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Shoplifting at American Apparel? Think twice.

February 20, 2012

Thieving hipsters, take note.

 

American Apparel will be tagging every neon legging, velvet bodysuit, V-neck t-shirt and iconic hoodie with an RFID sensor, the RFID Journal reports. The sensors will track items from the time they are shipped from American Apparel’s factory in downtown L.A. to when a customer purchases the item from one of its 280 stores, helping the chain to keep better track of inventory and disappearances.

 

Since entering the retail market in 2003, American Apparel has succeeded wildly by imparting its cotton basics with alternative appeal. The company supports progressive issues like gay rights, pays factory workers $12 to $14 per hour -- far above minimum wage -- and regularly incites the uptight with skin-filled ads.

 

Yet American Apparel has long been targeted by shoplifters, many of them indistinguishable from the chain's loyal customers. The company's stores initially lacked anti-theft sensors, inciting a series of plunders whose history is documented on various Facebook groups and blogs. Former employees allege that in its early years, American Apparel had a pro-shoplifting policy, explicitly asking managers to turn a blind eye so that the right type of person would have easier access to the clothes and become an unwitting spokesperson for the brand.

 

Whether or not these claims prove true, the fact that the company has made its money by catering to rebellious,anti-corporate youth has infuriated more than a few members of its target market. Arguably, shoplifting from the store was a way for some to subvert the commercialization of counter-culture. Free clothes were, naturally, a perk.

 

"This is a true story about stealing from a corporation," Tao Lin wrote in the Vice Magazine story that inspired his 2009 novella, Shoplifting from American Apparel. "American Apparel is a corporation. ... Don’t hate me for stealing from an independent clothing company, because then you'd be basing your hatred on something that isn’t real."

 

Of course, irony-tinged theft is a bad thing for any company, "independent" or otherwise. As American Apparel expanded, opening 133 stores between 2007 and today, it equipped its locations with EAS (Electronic Article Surveillence) devices, or those hard plastic sensors that get removed at cash registers. In 2007, it launched a pilot program that tested the more sophisticated RFID (Radio Frequency Identification) tags, which track the movement of each item and help prevent merchandise from getting stolen internally, by employees.

 

In stores with both kinds of sensors, "shrinkage," or the number of items that mysteriously disappear between a factory and a store, has dropped as much as 75 percent, Stacey Shulman, American Apparel's VP of technology told the RFID Journal in April 2011.

 

Once it finishes installing the devices in every store, American Apparel -- now the largest clothing manufacturer in America -- will also have the second largest network of RFID sensors of any retailer, after Walmart. Other retailers are running trials of RFID, though the technology has yet to become an industry standard.

 

Still, theft is but one item on a long list of business problems for American Apparel. The company teetered on the edge of bankruptcy for much of last year, due to declining sales and falling stock. It is in the process of resolving a lawsuit from a former employee that accuses CEO Dov Charney of sexual harassment.

 

With demand for American Apparel's clothing so low, it's hard not to wonder whether the company longs for the days when attractive thieves flocked to its locations. Whether American Apparel manages to pull itself up will be an interesting test of how long a corporation can continue to sell "cool," when one of the only constants in its shoppers' idea of "cool" is anti-corporate sentiment.

 

For more information, visit: http://www.huffingtonpost.com/2012/02/19/american-apparel-shoplifting_n_1285313.html

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Walmart and China

February 20, 2012

Walmart is taking a 51% stake in Yihaodian, a leading Chinese e-commerce website, in a significant move by the U.S. retailer to boost its online presence in China.

 

Walmart did not disclose financial details for the partnership, which Neil Ashe, president and chief executive of Walmart Global e-commerce, said would help deliver a "superb customer experience" to consumers in China.

 

"This is testament to how seriously Walmart is developing their e-commerce platform in China. Having a controlling stake obviously gives them a much more direct say in how Yihaodian expands," said Torsten Stocker, an analyst with the Monitor Group.

