Tuesday, December 28, 2010

4 trends may help sharpen marketing for 2011

We seem obsessed with predicting the future, and it goes beyond who will win the Super Bowl or how many more times Lindsay Lohan will be ordered to rehab.
For marketers, there is no lack of pundits and organizations lined up to help you see what is around the corner. One group that appears to have a good handle on trends that will help define business is Vistage International. This San Diego-based executive leadership firm is made up of 14,000 business professionals worldwide who work together in small, peer advisory groups.

Vistage recently published a report on 12 trends it believes create opportunities for business. I found four of the predictions especially relevant to marketers.

Short-term consumer thinking: Coming off the worst financial crisis in decades, fear based on the inability to predict what might happen next has prompted purchases based on immediate need.

"People are now thinking more about the here and now and less about things that may or may not last a long time," said William Higham, trend analyst and author of The Next Big Thing-Spotting & Forecasting Consumer Trends for Profit .

Mobile purchasing: The U.S. will soon catch up to consumers in Japan and Sweden in the ability to use mobile phones for transactions. If you have been in an Apple store recently, you might have seen a card reader attached to an employee's iPhone. Without going to the checkout desk, the employee will swipe your credit/debit card and offer to e-mail you a receipt. Quicker, faster, cooler.

Behavioral segmentation: That's a mouthful. But it means you can craft more relevant, and therefore more effective, communications by taking steps to better understand your customers' behavior, especially how they act and react to your digital offerings.

Using non-threatening analytical tools, you can develop profiles based on how people use your website content, which offers they respond to, what they buy, which e-mails they open and the information provided during registration.

The product offerings served up to customers on Amazon and Netflix are a great example of proper behavioral segmentation.

The traditional sales model evolves: The traditional sales cold call may be a thing of the past for many industries.

"Now the process has been reversed. We attempt to get the client to come visit us. Pull marketing instead of push selling," said Vistage speaker and sales consultant Sam Bowers.

Here are some of the basic elements of an effective pull marketing program: a robust and highly functional website with detailed product information, an easy way to buy online, customer product reviews posted on third-party sites, targeted advertising that leads prospects to your site, and an aggressive website search optimization program.

Also, research trends and seek sound advice to help plan your business's future. Using your own shoe leather and intellect can be even more reliable than following some pundit's sound bite prediction of the next big thing.

David Bohan founded BOHAN Advertising|Marketing, a Nashville agency with clients in travel, hospitality, health care and consumer products, in 1990. He has worked in marketing and advertising since earning a degree at the University of Tennessee-Knoxville in 1970.

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Buyers Interested in WalkabilityNashville People in Business

Retailers expect big end to 2010

ATLANTA — An East Coast snowstorm put a damper on after-Christmas shopping Sunday. But shoppers across the rest of the country scoured clearance racks and spent gift cards during the afterglow of the best holiday season for retailers since 2007.
Blizzard warnings stretched from New Jersey to Maine. Up to 20 inches of snow was expected in Philadelphia and Boston and up to 16 inches in New York City.

"The forecast will tend to keep (shoppers) at home. It's not the best day for shopping," said Scott A. Bernhardt, chief operating officer at weather research firm Planalytics.

Because the storm is after Christmas, the loss will hurt retailers less than last year's snowstorm the Saturday before Christmas that buried much of the same area. That one cost retailers about $2 billion. This time, there's no Dec. 25 deadline.

RelatedChristmas Eve rush caps banner shopping seasonLast-minute shopping in Nashville area gives retailers high hopesGroceries as gifts indicate new practicality for holidayShoppers crowd stores as season winds downBeware: Return policies vary widelyMore shoppers make Nashville stores upbeatStrong holiday sales may indicate better 2011Smart phone users expect a lot from retailers

"People will just wait a day to do exchanges and use their gift cards. It's no big deal," said Greg Maloney, CEO of the retail practice of Jones Lang LaSalle, which manages malls across the country.

He expects December revenue to grow a healthy 7 percent to 10 percent from last year.

Strong spending this week would build on the highest-spending holiday season since 2007, a record year. Dec. 26-Jan. 1 makes up less than 10 percent of the Nov. 1-Dec. 31 season but accounts for more than 15 percent of holiday spending, research firm ShopperTrak says.

Predictions call for retail revenue increase of 3 percent to 4 percent for the whole season, the best percentage increase since 2006.

The snow will send some shoppers online, where sales have been stellar. IBM Coremetrics said online spending rose more than 16 percent the week ending Christmas Day, while the average order rose 13 percent to $192.52. From Nov. 1 through Dec. 19, total online spending rose 12 percent to $28.36 billion, according to research firm comScore Inc.

