tag:blogger.com,1999:blog-32202893.post8466285095404544431..comments2023-10-18T08:32:17.510-07:00Comments on Kevin Hillstrom: MineThatData: Fetzer's Footwear: KnockoffUnknownnoreply@blogger.comBlogger6125tag:blogger.com,1999:blog-32202893.post-29781170680206648532010-07-16T06:34:33.227-07:002010-07-16T06:34:33.227-07:00@Kevin
You're right. Every day, facts, arguem...@Kevin<br /><br />You're right. Every day, facts, arguements, and alternate realities (which are all true to the people who hold them) collide in boardrooms.<br /><br />Analysts who go on to become leaders are indeed surprised by what goes on. They'll have to get used to it.<br /><br />And you're doing a great service here by pointing that reality out.Christopher Berryhttp://www.christopherberry.canoreply@blogger.comtag:blogger.com,1999:blog-32202893.post-6555271593899220812010-07-15T17:36:01.755-07:002010-07-15T17:36:01.755-07:00Sure, nobody would argue against your point of vie...Sure, nobody would argue against your point of view, or against Christopher's point of view.<br /><br />These things are written to reflect the kind of discussions that happen in companies when business leaders gather for meetings. In those meetings, rational facts and MBA strategies and common sense struggle to compete against opinions, arguments, politics, tribal knowledge, scattered priorities, and general misinformation.MineThatDatahttps://www.blogger.com/profile/14014200122021988374noreply@blogger.comtag:blogger.com,1999:blog-32202893.post-73686372799537665052010-07-15T16:21:39.215-07:002010-07-15T16:21:39.215-07:00In SEO we can get a company to rank #1 but that do...In SEO we can get a company to rank #1 but that doesn't necessarily mean the client's going to buy. There has to be something that distinguishes the brand. Christopher pretty much concurs with what I said about the brand and that's the missing value. Sell that sizzle! If the site is old and boring of course nobodies going to buy. Ecommerce should be updated regularly.Edmonton SEOhttps://www.blogger.com/profile/11759580898636170537noreply@blogger.comtag:blogger.com,1999:blog-32202893.post-30187693355873011622010-07-15T13:13:59.662-07:002010-07-15T13:13:59.662-07:00So let's take the two essays above, and have e...So let's take the two essays above, and have each one presented to management teams at real companies ... it would be fun to watch the interactions between presenters and the business leaders who would be asked to heed the advice of the presenter.MineThatDatahttps://www.blogger.com/profile/14014200122021988374noreply@blogger.comtag:blogger.com,1999:blog-32202893.post-53045157844536626502010-07-15T08:09:01.037-07:002010-07-15T08:09:01.037-07:00Lauren is asking for a strategic answer to a strat...Lauren is asking for a strategic answer to a strategic problem.<br /><br />My approach to such problems is systematic. I refuse to accept the tradeoffs as presented to me. It's not a question of binary '1' or '0' position statements that all result in less than optimal outcomes. All the outcomes are unacceptable.<br /><br />Here's what's salient:<br /><br />Their R&D is not producing a sustainable competitive advantage because they cannot defend their market position. (It's undercut by imitators).<br />They're brand does not appear to be positioned over on top of R&D (no mention of that).<br />They have a brick and click infrastructure.<br />They are not investing in retail footprint.<br />They are not investing in making the eCommerce presence competitive with the service innovations at Zappos.<br />They have invested in mobile, but are balking at 'cannabalization'. (ecommerce might be flat).<br />They're a regional player with a national eCommerce footprint.<br /><br />Laura has asked a very direct question. How do we respond to price pressure and service pressure? I think this question masks the real question: 'what is our strategy'?<br /><br />I consider the architecture of the problem:<br /><br />There's a whole bunch of choices that just don't make sense. They're investing in R&D, but the market, effectively, doesn't care. Stores rot while the eCommerce isn't competitive. Arguably they only have so much capital to turn this thing around.<br /><br />Metaphorically, they're a fickle university student that has reached their second year and needs to settle down on a major. What are they going to be when they grow up? They sure as hell can't be a national ecommerce play with a research arm with a sprawling pacific northwest retail footprint. Too much going on!<br /><br />The resolution, using that architecture, is open ended. How do they arrive at competitive advantage?<br /><br />Choice.