arborist to lop off those branches. And yes, we have called in at least half a dozen. Incredibly, we haven’t made up our minds on whom we should choose. Like deer caught in the headlights, we’ve been frozen in indecision. One itty-bitty factor would have made it easy to decide, but it has eluded us completely.
************************************************
I Know What You’re Thinking, And It’s Not Price…
************************************************
Oh boy! We’ve have estimates up to our ears. One quote is as high as $800 (aaargggh!), while the other one blushes at $250, and all the rest do a merry dance in between. You’d think the cheaper quote would get the thumbs up right away, wouldn’t you? Well it didn’t.
In fact, it’s added to the confusion because we can’t understand why there would be such a huge difference for what is essentially the same job.
************************************************
And Here Is The Reason Why We Can’t Decide...
************************************************
It’s a factor called the Full Story. While every single one of those arborists bombarded us with quotes, not one of them gave us a valid reason to choose them. Any reason would have been better than none. Ten reasons would have clinched the deal, even with a higher price.
This is one of the main reasons why most deals seem to disintegrate before the eyes of most business owners and salespeople. We fail (and fail miserably) to educate our customers about the unique advantages of working with us.
************************************************
It’s A Frustrating Puzzle If It Doesn’t Have The Pieces
************************************************
People need to be gratified psychologically. Our brains are dying to know more about the companies and all we get are terms and prices. The arborists should have educated me about the quality of their cutting, their comprehensive insurance policies, their warranties, their skills, and their service guarantees in detail. I needed to know anything and everything that would help me decide in someone’s favor. Not one of those bids included that kind of information.
Look at yourself. Let’s say you hire someone for your firm. How little would you like to know about him? You go out on a date. How little do you want to know about your partner? Every piece of the puzzle is absolutely necessary. Don’t forget to give your customers a reason to buy from YOU. Tell them about yourself. Provide all the juicy details, and you will leave your competitors crying in their beer.
************************************************
What Is The Psychological Reasoning Behind The Whole Story?
************************************************
The strong, silent type is the one our mamas told us to watch out for. We instinctively trust people less who tell us less. Even if we do like the person, we want them to open up. If you want people to trust you, you have to tell them about yourself.
This instinct of distrust is hard wired in our brains, and you’d do well to pay attention to it. A lack of adequate detail doesn’t help to build the trust, which is why customers go from hello to sayonara very quickly. Once you have their attention, stop saying stupid
things like, “Buy from me”, and start giving them all the reasons WHY they should buy from you (read the article on The Power of Why). Add the spices in your marketing curry, and your customer will be captivated by the aroma. Churn the gastric juices in their
brains. Make them salivate. Get them to drool. And when they’re ready to eat, feed them well.
************************************************
Ta-Ta Risk
************************************************
Telling the Whole Story eliminates a big hurdle called risk. The less your customer knows about you, the more they are frozen in indecision. When faced with this scenario they resort to the only thing they know—price. Just like you, they make a decision on
the cheapest, trashiest option available… because that’s all you gave them!
Abolish the hazard of your customer choosing to buy solely on price. Give her a first class education about why she needs to buy from you.
The worst thing you can do is leave her hanging without sufficient infor...
**************************************************************************
© 2003 PsychoTactics - Taking your customer's psychological 'bags' off the conveyor belt!
The article below arrived in my inbox and started me thinking about the notion of quality-of-life branding. Would I buy wine at Target? absolutely! Would I buy wine at Walmart? Not since I was a poor, poor college student and would not likely admit it anywhere but here.
Quality-of-life branding. Can you think of examples? Send some my way:
-------------------------------------------------
Target Thinks Outside the Box Wine
With interactive displays and its own sommelier, the discount retailer tries to make wine snobs out of its frugal shoppers.
By Thomas Mucha, January 16, 2003
When Wal-mart (WMT) launched its own wine label -- Alcott Ridge Vineyards, produced by E&J Gallo -- in 2000, wine buffs answered with a chorus of snickers about the new "white trashfandel" and "nasti spumante" you could suddenly find at Sam's Club. The decidedly lowbrow strategy eschewed real marketing finesse for brutal simplicity: Sell cheap wine, and a lot of it. Wal-Mart, of course, got the last laugh. Today, Alcott Ridge is a multimillion-dollar wine label, and according to the Wine Institute, nearly 40 percent of all wine sold in the United States reaches American palates through discount retailers and supermarkets.
Now the nation's second-biggest discounter, Target (TGT), is jumping on the economical-wine crush with a strategy that makes Wal-Mart's look unimaginatively sober. Last summer it began clearing out cheap chablis and box wines and replacing them with middle-market labels priced from $7 to $10, handpicked by Andrea Immer, dean of wine studies at the French Culinary Institute in Manhattan and Target's new (don't laugh) master sommelier.
If Wal-Mart's wine binge was built around the simple idea that wine doesn't have to be expensive, Target's upscale move adds a new twist. As Immer says, "It doesn't have to be expensive to be good." Simply put, Target hopes to lure thousands of discount shoppers into higher-margin but lower-priced quality wines. How? By making a visit to Target more like a wine-tasting jaunt to Napa Valley than, well, a trip to Wal-Mart. By hiring Immer to lead the effort, Target is playing directly to the baby boomer women who are the chain's core customers. In addition to her official credentials, the cover-girl-attractive 36-year-old is probably the wine industry's most glamorous spokesperson and one of just 11 female master sommeliers in the world.