 

Founded in 2008, Yihaodian is one of the fastest growing companies in China, selling more than 180,000 products ranging from grocery items to consumer electronics and apparel. Yihaodian, in which Walmart already held a minority stake, runs logistics centers in Shanghai, Beijing, Guangzhou, Wuhan and Chengdu and is able to offer same-day and next-day delivery. The Chinese consumer e-commerce market is dominated by homegrown online retailer Taobao.

 

Walmart remains a relative novice in e-commerce in the United States where the market is led by Amazon. Online sales account for a tiny percentage of Walmart's total U.S. revenues, but in the past year it has sought to boost its in-house expertise by acquiring two U.S. technology companies: Kosmix, which specializes in organizing information from social media sites such as Facebook, and Small Society, which develops apps for mobile shopping.

 

While Walmart's website sells dried and packaged food as well as general merchandise for delivery across the US, its only involvement in selling fresh food online is a small pilot program launched in San Jose, California, last year.

 

Walmart has more than 350 stores in China, where it has been making steady progress. In the three months to the end of October it reported a 16.1% increase in China sales from the previous year, but although individual shoppers were spending more money on each trip, visitor numbers were down 7.1%.

 

The company this month appointed Greg Foran, a 30-year industry veteran, as the chief executive of its China business. Mr Foran will take over next month. His predecessor, Ed Chan, stepped down in October, the fourth senior-level departure for the China business in six months.

 

In October, Walmart China closed its stores in Chongqing for a fortnight after the local government found it had mislabeled ordinary pork as organic. "Monitoring Walmart is as effective as punching cotton," Tang Chuan, head of enforcement at the Chongqing Administration of Industry and Commerce, told Xinhua news agency at the time.

 

Mr Ashe said that, in addition to helping Walmart's e-commerce goals in China, the increased investment in Yihaodian would "further contribute to China's domestic consumption, help stabilize prices, and advance expansion in the middle and western regions" of China -- a nod to Beijing's oft-repeated desire to make progress on these goals in the current Five Year plan.


"It's a warm bath of slow adjustment..."

February 16, 2012

The fashion elite are gathering to search for glamour in a series of tents. Big money investors are circling the heavily indebted Barneys New York. Ralph Lauren is printing money, almost completely unhindered by the shuttering of American Living. J.C. Penney is reinventing, again.

And the Juicy girls are back -- and still wacky.

There are some things that never seem to change. Everything else is in flux. It's not fast change like everyone says it is. It's a warm bath of slow adjustment -- at least to our stimulus-crazed brains. It's change that takes just enough time to grab hold that you can trick yourself, if you really want to, in believing that nothing's really changing at all.

Or as Kit Yarrow, consumer psychologist at Golden Gate University, says, some people are coping with the shifting landscape by zeroing in on one aspect of their business. "To avoid the anxiety of the overwhelming amount of change going on they sort of focus their efforts into one area," she said. "They say to themselves, 'We have to find a way to make our online presence more usable.' People get all excited about one area where there are millions of different ways the retail landscape is changing."

The Internet is a good example.

It arrived on the scene with lots of bluster and retailers were tripping over themselves to get online. For years they tried to figure out where e-commerce fit or how much emphasis it should get.

Then somewhere along the way the Web shifted from the new novelty and the next big thing to just another way to drive revenue. It became a half-hearted replacement for the catalogue. Now that it's taken off, retailers point to their quickly ballooning e-commerce businesses as a sign of success. For many, it's the only growth they can point to.

The industry got smoked by Amazon.com, which grew its business exponentially and with intense focus, logging $17.3 billion in U.S. electronics and general merchandise sales last year. Those sales could have gone to traditional retailers. The Web giant is now said to be looking to open its own stores, taking a page from Apple's successful retail playbook.

And all sorts of other changes are moving through.