The day after Christmas was the second-highest revenue day for retailers last year, with $7.9 billion spent, according to ShopperTrak.

Improved weather outside the East Coast will bring out the shoppers. The nation's largest mall, the Mall of America in Bloomington, Minn., expected 100,000 shoppers Sunday.

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Shoppers crowd stores as season winds downReal Estate Outlook: Small Gains

Lower concert ticket prices expected as attendance slips

LOS ANGELES — Concertgoers sick of ballooning ticket prices should have some extra pocket change to rattle with their rock 'n' roll in the new year.
This year was tough for the concert business as high prices kept many fans at home. Promoters now say they plan to make shows more affordable in 2011. But they'll also try to sell more T-shirts and other merchandise to make up for lost revenue.

Heading into last summer, usually the busiest time of the year, prices were set too high despite the sluggish economy. Managers and promoters believed fans would keep paying for the one or two concerts they see on average each year.

Instead, many stayed home, and dozens of shows were canceled. Lots of venues filled seats with fire-sale prices.

Now, rather than charge lots early and offer discounts later, some promoters say they'll offer cheaper tickets from the start, partly because they know fans will spend as much as usual on beer and tchotchkes when they arrive.

ZZ Top, for one, expects to set prices below the 2010 average of $55. Some tickets will go for as little as $10.

"It's time to give the value back," said Carl Stubner, manager of the long-bearded rock band from Texas. "We'll find other ways to make money."

That doesn't mean all acts will be cheap — not even Cheap Trick, whose tickets for 2011 are selling for around $80 with fees. Fans of hot performers including Justin Bieber and Lady Gaga also shouldn't expect to get much of a break.

Neil Diamond, for instance, who's continuing his comeback tour in New Zealand in February, said he'd like to bring ticket prices down but can't because of the size of his production.

"As the shows get bigger, the expenses get bigger, so it's got to be translated somehow to the ticket price," he told The Associated Press. "If I just used the guitar, it'd be a lot simpler, but then I'd have to put 50 people out of work."

More artists than ever are going out on the road to make up for falling CD sales. With more tickets on sale and consumers still pinching pennies, the pressure on prices is down.

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For UPS' peak shipping day, growth forecast is optimistic

NEW YORK — For UPS, it's beginning to look a lot like a normal Christmas.
Wednesday was forecast to be the busiest day of the year for the world's largest package delivery company. It expected to deliver a record 24 million shipments worldwide in 24 hours. That is 9 percent higher than last year and 2007 — the year before the recession took hold. It's 60 percent higher than a normal day.

The glowing forecast for holiday shipping continues a trend of higher revenue and shipping volume for UPS during the first nine months of the year. U.S daily package volume improved by almost 2 percent, while international volume rose more than 17 percent.

In the U.S., after two lackluster holiday seasons, consumers are shopping and shipping again. Much of it is online, where they're spending more than ever. As of Friday, shoppers have spent $27.46 billion online since Nov. 1, up 12 percent from last year, according to research firm comScore Inc. Online holiday sales rose just 5 percent between 2008 and 2009.

Retail experts predict holiday spending will increase by two to four percent over last year.

FedEx grew, too

UPS' smaller rival, FedEx, had its busiest day last week, when the company predicted it would pick up a record 16 million shipments on Dec. 13. That's up 13 percent from last year and double that of a normal day.

FedEx defines its busiest day in terms of shipment pick-ups, while UPS marks its busiest day by number of deliveries.

FedEx, based in Memphis, expects to deliver more than 223 million shipments worldwide this holiday season. UPS forecast double that number.

Most deliveries on UPS' busiest day will come from online retailers such as Amazon.com. The items shipped most often through UPS and FedEx this year include books, clothes and personal electronics such as iPads and smart phones.

The companies are also benefiting from rising imports of computers and other technology gadgets being ordered by businesses.

Jeff Kauffman, an analyst with research firm Sterne Agee, says that the holiday shipping predictions by UPS and FedEx suggest the economy is faring better than most believe.

Last year UPS estimated that 22 million packages were delivered on its busiest day, about the same as in 2007. UPS and FedEx did not offer holiday shipping predictions in 2008, when the recession hit.

UPS, based in Atlanta, hired about 50,000 part-time workers to help with the holiday rush. That's the same as last year.

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UPS to hire 50,000 temporary workers for holidaysReal Estate Outlook: Small Gains

More homeowners drop out of mortgage-relief program

WASHINGTON — More troubled homeowners are dropping out of the Obama administration's main foreclosure-relief program, which has been widely criticized for failing to help more people keep their homes.
The Treasury Department said Wednesday that about 774,000 homeowners have dropped out as of last month. That's about 54 percent of the more than 1.4 million people who applied. And it's up from October, when approximately 756,000 had fallen out.

