In the current economic climate, shopping at the nation’s largest retail stores seems to be far from consumers’ minds. Faced with consumers who are increasingly wary about where and how they spend, retailers are bulking up their marketing departments by hiring experienced executives, unveiling new strategies and improving the shopping experience.
For example, The Home Depot recently appointed a CMO with a strong background in marketing and customer management: Frank Bifulco. He had served as chief customer officer and president of toy manufacturer Hasbro North America Sales, where he oversaw sales and customer strategies.
Bifulco, who also gained CMO experience at Coca-Cola and Procter and Gamble, will be responsible for Home Depot’s strategic marketing vision, category marketing and brand development. Executives at the home improvement retailer hope that focusing on employee-customer interactions and store and merchandise improvement will boost falling sales.
“I believe we will look back on 2007 as one of the most difficult years ever for The Home Depot financially,” said Frank Blake, The Home Depot chairman and CEO, in a February earnings call. “I also believe we will look back on it as one of the most important years for the long term health of the business.”
Black went on to say that The Home Depot would invest heavily in store maintenance and repair and in putting more salespeople on the floor for customer service.
Lord & Taylor has also been investing in its customer relationship strategies in an effort to entice shoppers. To drive its latest effort, Lord & Taylor hired its first CMO, Roger Adams, in mid-April. Adams, who previously served as CMO at The Home Depot, will be in charge of brand management and creative and media services.
Lord & Taylor kicked off its rebranding effort last fall, upgrading merchandise and in-store services and adding new amenities. The store also revamped its Web site to create a more personalized shopping experience online. The company declined to comment more specifically to DMNews.
“[Retailers] must market to the customer’s heart,” said Lois Boyle-Brayfield, president of J. Schmid and Associates, a catalog and multichannel direct marketing company that works with retailers including Cabela’s, L.L. Bean and Bath & Body Works. “It’s about competition for time because people are bombarded with so many messages and, to be an end destination brand, we have to be more than just a store. We have to provide higher order benefits.”
Of course, for customers to notice improved customer service, retailers must first get them into stores.
“The offer has to be so clear and apparent that the consumer says, ‘Wow, I just have to go check that out,” noted Britt Beemer, chairman and founder of America’s Research Group. “The problem is, retailers don’t make a big enough deal of what they’re doing, and consumers don’t get excited or go out and shop.”
Lord & Taylor has been trying to combat this consumer reticence with an upscale print campaign in magazines including Vogue and Vanity Fair. The ads, which debuted in February, were also placed on billboards and kiosks in Boston and Philadelphia, as well as in railroad stations in Lord & Taylor markets throughout the Northeast.
Celebrity-laden ads may work to build some excitement, Beemer says, but he points out, “When people are looking at ads today, they’re 50% more attentive to the hot specials or deals.”
In a move that reflects this need for special offers and meaningful deals, The Home Depot is jumping on the dual headline grabbers of tax rebate checks and “going green.” The store is urging shoppers to use rebate checks on energy-saving light bulbs and appliances.
Other retailers are also leveraging the frenzy surrounding the economic stimulus. Sears, for example, is offering gift cards in exchange for the tax rebate checks, with a 10% bonus on the price.
