Archive for February, 2009

“Why We Buy” Part 1

I’ve been meaning to start placing my favorite quotes from Paco Underhill’s “Why We Buy” but have not had the time. This is the first in a several part series. Enjoy:

“We can tell you how many males who take jeans into the fitting room will buy them compared to how many females (65 percent to 25 percent).” pg. 17

“The butt-brush factor, we wurmised, was why that rack was an underperformer.” pg. 18

“Shoppers have been spooked by too-close quarters.” pg. 18

“Move the treats to where kids and little old ladies can reach them.” pg. 19

“Much of the signage was misplaced–common sense dictated that it be positioned to face the main entrance of the store, but we found that most jeans shoppers came upon the section from a completely different direction.” pg. 20

“My old colleagues in the world of academia regard what we do with envy and horror–envy because we get to do what we do and get paid for it, horror because we actually stick our necks out and are held accountable for the success or failure of our suggestions.” pg. 21

“Why not take the tools of the urban anthropologist and use them to study how people interact with the retail environment?” pg. 24

“To my surprise things that seemed logical and obvious to me were delightful insights to my clients. It was clear that I had stepped into a world of business where what I did had value, but I knew nothing of the consequences or, really the context.” pg. 27

“…the view from the register back into the body of the store is distinctly myopic.” pg. 28

“A store has more than one constituency, and it must therefore perform several functions, all from the same premises.” pg. 29

“If we went into stores only when we needed to buy something, and if once there we bought only what we needed, the economy would collapse, boom.” pg. 31

“…we are now generously overretailed–too much is for sale, through too many outlets. The economy even at its strongest can’t keep up with retailing’s growth. Judging from birthrates, we are generating stores considerably faster than we are producing new baby shoppers. Retailers are not opening stores in the United States to serve new markets anymore. They are opening stores to try to steal someone else’s customers. As the competition gets heated, there is a need for an edge–a science, if you will.” pg. 31

“The standard tools of marketing work, they just don’t work anywhere near as well as they used to. Many purchasing decisions are made, or can be heavily influenced, on the floor of the store itself. Shoppers are susceptible to impressions and information they acquire in stores, rather than just relying on brand-name loyalty or advertising to tell them what to buy. As a result, an important medium for transmitting messages and closing sales is now the store and the aisle. That building, that place, has become a great big three-dimensional advertisement for itself. Signage, shelf position, display space and special fixtures all make it either likelier or less likely that a shopper will buy a particular item (or any item at all).” pg. 32

“Finally, our studies prove that the longer a shopper remains in a store, the more he or she will buy. And the amount of time a shopper spends in a store depends on how comfortable and enjoyable the experience is.” pg. 33

“Marketing, advertising, promotion and location can bring shoppers in, but then it’s the job of the merchandise, the employees and the store itself to turn them into buyers. Conversion rate measures what you make of what you have–it shows how well (or how poorly) the entire enterprise is functioning where it counts most: in the store. Conversion rate is to retail what batting average is to baseball–without knowing it, you can say that somebody had a hundred hits last season, but if you don’t know whether he had three hundred at-bats or a thousand. Without conversion rate, you don’t know if you’re Mickey Mantle or Mickey Mouse.” pg. 36

“The average shopper spent two minutes in the cosmetics section. The average shopper who bought something spent only thirty seconds more. Now, the amount of time a shopper spends in a store (assuming he or she is shopping, not waiting in a line) is perhaps the single most important factor in determinging how much she or he will buy. Over and over again, our studies have shown a direct relationship. If the customer is walking through the entire store (or most of it, at least) and is considering lots of merchandise (meaning he or she is looking and touching and thinking), a fair amount of time is required…” pg. 37

“Here’s another good way to judge a store: by its interception rate, meaning the percentage of customers who have some contact with an employee…All our research shows this direct relationship: the more shopper-employe contacts that take place, the greater the average sale. Talking with an employee has a way of drawing a cusotmer in closer.” pg. 37

“Here’s a finaly measure, a real simple one waiting time. This, as we discuss elsewhere, is the single most important factor in customer satisfaction. But few retailers realize that when shoppers are made to wait too long in line (or anywhere else), their impression of overall service plunges.” pg. 38

“This finaly matter doesn’t involve any particular way to measure a store, but it’s a remarkable example of businessperson ignorance: they often don’t really know who their shoppers are.” pg. 39

“Smart retailers would reward employees who learned a little Japanese, German, French or Spanish–even just a handful of phrases would make a difference, as anyone who has shopped in a foreign country would realize. Restaurants should have menus in Japanese and German on hand.” pg. 39 ( I might ad, what about the digital signage?).

stay tuned for more coming up….

 

I.O.U.S.A., An Eye Opening Video

 

Stocks: What and When?

Much of my information here, I gleaned from a recent lecture given by Ned C. Hill, former dean of the Marriott School of Management. In my spare time, I have been reading profusely on various topics, stocks being only one. Market fluctuation and stock market advice are issues that concern not only those in the signage industry, but the nation as a whole. What do we do with the massive cyclical movements in the market? How can we invest wisely and confidently in our industry? Isn’t our industry poised for growth this year? If so, how can I best take advantage of that during the current declining crisis?