<br /><br />True to form, my suggestion would be reasoned that they can't become Zappos (that position is taken) and they can't become foot locker (that position is taken). They do have one very good strategic pivot in a R&D differentiators. How do you guard from knockoffs? [Insert analytical competitive analysis here to support this point, which, is just a hypothesis]<br /><br />Reach for another metaphor. Bose. Branding.<br /><br />If they're going to compete on R&D, they need to take up a position similar to Bose. They do one thing incredibly well, and everybody knows it. [Insert analytical analysis of the Bose market position in the audio electronics sector, which is just a hypothesis]<br /><br />It means something has got to give. They got loads of stores in the NorthWest. That's nice. They appear to be dying and the margins are not good. They're ultimately in need of capital investment which will take away from R&D. If they're going to compete on brand and R&D, that means spinning them off. Selling them to franchise's. They should retain a flagship store in a major coastal city to generate excitement and have halo effect. Anything that looks tired and worn must go. [Insert capital investment analysis here]<br /><br />R&D should be integrated into that store.<br /><br />Next, if Zappos can deliver faster, perhaps Zappos should bear that? Maybe the company shouldn't even be involved in its own distribution. If they do, they can hold onto their mobile channel and watch it grow, if that works with their brand. [Insert channel analysis efficiency framework here]<br /><br />In effect, Laura does not make the radical decision to focus on just one aspect of the business, they will see other pureplay competitors enter into the market and kill them.<br /><br />Spanning across too many pivots is a recipe for their ongoing failure.<br /><br />There are hundreds of other strategic pivots, Kevin. There really are. That's my analysis based on the facts presented.<br /><br />Everything else becomes the 'strategy of how'. How to wind down bricks. How to wind down clicks. How to service mobile from the flagship. etc. Not trivial. From macro-strategy flows choice.Christopher Berryhttp://www.christopherberry.canoreply@blogger.comtag:blogger.com,1999:blog-32202893.post-92067390158519069262010-07-15T06:40:21.336-07:002010-07-15T06:40:21.336-07:00The difference between a $100 pair of shoes, and a...The difference between a $100 pair of shoes, and a $600 pair of shoes is the value demonstrated. Value is generated in the presentation, and by distinguishing yourself from the competition in showing the quality of the product/brand etc. However, the one thing you might be missing is that there's a $100 client that can't afford the higher end shoes. Not everyone can buy a Ferrari but they should at least know the value of owning one. Lets face it there's more fans than there is owners, and the opportunity cost for some might be too high.<br /><br /> The traditional online buyer is looking for lower prices so instead of buying they could be doing research then either buying for the best online price or going to the store. So instead of charging the same prices online as in the store lower the online costs slightly as store front has a much higher overhead which saves both you and the customer while creating incentive for more sales. According to a study shown in "The Art of SEO" by Rand Fishkin the average business gets $6 in store for every dollar spent advertising online. Not all value can be measured with web analytics. However, it's well known that the web is used for research and bargain hunting which means if you want to increase your online sales demonstrate that it's cheaper than your stores not necessarily your competition.<br /><br /> In todays market anything with upwards of 5% margin is phenomenal. Most of the largest companies today are successful due to the volume they're putting out. I'd say lower the prices online, and increase sales volume. If you have a competitor with a relatively similar item yours better entirely define why it's better with incredible branding otherwise business is indeed going to go to the competition. The one opportunity that you might not be seeing here is that as your volume of shoes produced increases your prices drop for manufacturing, and you can easily afford to ship. I recently did some research for my online store 200k items and I discovered that one could ground ship items at super low prices especially as volume increases. My point is that as you lower your prices your volume increases, overhead is lowered, and you're able to offer things that your high volume competitors are offering. It pays to reward your customers (especially online). Where's their online incentive to buy vs in store where they can try the shoes on?Edmonton SEOhttps://www.blogger.com/profile/11759580898636170537noreply@blogger.com