Social media is becoming a force in commerce, not just a digital hangout. The economics of retail real estate are shifting. Credit Suisse warned in a recent analysis that the closure of anchor stores threatens weaker "C" and "D" malls with a retail version of colony collapse disorder, which decimated the honeybee population. Sears Holding Corp. is already closing up to 120 doors and others could follow suit, prompting other chains to pull out of sunset malls.

The consumer is still discombobulated by the horrible housing market, high unemployment, the presidential election, the bad headlines out of Europe. They don't know where to turn.

This has all been going on for so long now, it just seems normal. So normal, in fact, that retail stocks are hitting all-time highs, singling that investors see better times around the corner.

Even if better times are just around the corner, the retail landscape is still going to look much different. And it will continue to shift. There's just too much going on to believe in any kind of real retail solidity.

So the message is: Be sharp, the retail world will require it.
For more information, visit: http://www.wwd.com/fashion-blogs/the_more_things_stay_the_same-12-02


"Wholesalers balance inventory with sales"

February 15, 2012

Balancing inventories is key to managing profitability and to avoiding fresh production cutbacks if demand continues to remain modest this year.

Data from Sageworks, a financial information company, shows that U.S. businesses are keeping their inventories in line with demand, with wholesalers, in particular, balancing their stockpiles from manufacturers and their sales to retailers.

Sageworks recently conducted a financial statement analysis of privately held wholesale merchants and found they’ve kept their inventory days steady despite sales growth. Private wholesalers, part of a $4 trillion sector that operates between manufacturing and retailing, in 2011 saw a second year in a row of double-digit sales growth as sales increased nearly 13 percent, according to Sageworks’ data. Sales had rebounded from a roughly 3 percent decline in 2009 to a nearly 11 percent increase during 2010. Across all industries, private-company sales rose about 7 percent last year.

Wholesalers’ inventory days, meanwhile, have stayed level at around 77 in 2009, 2010 and 2011, suggesting private suppliers are doing a good job of managing their stocks. Inventory days are calculated as inventories divided by cost of goods sold (COGS), multiplied by 365.

“The steadiness of wholesalers’ inventory days suggests that private wholesalers are doing a good job of managing inventories compared to their sales—they have a good sense of the demand they face now and will face in the near future,” said Sageworks analyst Libby Bierman. “This is especially true since inventory days remained stable even after the recession hit wholesalers.”

 Financial analysis of wholesale merchants: inventory days vs sales change

Data from the federal government on Tuesday also provided evidence of balanced business inventories. The U.S. Census Bureau reported manufacturers’ and trade inventories grew at a slower rate than their sales and shipments in December. Business inventories increased a seasonally adjusted 0.4 percent in December and were up 7.7 percent from a year earlier, compared with sales increases of 0.7 percent from November to December and 8.9 percent from a year earlier.

The total inventory-to-sales ratio ended the year at 1.26 on a seasonally adjusted basis, compared with 1.28 at the end of 2010, the government said. Manufacturers ended 2011 with a 1.33 inventory-to-sales ratio, down from 1.34 in November. Retailers and merchant wholesalers’ inventory relative to sales was unchanged from November, when it was 1.32 and 1.15, respectively.

Sageworks, a financial information company, collects and analyzes data on the performance of privately held companies and provides financial forecasting software.

 

 

For more information, visit: http://www.forbes.com/sites/sageworks/2012/02/15/wholesalers-balance-inventory-with-sales/


Crocs Creating Stepping Stones For Their Comeback

February 15, 2012

Crocs Inc announced its expansion into licensing, providing opportunities for the Crocs brand to extend beyond footwear. The company has signed licensing agreements with key global and regional manufacturers for products ranging from apparel to sunglasses and other accessories.