In most cases, we need to wait it out, like bursting a boil. You cannot rush certain things. Patience for a bounce-back is absolutely necessary. However, too much reticence for risk will retard your return. I consider myself a skeptical optimist which is why I adhere to the Joseph Kennedy style for investing: when my shoeshine boy starts telling me which stocks to buy, I know it’s time to get out of stocks. I may not be an expert, but I hope the following statistical information will help you as you decide where to put your money in the coming months and years. 

When 

The first question is when to buy. Let’s first examine some numerical data. 

  • The greatest return ever in the overall market happened from May of 1932 to April of 1937. The return? 367% !
  • The second greatest return in the market was witnessed from July of 1982 to June of 1987. Not as high, but still a whopping 267% return! 
Can you pick up the trend? If not, you need to know your history a bit. Both of those fueled returns came just following two of our nation’s largest recessions. Coincidence? Hardly. Correlation? Absolutely. It may be as simple as buy low, sell high. That being said, it may be wise to take advantage of the downward cycles in pricing recently. 

What 

Determining which stocks to purchase is the most difficult part. This requires skeptical analysis of financial statements. Which I could do for you, but then you would have to blame me for any losses, which I certainly don’t want. Instead, I’m going to give my generalized advice in a “process of negation” form. That is, I’m not going to suggest what to purchase, but I’m going to suggest what not to purchase. It’s about as easy to lead someone into a mistake as it is to lead them away from one. Success? Well, that’s an entirely different topic. 

Wireless Ronin and Broadsign are two companies who’re currently bleeding. Both are bleeding out the nose right now. Although recent developments at Broadsign look promising  (namely agreements with Ingram Micro and a new leader in Dusho), my conclusion is still not to purchase yet. Take a lookat their most recent financial statements, including all their important ratios. It’s not looking too good. At least Wireless Ronin has been cutting back, but that may just be a last ditch effort toward survival. 

Perhaps, Hughes (owner of Helius), Scala, and 3M would be decent purchases as we continue to see growth this year. You’ll have to look into their financials on your own time, as it would require a much longer discussion here. 

Some Great Books to Read on the Subject

  • Tyson, Personal Finance for Dummies, 4th Edition (just because it says, “for dummies” doesn’t mean that it’s for “dummies only” :)
  • Engel and Hecht, How to Buy Stocks, 8th Edition (I read the 7th edition, but I’m sure the 8th is much better)
  • Lynch and RothchildLearn to Earn
  • Jane Bryant Quinn, Making the Most of Your Money
  • Stanley and DankoThe Millionaire Next Door (a undeniable “classic”) 

I am a stong proponent of the entrepreneurial spirit of American. In fact, most of American jobs are not administered by the large, publicly traded enterprises, but by local and regional thriving businesses. Productivity increases, fueled by technology, have been huge contributors to aiding in the growth of our economy. Think about this statistic: the growth of the U.S. economy from 2002 to 2007 exceeded that of the entire Chinese economy. Our capitalist approach of low tax rates, innovation and personal drive and commitment have taken us to our current status. 

 

 

Details and Breakdown of the Barack Obama Economic Stimulus Plan

The House Committee on Appropriations released a run-down of what will most likely be included in the American Recovery and Reinvestment Bill of 2009.The bill will contain $275 billion in economic recovery tax cuts and $550 billion in thoughtful and carefully targeted priority investments withunprecedented accountability measures built in.The various spending programs total only $518.7billion. So they’re, you know, just $31.3 billion short.

Breakdown Of The Package For various Catagories as Below:

Energy:

$32 billion: Funding for “smart electricity grid” to reduce waste
$16 billion: Renewable energy tax cuts and a tax credit for research and development on energy-related work, and a multiyear extension of renewable energy production tax credit
$6 billion: Funding to weatherize modest-income homes

Science and Technology:

$10 billion: Science facilities.
$6 billion: High-speed Internet access for rural and underserved areas.

Infrastructure:

$30 billion: Transportation projects
$31 billion: Construction and repair of federal buildings and other public infrastructure
$19 billion: Water projects
$10 billion: Rail and mass transit projects

Education:

$41 billion: Grants to local school districts
$79 billion: State fiscal relief to prevent cuts in state aid
$21 billion: School modernization ($15.6 billion to increase the Pell grant by $500; $6 billion for higher education modernization)

Health Care:

$39 billion: Subsidies to health insurance for unemployed; providing coverage through Medicaid
$87 billion: Help to states with Medicaid
$20 billion: Modernization of health-information technology systems
$4.1 billion: Preventative care

Jobless Benefits:

$43 billion for increased unemployment benefits and job training.
$39 billion to support those who lose their jobs by helping them to pay the cost of keeping their employer provided healthcare under COBRA and providing short-term options to be covered by Medicaid.
$20 billion to increase the food stamp benefit by over 13% in order to help defray rising food costs.

original post can be found at the following link:

http://www.24timepass.com/education/obamas-stimulus-package-breakdown-report.htm