The program is intended to help those at risk of foreclosure by lowering their monthly payments. Borrowers start with lower payments on a trial basis. The program has struggled to convert them into permanent loan modifications.

An additional 505,000 homeowners have secured lower payments permanently. That's about 35 percent of the number who enrolled on a trial basis, up slightly from October's reading.

However, the program reached more homeowners in November than in October. The number of new trial modifications increased to about 30,000, up from about 24,000 in October. And the number of trial modifications that turned permanent rose to about 31,000, up from about 26,000.

Foreclosure filings fell by 21 percent last month, their largest monthly decrease since 2005. However, the government warned that the decrease likely probably be temporary. Lenders are expected to revise and resubmit paperwork in the coming months.

Several major mortgage companies halted foreclosures this fall after acknowledging that they might have mishandled court papers.

Homeowners applying to the foreclosure-relief program say the program is a bureaucratic mess, with banks losing documents and failing to return phone calls. Banks blame homeowners for failing to submit needed paperwork.

Homeowners accepted into the program can receive interest rates as low as 2 percent for five years and can repay their loans over a longer period. Those who remain in the program see their monthly payments cut on average by about $500.

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Nashville area’s median home price is highest in 2 yearsUnderwater? Alternatives to Walking Away

Shoppers crowd stores as season winds down

Holiday shoppers are racing to the end of the Christmas season at a more feverish pace this year on foot and online.
U.S. retail revenue was up 5.5 percent on Friday through Monday — the last full weekend before Christmas Day arrives, according to the ShopperTrak research firm.

ShopperTrak said Wednesday that retail sales over the Dec. 17-19 weekend accounted for $18.83 billion in consumer spending, with more than one-third of that occurring on Saturday alone.

Some Nashville boutique-style retailers say they also have seen increases in their online sales, and that has boosted their optimism.

RelatedBeware: Return policies vary widely

"We've gotten people we would never have seen as customers in our store," said Ashley Tomichek, owner of Corzine & Co., whose offerings include china, home accessories, baby gifts, antique tableware and stationery. "But online pretty much wrapped up last week, and the only last-minute shoppers we're seeing now are the ones coming into our store."

Elizabeth Nichols, chief executive of Taigan.com, a Nashville-based virtual shopping site for boutiques, said orders on its 1-year-old website, which includes more than 80 specialty retailers, have been robust. "I hope it's a sign that the economy is improving," she said.

The Nashville pet accessories store known as "Come.Sit.Stay" didn't have a Web presence last year but has done a booming business online using the Taigan virtual mall so far this year, including "phenomenal sales in November and December," owner Robin Cohn said.

"This gives me a whole new audience," Cohn said. "It started slowly, but now it's really growing, and 99 percent of the online sales are going out of state. It's the icing on the cake for us."

This year's apparent improvement in holiday sales is especially encouraging for retailers.

ShopperTrak expects retail spending to rise 4 percent for the holiday season nationally. It fell 0.4 percent during the 2009 season. Anything over 4 percent is considered a healthy gain.

Nashville malls crowded

The final days leading up to Christmas are important for retailers, and crowds at malls in the Nashville area seemed to be picking up.

On Wednesday, shoppers crowded Cool Springs Galleria at midday, and some shoppers said it was hard to drive to the mall because of congested traffic.

"I like last-minute shopping, but I don't like it enough to come back here on Christmas Eve and fight this traffic again," said Brentwood resident Jean Rich, resting on a bench at the Cool Springs mall in the early afternoon.

Recent data from MasterCard Advisors' SpendingPulse, which tracks spending across all transactions including cash, shows Americans were spending more on clothing, luxury goods and even furniture during the period from Oct. 31 through Saturday.

Online spending also has been strong. As of Friday, shoppers have spent $27.46 billion online since Nov. 1, up 12 percent from a year ago, according to research firm comScore Inc.

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Real Estate Outlook: Small GainsValue remains important for Christmas shoppers

Tuesday, December 14, 2010

Dell to buy Compellent for $27.75 a share

SAN FRANCISCO — Dell Inc. said Monday that it is buying Compellent Technologies Inc. for $27.75 a share in cash in the latest data-storage acquisition by a big tech-sector player, highlighting the growing importance of cloud computing.
Shares of Dell fell nearly 4 percent to close at $13.36. Compellent lost 2.5 percent to close at $27.98, although the stock has risen more than 50 percent as speculation has grown that it was one of several potential acquisition targets in the data-storage space.