 

“Licensing presents an opportunity to leverage one of our most valuable assets – the global power of the Crocs brand - by associating it with best-in-class products that go beyond footwear,” said Mike DeBell, Vice President of Global Sales. “More than 200 million pairs of Crocs shoes have been sold, in more than 90 countries around the world. That’s powerful testimony to the connection forged with consumers by the Crocs brand. Through strong international and regional licensing partners, we plan to extend the power of our brand and make new consumer connections.”

 

The first non-footwear Crocs-branded products included a line of adult and children’s socks from Sock and Accessories Brands, which launched in the holiday 2011 season. These are available in North America through wholesale and retail channels. Crocs-branded socks, produced by Intersocks, will also be available throughout European markets.

 

Crocs also entered an agreement with Accessory Exchange, which is producing a variety of Crocs-branded accessories for men, women and children, in several global regions. Accessory Exchange Crocs-branded products include hats, bags, backpacks, socks and gloves that are available now at Crocs retail stores and Crocs.com.

 

In April 2012, the Crocs brand will extend to children’s apparel through an agreement with the A Group. The children’s apparel will be available in 46 countries around the globe and distributed through retail and wholesale channels. Crocs-branded sunglasses and sunglass accessories also will launch in May 2012. Eye King, LLC is producing sunglasses for adults and youth for retail and wholesale distribution in the U.S. and Canada.

 

Through a partnership with ICER Brands, Crocs Professional Footwear Division will build on the loyal following of medical professionals with the introduction of Crocs-branded scrubs. This new medical gear is available now through specialty stores and online.

 

Finally, Paramount, a sports licensee, recently kicked off Collegiate and MLB licensed footwear for the brand, which is available now.

 

“As we continue to explore these and other new collaborations, I am confident our license partners will help us grow and spread our brand promise of delivering products with profound comfort, fun and innovation,” continued DeBell.

 

A world leader in innovative casual footwear for men, women and children, Crocs Inc, offers several distinct shoe collections with more than 250 styles to suit every lifestyle.

 

For more information, visit: http://www.fibre2fashion.com/news/company-news/crocs-inc/newsdetails.aspx?news_id=108076


JCPenney--predicted to be one of the most interesting retailers in 2012

February 13, 2012

J.C. Penney just blew up its brand — in a good way — thanks to a new management team with some radical new ideas. J.C. Penney is about to be the most interesting retail story of the year.

Late last year, J.C. Penney began building a dream team with Ron Johnson — the man who launched Apple‘s retail stores — as its new CEO. Johnson cut his retail teeth at Target and from there he poached Michael Francis to serve as J.C. Penney’s new president. Francis is largely responsible for Target’s branding and marketing efforts.

And this week, Johnson took a sledgehammer to the J.C. Penney way of doing business. It’s the most exciting thing I’ve seen in retail since Apple opened stores, again with Johson at the the helm.

 There’s a new logo, new spokesperson, new pricing stategy, an investment in Martha Stewart Omnimedia and another designer partnership with Nanette Lepore. All in two short months.

 

J.C. Penney — now being referred to as jcpenney — is implementing a new pricing strategy, slashing prices up to 40% with to keep them that way year round. Not EDLP, this fair pricing strategy is designed to keep prices low on the basics shoppers look for frequently and introduce new merchandise on a routine schedule.

“We want customers to shop on their terms, not ours,” said Johnson. “By setting our store monthly and maintaining our best prices for an entire month, we feel confident that customers will love shopping when it is convenient for them, rather than when it is expedient for us.”

It’s a shocking move for any retailer, let alone a department store where hi-low pricing and promotions have long been the norm.

There will also be an entirely new layout, with brands merchandised in shops within the store rather than endless racks and runs of shelves. There aren’t many new ways to display merchandise and any effort to re-invent the in-store experience will be welcome with shoppers and provide a reason to buy in stores, rather than looking for bargains online.

“The department store is the number one opportunity in retail today. We are going to rethink every aspect of our business, boldly pursue change, and create long-term shareholder value, as we become America’s favorite store,” Johnson said. “Every initiative we pursue will be guided by our core value to treat customers as we would like to be treated – fair and square.”