Immer designed the large display cases that serve as the stage for more than 100 respectable labels, such as Beringer and Redwood Creek, 90 percent of them priced under $10. The centerpiece of those displays, now installed at more than 80 SuperTarget stores, is a kind of "wine for dummies" exhibit, in which giant posters guide shoppers through Immer's four-step process to understanding wine -- fruit flavor, body style, color, and oak flavor. To give a clear frame of reference, the displays include graphic explanations of various wine tastes, with pictures of tart or sweet foods beneath wine styles, from sauvignon blanc to port.
Those who need more help can experiment with a "wine wheel," which matches varietals with workaday meals like canned soup or boxed macaroni and cheese. Above it all is Immer's reassuring face, smiling down on shoppers and her best-selling wine books (those are for sale too). Immer has also agreed to host a number of wine tastings and book signings at SuperTarget stores throughout 2003.
What isn't on display is the main reason that Target green-lighted the overhaul: While profit margins hover near 20 percent for typical $5 "trashfandel," they easily pass 30 percent for the higher-quality wines in Target's new range -- even after they're discounted. (A bottle of Kendall-Jackson chardonnay that goes for $12 or more at most boutique wine shops can be had at SuperTarget for about 10 bucks.) Better yet, Immer believes, purchasers of $10 wines will eventually gain the confidence to pop for the occasional $20 or $30 bottle, where margins can hit 50 percent and above. And, yes, SuperTarget stores now stock some of those pricier brands too.
Target won't divulge its goals for wine sales, but industry trends certainly point in its favor. Sales of bottles in the $7-to-$10 range have been growing at double-digit rates for the past several years, while those of bargain-priced and box wines have fallen flat. Even better, the prototypical American wine drinker is a married white woman in her 40s, with a college degree, who drinks wine at home -- in other words, your average Target shopper. "It's a phenomenally good idea," says Vic Motto, a Napa Valley wine industry consultant. "They should have done this years ago."
Quality-of-life branding. Can you think of examples? Send some my way:
-------------------------------------------------
Target Thinks Outside the Box Wine
With interactive displays and its own sommelier, the discount retailer tries to make wine snobs out of its frugal shoppers.
By Thomas Mucha, January 16, 2003
When Wal-mart (WMT) launched its own wine label -- Alcott Ridge Vineyards, produced by E&J Gallo -- in 2000, wine buffs answered with a chorus of snickers about the new "white trashfandel" and "nasti spumante" you could suddenly find at Sam's Club. The decidedly lowbrow strategy eschewed real marketing finesse for brutal simplicity: Sell cheap wine, and a lot of it. Wal-Mart, of course, got the last laugh. Today, Alcott Ridge is a multimillion-dollar wine label, and according to the Wine Institute, nearly 40 percent of all wine sold in the United States reaches American palates through discount retailers and supermarkets.
Now the nation's second-biggest discounter, Target (TGT), is jumping on the economical-wine crush with a strategy that makes Wal-Mart's look unimaginatively sober. Last summer it began clearing out cheap chablis and box wines and replacing them with middle-market labels priced from $7 to $10, handpicked by Andrea Immer, dean of wine studies at the French Culinary Institute in Manhattan and Target's new (don't laugh) master sommelier.
If Wal-Mart's wine binge was built around the simple idea that wine doesn't have to be expensive, Target's upscale move adds a new twist. As Immer says, "It doesn't have to be expensive to be good." Simply put, Target hopes to lure thousands of discount shoppers into higher-margin but lower-priced quality wines. How? By making a visit to Target more like a wine-tasting jaunt to Napa Valley than, well, a trip to Wal-Mart. By hiring Immer to lead the effort, Target is playing directly to the baby boomer women who are the chain's core customers. In addition to her official credentials, the cover-girl-attractive 36-year-old is probably the wine industry's most glamorous spokesperson and one of just 11 female master sommeliers in the world.
Immer designed the large display cases that serve as the stage for more than 100 respectable labels, such as Beringer and Redwood Creek, 90 percent of them priced under $10. The centerpiece of those displays, now installed at more than 80 SuperTarget stores, is a kind of "wine for dummies" exhibit, in which giant posters guide shoppers through Immer's four-step process to understanding wine -- fruit flavor, body style, color, and oak flavor. To give a clear frame of reference, the displays include graphic explanations of various wine tastes, with pictures of tart or sweet foods beneath wine styles, from sauvignon blanc to port.
Those who need more help can experiment with a "wine wheel," which matches varietals with workaday meals like canned soup or boxed macaroni and cheese. Above it all is Immer's reassuring face, smiling down on shoppers and her best-selling wine books (those are for sale too). Immer has also agreed to host a number of wine tastings and book signings at SuperTarget stores throughout 2003.
What isn't on display is the main reason that Target green-lighted the overhaul: While profit margins hover near 20 percent for typical $5 "trashfandel," they easily pass 30 percent for the higher-quality wines in Target's new range -- even after they're discounted. (A bottle of Kendall-Jackson chardonnay that goes for $12 or more at most boutique wine shops can be had at SuperTarget for about 10 bucks.) Better yet, Immer believes, purchasers of $10 wines will eventually gain the confidence to pop for the occasional $20 or $30 bottle, where margins can hit 50 percent and above. And, yes, SuperTarget stores now stock some of those pricier brands too.
Target won't divulge its goals for wine sales, but industry trends certainly point in its favor. Sales of bottles in the $7-to-$10 range have been growing at double-digit rates for the past several years, while those of bargain-priced and box wines have fallen flat. Even better, the prototypical American wine drinker is a married white woman in her 40s, with a college degree, who drinks wine at home -- in other words, your average Target shopper. "It's a phenomenally good idea," says Vic Motto, a Napa Valley wine industry consultant. "They should have done this years ago."
