Secrets of the Top 10 Most Powerful Retailers

Secrets of the Top 10 Most Powerful Retailers
By Michael Hess | August 25, 2011



This week RetailSails released its report on the top retail chains in the U.S. ranked by the industry standard of sales per square foot. One glance at the list and you’ll see that these retailers are throwing haymaker, knockout punches, with numbers that are off the charts for their categories. That they’re posting these stats over the last four quarters in a dismal economy makes it all the more impressive.

Despite the fact that these companies represent a diverse sampling of industries — from gadgets to gold to golf shirts — almost all of them have woven their success from common threads, which I’ll get to in a moment.

Here’s a look at the top 10 retailers and their sales per square foot:

1. Apple: $5,626

2. Tiffany & Co.: $2,974

3. Coach: $1,820

4. Lululemon Athletica: $1,731

5. GameStop: $1,009

6. Costco Wholesale: $998

7. Signet Jewelers: $955

8. Polo Ralph Lauren: $904

9. Whole Foods Market: $867

10. Best Buy: $831

For perspective, consider that a hot and much-admired retailer like Target has sales per square foot in the neighborhood of $290, typical of many retailers in many segments. That means that an Apple store — which might dedicate the same display space to one phone as Target does to a full rack of clothes — extracts almost 2000% more revenue from that real estate.*

So what is it that these star performers are doing to put up such extraordinary numbers? Not all of the same rules apply to every one of these companies, but all of them excel at one thing: creating “gotta have it” retail environments, products, and experiences in one or more of these ways:
They turn “I want” into “I need“: Other than Costco selling staple groceries, not one of these companies sells anything that anyone genuinely needs. But through a combination of drool-worthy products, exceptional merchandising, buzz, and fomenting what amounts to peer pressure among their target customers (”I’ve gotta have what she has!”), these companies pull off masterful manipulations of customer psychology. A discretionary want becomes a can’t-live-without need. I might get myself into trouble here, but no woman needs another handbag. If she does, she certainly doesn’t need a $1,000 Coach python handbag. But so-and-so is carrying one… and besides, they last forever, and really, you haven’t treated yourself to a nice new bag in ages. Suddenly, you need that bag. The product and the store elicit an emotional response, and emotion trumps reason.
They aren’t afraid of high prices: On the contrary, high prices are a key part of the formula for nearly all of these companies (Costco being the most notable of one or two exceptions, but it works its magic in other ways). More expensive suggests better (even if it’s not) and more exclusive (or elusive). A high price offers entry into a club of sorts. Anyone can buy a polo shirt for $20, but one with a horse on it, folded just-so on a fancy table, in a store that smells great? That screams status, and that’s worth $85. The $85 shirt buys a “membership” that the $20 shirt does not. Same goes for a $300 MP3 player, $100 yoga pants, or anything in an iconic, light blue box.
They employ “strategic scarcity”: It’s hard-wired from childhood that one of the best ways to make someone want something is to tell him he can’t have it. And many of these killer companies use this weapon, either in reality by controlling production (wait in line or you might not get one), or perception (only one purse in a heavenly-lit cubicle in a sparsely-stocked boutique). Both fuel rabid desire and support high prices. Luxury items — even some as outrageously extreme as the $2 million Bugatti Veyron supercar — often have waiting lists of buyers in the worst of economic times. Most of us aren’t in the market for that kind of transportation, but the same psychology applies when the newest video game console is predicted to sell out on release day.

For sure, the high-end usually takes a hit when times are tough. But in the long run, there is always a market for the best, or what we are made to believe is the best. Me-too companies come and go, but companies synonymous with exclusivity, aspiration, and want-over-need are often the oldest and most enduring: Rolex since 1905; Louis Vuitton since 1854; Rolls Royce since 1904.

In many ways these companies and their strategies fly in the face of conventional business wisdom. They don’t fill needs or solve problems — especially the ones typically associated with a crummy economy. They don’t necessarily target the largest possible audience. With some exceptions, they don’t even try to price competitively. What they do is trigger powerful, visceral emotions: They provide the most excitement, desire, pleasure, lust, envy and happiness per square foot.

[* It will be interesting to see if anything changes post-Jobs, but Apple has a pretty colossal lead, knows the formula, and Jobs will still have a voice for the time-being, so early bets are that they'll be just fine.]

Michael Hess is founder and CEO of online retailer Skooba Design, which designs and manufactures an award-winning line of carrying cases for laptops and other applications. He also has a background in merchandising, sales, marketing, and purchasing for bricks & mortar retailers.

Flickr photo courtesy of nechbi, CC 2.0.


http://www.bnet.com/blog/customer-relationship/secrets-of-the-top-10-most-powerful-retailers/780?promo=713&tag=nl.e713

The Secrets of Attending College Without Student Loans

The Secrets of Attending College Without Student Loans

By Lynn O'Shaughnessy | Aug 25, 2011


The majority of students, who graduate from college, leave with a diploma and student loans. Two out of every five undergrads, however, earn a degree without borrowing for college. In the most recent reporting year available, that equals about 1.7 million undergrads.

Who are these lucky students? Mark Kantrowitz, the founder of FinAid, a comprehensive financial aid website, decided to find out what kind of students managed to graduate debt free.