The new logo is meant to evoke the American Flag, a move likely to resonate with today’s shoppers and set it apart from the rest of the retail pack.

Most retailers make tentative steps toward change. They take a year to develop a new store format, reconfigure a layout or commission a logo. Then they test it, refine it and test it again. It can take years to roll out changes to a large store base and often before that happens, the plan changes again.

But Johnson is anything but typical. Changes begin on Feb. 1 and  in August jcpenney will begin updating all stores with new merchandise and presentations, adding two to three shops each month through 2015 in what management is calling a complete transformation.

It’s refreshing, daring and probably exactly what the retailer needs. It’s probably what a lot of retailers need but few have the leadership and support to do it.

 

For more information, visit: http://www.forbes.com/sites/lauraheller/2012/01/26/why-jcpenney-will-be-the-most-interesting-retailer-of-2012/


JCPenney--predicted to be one of the most interesting retailers in 2012

February 13, 2012

J.C. Penney just blew up its brand — in a good way — thanks to a new management team with some radical new ideas. J.C. Penney is about to be the most interesting retail story of the year.

 

Late last year, J.C. Penney began building a dream team with Ron Johnson — the man who launched Apple‘s retail stores — as its new CEO. Johnson cut his retail teeth at Target and from there he poached Michael Francis to serve as J.C. Penney’s new president. Francis is largely responsible for Target’s branding and marketing efforts.

 

And this week, Johnson took a sledgehammer to the J.C. Penney way of doing business. It’s the most exciting thing I’ve seen in retail since Apple opened stores, again with Johson at the the helm.

 

There’s a new logo, new spokesperson, new pricing stategy, an investment in Martha Stewart Omnimedia and another designer partnership with Nanette Lepore. All in two short months.

 

 

J.C. Penney — now being referred to as jcpenney — is implementing a new pricing strategy, slashing prices up to 40% with to keep them that way year round. Not EDLP, this fair pricing strategy is designed to keep prices low on the basics shoppers look for frequently and introduce new merchandise on a routine schedule.

 

“We want customers to shop on their terms, not ours,” said Johnson. “By setting our store monthly and maintaining our best prices for an entire month, we feel confident that customers will love shopping when it is convenient for them, rather than when it is expedient for us.”

 

It’s a shocking move for any retailer, let alone a department store where hi-low pricing and promotions have long been the norm.

 

There will also be an entirely new layout, with brands merchandised in shops within the store rather than endless racks and runs of shelves. There aren’t many new ways to display merchandise and any effort to re-invent the in-store experience will be welcome with shoppers and provide a reason to buy in stores, rather than looking for bargains online.

 

“The department store is the number one opportunity in retail today. We are going to rethink every aspect of our business, boldly pursue change, and create long-term shareholder value, as we become America’s favorite store,” Johnson said. “Every initiative we pursue will be guided by our core value to treat customers as we would like to be treated – fair and square.”

 

The new logo is meant to evoke the American Flag, a move likely to resonate with today’s shoppers and set it apart from the rest of the retail pack.

 

Most retailers make tentative steps toward change. They take a year to develop a new store format, reconfigure a layout or commission a logo. Then they test it, refine it and test it again. It can take years to roll out changes to a large store base and often before that happens, the plan changes again.

But Johnson is anything but typical. Changes begin on Feb. 1 and  in August jcpenney will begin updating all stores with new merchandise and presentations, adding two to three shops each month through 2015 in what management is calling a complete transformation.

 

It’s refreshing, daring and probably exactly what the retailer needs. It’s probably what a lot of retailers need but few have the leadership and support to do it.

 

For more information, visit: http://www.forbes.com/sites/lauraheller/2012/01/26/why-jcpenney-will-be-the-most-interesting-retailer-of-2012/

 


Will you be able to get a piece of Facebook?