Dell had disclosed the negotiations with Compellent last week, including a proposed sale price of $27.50 a share, a move that some analysts said may have been aimed at tempering market expectations for a higher deal value.

Texas-based Dell put the final deal's total equity value at about $960 million and the aggregate purchase price at about $820 million, net of Compellent's cash.

The companies said they expect the deal to close in early 2011.

Dell had been looking to expand its data-storage port folio to become more competitive in the corporate technology market. Earlier this year, it lost a bidding war with rival Hewlett-Packard for 3Par Inc.

The 3Par bidding war triggered a rise in the shares of data-storage companies as Wall Street anticipated the wave of data-storage mergers to continue. Compellent shares have soared more than 130 percent since mid-August.

The focus on data storage was based largely on the push toward cloud computing, which lets companies tap computing power through a network instead of in-house data centers.

'Higher margins'

Wedbush analyst Kau shik Roy said the Compellent deal gives Dell "a product that is much higher margins than what they sell — PCs and servers."

"They are building their own storage product portfolio, which from Dell's standpoint (is) the right to do," he said by e-mail.

But analysts also said the deal could harm Dell's ties to data-storage giant EMC Corp.

"We think the Compellent deal will cause further strain on the EMC relationship," Wells Fargo analyst Jason Maynard said in a note. "However, Dell still has product holes in the high-end storage and deduplication markets, so we think there is room for Dell to continue to resell EMC VMAX and Data Domain."

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Real Estate Outlook: Small GainsFirst Horizon turns profit in third quarter

92 jobs cut in Lebanon, Murfreesboro

Layoffs at two companies in Lebanon and Murfreesboro, affecting 92 workers, were reported Monday by the state Department of Labor and Workforce Development.
Menlo Worldwide Logistics, a division of the California-based Con-Way Inc., said it would furlough 68 employees as it closes a warehouse in Lebanon that it operates on behalf of Nortel Networks, which earlier this year was taken over by Avaya Inc., after Nortel filed bankruptcy.

Avaya is moving the operations of the Lebanon facility to another warehouse in Memphis, said Con-Way spokesman Gary Frantz.

Most of the displaced Menlo workers will leave the company Jan. 4, he said, adding that they are being offered severance and outplacement services.

B&W Wholesale Distributors, which provides candy, tobacco, and health and beauty products to supermarkets and convenience stores in a multi-state area, will trim 25 workers beginning Friday, the Labor Department said.

The company's website says it has about 100 employees now.

B&W Chief Operating Officer John Smith, reached by phone, said he had no knowledge of the layoffs, and several other company officers, also contacted by phone, declined to confirm or comment.

Contact Tennessean business writer G. Chambers Williams III at 615-259-8076 or cwilliams1@tennessean.com.

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Managing SoloLaid-off workers pick up hot skills

First Horizon moves to pay bailout debt

First Horizon, the parent company of First Tennessee Bank, is taking steps to begin repaying more than $866 million in federal bailout aid it received indirectly from taxpayers and directly from the U.S. Treasury two years ago.
The bank said Monday it plans to sell $250 million in common stock to help repay federal funds it had borrowed as the financial crisis mounted.

First Tennessee's parent, a major player in retail banking in Nashville and statewide, said it would combine the proceeds of the equity offering with net proceeds of a planned debt offering to repurchase all 866,540 shares of preferred stock it sold to the U.S. Treasury in November 2008.

The deal still needs approval of the Treasury.

The Treasury borrowing was part of First Horizon's participation in the Capital Purchase Program, part of the government's Troubled Asset Relief Program that was instituted during the financial crisis.

First Horizon borrowed $866.5 million in TARP funds.

Moving to repay the money could be a sign that regional banks are seeing light ahead after many quarters of loan losses and weak loan demand.

First Horizon's stock edged higher on the news, rising 3.7 percent to close at $10.92 a share on the New York Stock Exchange.

But another regional bank, based in Columbus, Ohio, saw its stock slide when some analysts questioned whether its plan to repay the federal government $1.4 billion in bailout funds was premature.

Huntington shares fall

Huntington Bancshares, which trades on Nasdaq, could be in danger of diluting its stock by issuing more shares to repay the federal treasury, at least one bank analyst said.

The Ohio bank's offering comes as shares of Huntington have surged in 2010, but analysts questioned the timing and size of its stock offering. Its share price is up 87 percent this year, and 19 percent in the fourth quarter alone.

Huntington said it also planned an offering of $300 million in subordinated debt to cover the remainder of its bailout repayment.