Here is what Kantrowitz discovered:

1. 85% of students who graduated with no debt attended public colleges and universities and 78% enrolled in in-state institutions.

2. Selecting an inexpensive school was the best way to dodge student debt. Eighty eight percent of students, who graduated debt free, attended schools where the tuition was less than $10,000.

3. Only 30% of students graduating from private, nonprofit colleges left without loans.

4. Fifty-one percent of graduates of public institutions weren’t burdened with debt.

5. The best way to accumulate debt was to attend a for-profit school. Only 7% of students who enrolled in for-profit colleges graduated with zero student loans.

6. About 75% of students with no debt spent $1,000 a year or less on textbooks.

7. Fifty six percent of affluent students left college without debt.

8. More than two thirds of students, who avoided loans, received financial help from their parents.

9. Students whose parents earned advanced degrees were more likely to graduate without debt.

10. Forty-five percent of middle-income students incurred no student loans.

11. Thirty-six percent of poor students graduated with loans.

12. Half of students, who graduated with no debt, earned a degree at a community college.
Bottom Line:

While it might seem from media reports that nearly all students are reeling from college debt, a significant minority aren’t. Just as importantly, three fifths of students graduate with less than $10,000 of college loans, which should be a manageable amount for many young Americans.

Lynn O’Shaughnessy is author of The College Solution, an Amazon bestseller, and the Shrinking the Cost of College workbook. She also writes her own college blog at The College Solution.

http://moneywatch.bnet.com/spending/blog/college-solution/the-secrets-of-attending-college-without-student-loans/6414/

Today’s Students Want to Learn in New Ways

Today’s Students Want to Learn in New Ways
by Ladan Nikravan on August 22, 2011 · Comments · in Ask A Gen Y


Millennials want to learn. Organizations want a return on their investment. By building the right infrastructure, leveraged by technology, companies can define new competencies and skills and align learning to them to improve performance – ultimately boosting the bottom line. Today’s students, and freshmen in the working world, want to participate in this learning — not just be receivers of information. They want an innovative way to learn; one that brings together discussions with the aid of technology. They want immediate, consistent access.

The University of Central Florida’s College of Medicine has developed a program that allows its students to use an electronic telescope to view magnifications of human cells, label those cells, take notes and quizzes on the information and email their assignments back to their instructor for feedback. Because the material is computer-based, students have access to it 24/7. This electronic lab manual encourages team learning and interaction with educational materials, characteristics that appeal to millennial-aged learners such as UCF medical students, according to Mohammed Khalil, assistant professor of anatomy at UCF. The feedback Khalil has received so far as been encouraging, and this isn’t surprising. As I’ve mentioned before, Millennials want online, collaborative learning.

Much like the generations before them, Generation Y employees bring specific learning values and ideals to employee education that will alter learning and development strategies. Companies that make an effort to understand and act upon these employees’ viewpoints will find themselves with a dedicated and ambitious group of workers.

Younger employees are joining the workforce with a background in collaborative technology; this is why they expect it from employee education. Designed by Digital Millennial Consulting, with support from Microsoft and Qualcomm Inc., Project K-Nect allows students to use smartphones to communicate with each other as they solve problems in secondary school math classes. Students videotape themselves solving a problem, and then they post the video to a blog. Students having trouble with a problem can consult the blog and see how their classmates solved it. In 2008-09 more than 90 percent of Project K-Nect Algebra 1 students achieved proficiency on end-course assessments, compared to 70 percent of Algebra 1 students in their district and 68 percent in the state. First implemented in North Carolina, this program is broadening its reach to other states to create more learning communities in the classroom.

Learning institutions that want to lure millennial students understand Gen Y’s needs. For example, Richard N. Landers, an assistant professor of psychology at Old Dominion University, created an online social network for his university’s psychology classes that encourages students to take optional multiple-choice quizzes during their free time to earn badges certifying mastery of a subject. Those badges then appear next to the player’s name in the online discussion rooms for each class. These ribbons encourage students to take extra quizzes that have absolutely no effect on their grade. This encourages learning but doesn’t make it forced or intimidating. This sort of employee education in the office classroom could yield the same enthusiasm for learning.

Attracting and keeping the best and brightest members of the young workforce requires a transformation in how learning leaders manage employee education’s motivation and tools. The newest crop of workers is collaborative and team-oriented, and at times takes access to technology for granted. But millennials’ use of technology creates a seamless environment that mingles business information with team communication, a process that can enhance personal and organizational growth.


Ladan Nikravan

Ladan Nikravan is an associate editor of Chief Learning Officer magazine. She is from Chicago, and graduated from the University of Missouri School Of Journalism, where she majored in magazine journalism, in May 2010. Prior to joining MediaTec, Ladan worked as a reporter for the Columbia Missourian newspaper, Vox magazine, Chicago Home Improvement magazine and American Builders Quarterly. Although a writer at heart, she has dipped her toes into most facets of the publishing world: feature writing, hard news and column writing; freelancing; copy editing; page design; Web design and some photography. She can be reached at lnikravan@CLOMedia.com.
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http://blog.clomedia.com/2011/08/the-current-generation-of-students/