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Focus on: Energy Management

BY Marianne Wilson

Michaels Stores is taking its energy conservation efforts to the next level. The arts and crafts retailer has rolled out several advanced extensions to its energy management system. The extensions are expected to bring Michaels’ total EMS-related savings to more than 30%.

Michaels deployed its present energy management system — Site Controls, from Siemens Building Technologies Division — in 2006. Since installing the system, the chain has seen substantial reductions in energy consumption across its fleet of more than 1,000 Michaels stores.

“Energy is our second highest store-level line item expense behind labor,” said Robin Moore, VP store development and construction, Michaels Stores, Irving, Texas. “Through regular KPI (key performance indicator) reviews and process improvements provided by Siemens’ Client Services team, we have been able to sustain and increase our energy savings over time, and these new extensions will take those savings even further.”

Prior to rolling out the new capabilities, Michaels undertook a thorough system analysis after a 30-site pilot and subsequent 200-site expansion. The pilots were followed up with a comprehensive measurement and verification study, which validated the savings delivered.

The new extensions include the deployment of Siemens’ Intelligent Demand Control Ventilation, which allows retailers to reduce energy consumption by automatically controlling the amount of outside air intake based on the occupancy of each store without expensive hardware retrofits. Psychrometric controls, which dynamically adjust temperature set points to factor in both temperature and humidity while maintaining customer comfort, have also been deployed.

In addition, lighting automation upgrades have been rolled out. The upgrades enable more precise controls of lighting circuits, such as stocking zones and employee areas.

“Some of the software extensions, such as Psychrometric controls and Intelligent Demand Control Ventilation, can be deployed remotely, while the lighting automation upgrades require a Siemens crew to visit each store,” Moore said. (The rollout was due to be completed by press time.)

In addition to existing locations, the energy-saving features are being specified for new construction.

“The new extensions are now included in the design of the EMS package deployed with each new Michaels location,” Moore added.

What does Michaels think will be the biggest advantage of the extensions?

“It’s all about energy savings and ROI,” Moore explained. “We expect these savings will bring total EMS-related savings to more than 30% without negatively impacting shopping conditions or customer comfort.”

The new capabilities have a cash-on-cash payback of 20 months, and an ROI exceeding 90%, according to Siemens. The investment will also drive further reductions in Michaels’ footprint to the equivalent of removing 5,600 cars from the road annually.

While Michaels is already reaping significant savings, the chain believes even more opportunities exist.

“We definitely believe there are opportunities, and we are always willing to evaluate and deploy the ones that demonstrate savings,” Moore said. “Certainly the energy savings yielded to date are a home run. But job No. 1 is to maintain these savings over time — and we have institutionalized the operating processes and KPI reviews necessary to do this.”

Moore added that one of the great benefits of Michaels’ partnership with Siemens is the supplier’s history of bringing the retailer continuous technology enhancements.

“That makes us confident we will create even more savings opportunities in the future,” Moore said.

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P.Lopez says:
Apr-01-2013 08:01 pm

The industry has dithered about adding doors to dairy, beer, lunch meat and bagged salad and other medium temperature coolers for years. ChatRandom

J.Hams says:
Mar-30-2013 06:47 am

. But most importantly, they will be able to back up their sustainability message with actions that truly make a difference. AodhfionnAonghus

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Focus on: Gift Cards

BY Phillip M. Perry

Retailers looking to add sparkle to this year’s Christmas season may want to take a new look at their gift card programs. Last year, more than half of consumers bought at least one gift card for the holidays, according to a report from First Data Corp., an Atlanta-based e-commerce processor.

Indeed, consumers seem to be taking more of a shine than ever to these types of spending vehicles.

“The average value of a closed loop card purchased in 2011 rose more than 23% year over year, from $34 in 2010 to $42 in 2011,” according to the First Data report. (A closed loop card can be used only at a specific store. An open look card, issued by credit card providers, such as Visa and American Express, can be used at any store).

The reason for consumer interest? Choice: Sixty-five percent of participants in a First Data survey said they valued the ability to select their own gifts.

“More than half of consumers would prefer to receive a $25 gift card than a gift valued at $45,” according to the report.

The message for retailers: Launching a new program or fine-tuning an existing one might pay off. Here are some tactics to consider:

• Go virtual. “Offer e-gift cards where possible,” suggested Shelley Hunter, a San Francisco-based gift card consultant. “The ability to send a gift from your phone gives the customer a way to quickly take care of last-minute gifts.”

Indeed, a report by digital gift card company Giftango Corp. noted that fulfillment of a gift card purchased from a retailer’s website generally takes three to five days from time of order to mailbox delivery, with the time frame even longer the week prior to Christmas. The report, “A Case for Digital Gift Cards: eGift Cards Turn Slowest Gift Card Sales Days into Busiest for Retailers,” found that gift card sales decline dramatically starting nearly two weeks before the gifting event.

However, this trend is reversed when instant digital delivery is presented as an option, according to the report. It found that the highest gift card sales days for retailers that offered both delivery options was Dec. 19, a full week later than the highest sales days for retailers that offered only plastic delivery.

• Incentivize the staff. “Reward store personnel who make gift card sales,” suggested Bob Phibbs, a retail consultant based in Coxsackie, N.Y. “Individuals on a commissioned sales team usually only get credit when gift cards are used, which can lessen efforts to sell them.”