"Two quarters from now, could they have waited and gotten a better deal? Probably," said Morgan Keegan & Co. analyst Bob Patten. "But the stock has performed well, and this gets them out from under the government and back into being a buyer for small, troubled banks in the Midwest."

Huntington's stock offering will cover nearly two-thirds of its government repayment obligation, but will increase outstanding shares by 19 percent, diluting the value of stock, analyst Erik Oja of Standard & Poor's said in a research note.

The rating agency cut its recommendation from "buy" to "hold" for Huntington's stock.

Huntington's shares fell 2.7 percent in value on Nasdaq on Monday.

Tennessean Business Editor Randy McClain and Bloomberg News contributed to this story.

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Sunday, December 5, 2010

Cracker Barrel will have electric-car chargers at 24 stores

The Cracker Barrel Old Country Store chain said today that it would install 30-minute electric-vehicle chargers for customers to use at 24 of its locations in Middle and East Tennessee over the next year.
Of the 24 locations, 12 have already been identified, and include stores along the Interstate 40, 24 and 75 corridors between Knoxville, Chattanooga and Nashville.
In Nashville, there will be chargers at the Cracker Barrel on Stewart’s Ferry Pike.

Elsewhere in Middle Tennessee, chargers will be at the company’s stores in Lebanon, Murfreesboro, Manchester, Cookeville and Crossville.

Cracker Barrel said the other 12 locations would be in and around Nashville, Knoxville and Chattanooga to serve mostly local users, rather than those driving longer distances on the interstates.

The chargers will allow drivers of electric vehicles such as the new Nissan Leaf to recharge their vehicles’ batteries in about a half-hour – while shopping or dining in the Cracker Barrel stores.

Plans call for installation of the chargers to begin in the spring, and to be completed within a few months.

Putting chargers in public locations is part of the rollout of the Leaf, which goes on sale sometime in December in Tennessee and four other states.

The Leaf has a range of about 100 miles between charges, and Cracker Barrel said its chargers would be located strategically so people could drive the cars the entire 425-mile triangle of interstate highways between the three cities by stopping at the stores along the way for recharging.

Contact Tennessean automotive writer G. Chambers Williams III at 615-259-8076 or cwilliams1@tennessean.com.

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Scripps TV unit to relocate HQ to KnoxvilleBuyers Interested in Walkability

Take Part: Are you about to exhaust your unemployment benefits?

Jobless benefits may end for more citizens
Are you about to exhaust your unemployment benefits after 99 weeks? Contact Tennessean business reporter Naomi Snyder at 615-259-8284 or nsnyder@tennessean.com. Please leave your name and contact information for a news story about federal aid running out for more unemployed workers even after extensions that boosted some people's aid to nearly two years.

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Jobless benefits extension is mired in political bickeringReal Estate Outlook: Small Gains

Many life insurance claims are denied

LOS ANGELES — American General Life Insurance Co. markets its policies as protection for "the hopes and dreams of American families" — a promise Ian Weissberger took to heart during his losing battle with Lou Gehrig's disease.
But after the Cathedral City, Calif., mortgage broker died in 2005, American General canceled his life insurance policy and refused to pay his widow the $250,000 benefit.

The Weissbergers' premiums were paid up. No foul play was suspected. There was no question Sheila Weissberger was the widow and sole beneficiary. And Ian's illness was diagnosed months after he took out the policy.

The problem, the insurer told Sheila Weissberger, was that Ian's application for coverage was incomplete.

American General concluded that he had failed to disclose conditions, including bipolar disorder and pulmonary disease, that, according to his doctors, he did not have.

For the company, which collected $2.3 billion in premiums last year, the amount at issue was minute. But it was no small matter for Sheila, 62, who reached a confidential financial settlement with American General earlier this year.

"I lost my house. I lost everything," she said in an interview. "It was very, very devastating."

More often than not, life insurers make good on policies, paying $38 billion in death benefits on individual policies last year. But what happened to Sheila Weissberger was not unusual. The claims of thousands of beneficiaries are denied or disputed every year — more than 5,000 last year alone — many for allegedly flawed applications, a Los Angeles Times review found.

Overall, the amount of money that life insurers withheld from beneficiaries has more than doubled over the past decade, to $372 million last year, even as policy sales went down, according to a Times analysis of data compiled by the National Association of Insurance Commissioners.

Disclosure is often issue

Insurers can dispute claims for a number of legitimate reasons: unpaid premiums, suicide, foul play by the beneficiary. But the No. 1 reason, accounting for about two-thirds of disputes last year, is "material misrepresentation." That's failing to disclose information that insurers deem important in assessing risk, and it allows insurers to rescind coverage altogether.

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