February 13, 2012

Front-and-center on Facebook's IPO prospectus is its mission "to make the world more open and connected." Yet the IPO process itself is notoriously closed and opaque, with financial institutions parsing out shares at the offering price to their best clients to give them the benefit of the initial run-up in value.


Since Facebook derives 100% of its value from the willingness of its 845 million users to share their activities, will Facebook share the bounty with its users? And if so, how?


It so happens that Chris Kelly, Facebook's former chief privacy officer (and onetime candidate for California attorney general), is a director and biggest outside shareholder in Loyal3, a startup that could help Facebook do that.


Loyal3 has developed a platform that would allow a stock issuer, such as Facebook, to offer shares to millions of people at the same price as the huge financial institutions underwriting the deal.


Here's how it works: Buyers set up an account and then commit to a maximum bid of $200, $300 or $400, increments geared for small, individual investors. The bidder is awarded a number of shares depending on the offering price. And that transaction is shared on Facebook.


"Facebook has taken a central role in the online identity broker in everyday life. Why shouldn't it extend to financial services as well?" Mr. Kelly said. "This is the next evolution of the 'like' button in a lot of ways."


Loyal3 CEO Barry Scheider said his company will power an IPO in the coming months. One question: Will it be Facebook's IPO?


Messrs. Kelly and CEO Barry Schneider won't say, but they also won't rule it out.


"Imagine a day when 500,000 or 10 million people get access to an IPO at the same price as institutions," Mr. Schneider said. "We are ready to do a 'social IPO' and we're going to do just that."


There's some precedent here. In an attempt to live up to its "Don't Be Evil" mantra, Google used a "Dutch Auction" to let individuals buy shares at the IPO price in 2004. You'd think Facebook would want to take the concept further.


But Facebook has another good reason to let its uses in on the action. As anyone with a dim memory of Friendster or MySpace can attest, the network effects that create social phenoms can also accelerate their downfall. But if Facebook offered shares to its users, they'd have an incentive to keep sharing their lives on Facebook, and thus helping create value for a company they own.


That's also the bigger idea behind Loyal3: create a class of fans-owners by allowing brands to cost-effectively sell small amounts of shares to consumers -- in as little as $10 increments -- via Facebook. (See separate Ad Age story.) The mechanism is a direct stock-purchase plan that has been around since the 1970s but not widely used because of the expense of servicing many small shareholders.


Loyal 3 built a digital platform to take the costs out and make it as easy to buy a company share as a book on Amazon. Brands could do more than sell stock directly; they could give it away in lieu of miles, points or other incentives to their best customers. "The truth is people care way more about things that they own than things that they don't," Mr. Schneider said.

 

For more information: http://adage.com/article/digital/facebook-users-buy-ipo-shares/232689/


How Are You Retaining Customers?

February 13, 2012

Love just isn't enough anymore. In brand relationships, good customer service, high customer satisfaction and even professed brand loyalty won't keep consumers from ditching a product for the competition. In fact, more than half of U.S. consumers did so last year.

A global study by Accenture found that even though consumers are more satisfied with customer service than ever before, they are switching brands at a high rate.

The survey, conducted over the web in September and October 2011, queried more than 10,000 consumers to measure customer satisfaction across key attributes in 10 different industries. It found that while satisfaction increased for all those service attributes, an astounding two-thirds of respondents -- 66% -- reported they switched brands in the past year because of a bad customer experience. While the U.S.-only percentage of switchers was lower in 2011, at 51%, it is still significant and an increase over the previous year.

"Switching is something that's here to stay, said Robert Wollan, global managing director, Accenture customer relationship management. "Consumers have become accustomed to switching when the service or product isn't meeting their needs."

What is new is the big uptick in satisfaction, with increases ranging from 5% to 7% in one year, depending on the category. Consumers are happier, for instance, with shorter wait times (33% are satisfied compared to 27% last year); the ability to solve issues without having to speak to someone (38% satisfied, up from 33%); and the ability to resolve an issue by speaking to just one person (39% compared to 32%).