• Liberalize return policies. If the recipient of a gift card buys something they end up not liking, will you refund their purchase or only issue a new gift card? You might prefer the latter option, but it can disappoint your customer. “You don’t want your employees angering customers about what the store can’t do with a gift card,” Phibbs noted.

• Encourage reloading. Only 9% of consumers reloaded a gift card they’d bought or received in the past year, according to First Data. Punch up that figure by offering cash bonuses or free items each time a customer adds cash to a card.

• Offer gift card substitution. Is a certain item out of stock? Post a “purchase gift card instead” sign at the in-store display, or on your website catalog. Train all the staff to offer gift cards when items are stocked out.

• Add value. Many people still hesitate to purchase gift cards, looking upon them as cold and impersonal. Warm things up by offering exciting combinations of cards and small merchandise items, Hunter suggested.

“Customers quickly catch the vision that adding a little something to the gift card turns otherwise impersonal plastic into a thoughtful act,” Hunter said. “Keep ribbon on hand to encourage the upsell.”

• Reward givers. Offer gift card buyers an incentive, suggested Hunter. “For example, customers who buy a $50 gift card might receive a $10 coupon toward their next purchase.”

Phillip M. Perry is a New York City-based business writer.

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P.Lopez says:
Apr-01-2013 08:01 pm

ChatRandom
Turn Slowest Gift Card Sales Days into Busiest for Retailers,” found that gift card sales decline dramatically starting nearly two weeks before the gifting event. ChatRandom

P.Lopez says:
Apr-01-2013 08:01 pm

Turn Slowest Gift Card Sales Days into Busiest for Retailers,” found that gift card sales decline dramatically starting nearly two weeks before the gifting event. ChatRandom

J.Hams says:
Mar-30-2013 06:48 am

suggested Hunter. “For
suggested Hunter. “For example, customers who buy a $50 gift card might receive a $10 coupon toward their next purchase.” Barry

J.Hams says:
Mar-30-2013 06:48 am

suggested Hunter. “For example, customers who buy a $50 gift card might receive a $10 coupon toward their next purchase.” Barry

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Navigating a Social Media World

BY CSA STAFF

With more and more consumers accessing social network sites to gather input and post reviews, Chain Store Age spoke with Dick Reed, CEO of Just Media, on a subject that is a top priority for retailers across the board: how to reach out to consumers in today’s social media world.

Your company has done some detailed research on how consumers make buying decisions in today’s social media world. Tell us about it.

We ran an online survey to discover what information sources were being referred to when regular consumers considered the purchase of a technology product. Our objective was to discover what sources they use and which are the most important and influential.

We did this to help a client understand the purchase process because, while we had run a successful advertising campaign (in terms of response and interest) promoting one of their products, there had been a lack of conversion to actual sales. Our belief was that other factors were impacting this conversion, most notably some poor user review scores that appeared on various e-store websites.

We believe that the response data we collected is quite representative of purchase processes for many general product categories given the overwhelming access the general population has to information through smartphones, computer and tablets.

How important are online reviews?

They are critical. Cumulatively, 73% of respondents claimed online user reviews were “critical, I always check this” (23%), or “an important part of decision” (50%). Professional reviews came in second, at 70% overall. Compare this, however, with feedback from in-store sales person at only 19%, or manufacturers’ own reviews at 22%.

Should retailers ignore negative comments?

Generally speaking, retailers are ill-advised to ignore complaints since the impact of the negative comments is obviously quite severe. Put emotion and hurt to one side, take a deep breath and respond professionally. Remember, even when he or she is not, the customer is always right!

More importantly, user feedback offers the retailers or manufacturers an opportunity to see where they may be falling short in terms of service, and to address the issue before it impacts on their business long term.

Many retailers seem uncertain when it comes to the thrust of their social media strategy. What should their focus be?

One of the most interesting responses we saw in the survey — and certainly the one that surprised us the most — was that users are not giving much credit to opinions posted in social networks like Facebook and Twitter. They much prefer user reviews posted on sites where they actually buy, such as Amazon.

We suspect this is because random comments in social networks are less in context with regard to others, so it’s hard to get a good overall picture. Users know that a few negative comments are always likely, and it’s a question of how the negatives compare with the positives.

Given this, we advise clients to focus on helping purchasers who like their products become advocates for them by posting where it matters, at the point of purchase, or where many user reviews are gathered like on a product review site. Facebook pages might be nice to get fans and share and build communities, but it’s not necessarily going to help those new prospects become a buyer.

Is online advertising on social media sites an effective strategy for retailers?

Yes, we have found social sites to be good areas for online campaigns, which perform as well if not better than many other types of online sites.

Summing up, how should retailers reach out to consumers in today’s social world?

Never underestimate the power of user reviews, and encourage your social community to actively help by becoming advocates. Do not ignore negative comments, and if you have a product that users really don’t like, refrain from using marketing to try and drive the sales … all you do is actually damage the brand by directing people to all the negativity. Indeed, it actually makes sense now to advertise the products people love the most to help boost the brand and encourage even more positivity.

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J.Jannp says:
Dec-19-2012 05:57 am

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J.Jannp says:
Dec-19-2012 05:57 am

sentiment and harm to one face, take a profound gasp and react proficiently. memorize, even while he or she is not love wallpapers, the client is forever true romantic photos.

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