So what's going on -- shouldn't happier customers mean more loyal customers? Not necessarily. About one-fourth (24%) of consumers characterize themselves as brand loyal, while an almost equal number (23%) describe themselves as having no loyalty at all. As Mr. Wollan pointed out, not only are consumers now used to switching brands, there is a third factor on the increase that may also help explain the trend: the rise in customer expectation.

About 44% said they expect more, or much more, than they did last year from the brands with which they do business. In 2008, 31% said they expected more than the year before.

"We think the attributes we ask about -- wait times and talking to just one person to resolve issues -- have become table stakes," Mr. Wollan said.

Today's savvy digital customers expect polite and knowledgeable employees or convenient customer-service hours. And while they appreciate and are satisfied with those things, it's not going to stop them from taking their business elsewhere.

Also on the rise is partial switching, defined as when a consumer keeps a brand, but also adds another in the same category, such as buying a second mobile phone from a different provider. Partial switching in 2011 increased in all 10 industries Accenture tracks, from retail and consumer electronics to travel and tourism and banking. That's not only lost business, but more importantly, a loyalty lapse that opens a door to a new brand.

 

For more information, visit: http://adage.com/article/news/brand-love-satisfaction-shoppers-faithful/232680/


How Are You Retaining Customers?

February 13, 2012

Love just isn't enough anymore. In brand relationships, good customer service, high customer satisfaction and even professed brand loyalty won't keep consumers from ditching a product for the competition. In fact, more than half of U.S. consumers did so last year.

 

A global study by Accenture found that even though consumers are more satisfied with customer service than ever before, they are switching brands at a high rate.

 

The survey, conducted over the web in September and October 2011, queried more than 10,000 consumers to measure customer satisfaction across key attributes in 10 different industries. It found that while satisfaction increased for all those service attributes, an astounding two-thirds of respondents -- 66% -- reported they switched brands in the past year because of a bad customer experience. While the U.S.-only percentage of switchers was lower in 2011, at 51%, it is still significant and an increase over the previous year.

 

"Switching is something that's here to stay, said Robert Wollan, global managing director, Accenture customer relationship management. "Consumers have become accustomed to switching when the service or product isn't meeting their needs."

 

What is new is the big uptick in satisfaction, with increases ranging from 5% to 7% in one year, depending on the category. Consumers are happier, for instance, with shorter wait times (33% are satisfied compared to 27% last year); the ability to solve issues without having to speak to someone (38% satisfied, up from 33%); and the ability to resolve an issue by speaking to just one person (39% compared to 32%).

 

So what's going on -- shouldn't happier customers mean more loyal customers? Not necessarily. About one-fourth (24%) of consumers characterize themselves as brand loyal, while an almost equal number (23%) describe themselves as having no loyalty at all. As Mr. Wollan pointed out, not only are consumers now used to switching brands, there is a third factor on the increase that may also help explain the trend: the rise in customer expectation.

 

About 44% said they expect more, or much more, than they did last year from the brands with which they do business. In 2008, 31% said they expected more than the year before.

 

"We think the attributes we ask about -- wait times and talking to just one person to resolve issues -- have become table stakes," Mr. Wollan said.

 

Today's savvy digital customers expect polite and knowledgeable employees or convenient customer-service hours. And while they appreciate and are satisfied with those things, it's not going to stop them from taking their business elsewhere.

 

Also on the rise is partial switching, defined as when a consumer keeps a brand, but also adds another in the same category, such as buying a second mobile phone from a different provider. Partial switching in 2011 increased in all 10 industries Accenture tracks, from retail and consumer electronics to travel and tourism and banking. That's not only lost business, but more importantly, a loyalty lapse that opens a door to a new brand.

 

For more information, visit: http://adage.com/article/news/brand-love-satisfaction-shoppers-faithful/232680/