ETD: 990 Retailing in Israel; Market Research; Luxury Travel
Market Booms
E-Tailer's Digest
etd_post at gapent.com
Tue Jul 11 10:45:01 GMT 2006
E-Tailer's Digest --- Everything for the Retailer
Issue #0990 July 11, 2006
George Matyjewicz, Moderator mailto:georgem at gapent.com
Published by: GAP Enterprises, Ltd. http://www.etailersdigest.com
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CONTENTS
[1] Greetings
[2] Retailing in Israel
[3] Market Research
[4] Luxury Travel Market Booms
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[1] Greetings.
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Hi All:
We're back fro our trip. We did a business/pleasure trip to Israel,
which was very interesting. Retailing there is quite an
experience. They must be doing something right - Warren Buffet just
spend $4 billion buying a company there.
List member and market research guru, Phil Glowatz has a follow up on
our post on market research. Great stuff. Phil is a partner with
that other guru Jacques Chevron, together who do some great marketing stuff.
Pam Danziger has a new report on luxury travel. This trip, for the
first time, we flew business class, so I can attest to her
findings. We figured an 11 hour trip was worth business class (and
we were right). Besides the price was right. What do you think? Do
you take advantage of luxury travel?
Now, let's get to everything for the retailer.
Sincerely
George Matyjewicz, PhD
Chief Global Strategist, GAP Enterprises, LLC
mailto:georgem at gapent.com
http://www.etailersdigest.com
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[2] Retailing in Israel
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Retailing in Israel is quite interesting. For the most part, the
retailers are small shops with speciality goods. However, Jerusalem
does have at least eight malls and the number is growing. In fact,
Israel is now third in the world in the ratio between population and
mall space, right behind the United States and Sweden.
We visited the largest mall in the Mideast - the Malcha Mall which is
not much different from malls here in the U.S. There are a couple of
unique features. Where, but in Israel, will you find a mall that has
a synagogue on the ground floor, if you feel the urge to pray as you
fill your shopping bags? In the afternoons, especially in the summer
and around holiday times, there are free shows, arts & crafts and
other activities for kids. On the ground floor, outside a pet shop,
is a glass cage with an assortment of birds and small animals. And
since this is Israel, the security at all entrances is worthy of
note. You will be asked to open your bags and walk through a metal detector.
Of course, since it is Israel, all the food places are kosher. It's
interesting to see a kosher MacDonald's.
In the Old City of Jerusalem there are the four quarters for shopping
- Jewish, Arab, Armenia and Christian. And you must be able to
haggle, otherwise don't go shopping. We met a friend there who
haggled for us, and I couldn't believe how low they would go. One
item started at $75 USD and we got it for $15. In some of the fine
jewelry shops you couldn't haggle as much, and were lucky to get
25-25% off. We got some nice jewelry and art works, as well as clothing.
Traveling north, to Golan Heights we found mainly small shops, all
with unique goods. Going south to Massada, we found fewer shops.
We were also looking to source products from Israel, and were
intrigued by a recent purchase. Warren Buffett just made an
acquisition in Israel, purchasing ISCAR Metalworking and Agro-Logic,
a small agricultural manufacturing company. He invested $4 billion to
buy ISCAR, which is the largest purchase he has ever made outside of
the United States
Their high-tech industry (including aviation, communications,
computer-aided design and manufactures, medical electronics, fiber
optics) is one of the biggest industries, and produces a large
discrepancy between the "haves' and the "have nots." This in
high-tech earn a substantial living, while the rest of the country
lives more modestly. I understand that 85% of the population earns
less than $38,000 per year.
Yes, is was scary at times traveling about, but it is a beautiful
country, with lot's of history.
George
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[3] Market Research
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I agree that many companies simply ignore consumers and go with what
they "know" will work, which is wrong probably more often than it is
right. Others conduct market research at the wrong stage of
product/service development. They spend lots of time and effort in
product development (up to a certain point), and THEN they do
research. If, at that juncture, consumers say they don't want it --
or if they want features that hadn't been considered -- the money
spent on development has been mostly or all wasted.
I think a big part of the problem is that many marketers simply don't
understand marketing research, and way too many view it as an expense
rather than an investment. Yet smart research frequently yields a
tremendous ROI: E.g., If you conduct $25,000 worth of research, and
the findings direct you to NOT launch a product that would have cost
$250,000, your ROI is 10x. Conversely, doing research so you can
imbue a product with the features people tell you they want, rather
than what you THINK they want, can mean the difference between
success and failure and, also, a ton of money.
Indeed, in many cases, market research isn't even on the radar. For
instance, of your readers who have retail web sites, what percentage
of these have been researched with customers and potential
customers? I'll bet the percentage is really low. Is the site
organized in an intuitive way? Can customers easily find what they
want? Is the home page inviting? Is the information on individual
products presented in the correct way, with the specs people want to
see? Do the pictures show the views of the product that the customer
wants to see? I'd wager that the vast majority of your readers with
retail web sites can't answer those questions with any certainty, yet
they pin their livelihoods on those web sites.
Market research is the essential information tool of marketing, but
too few marketers use it.
Phil Glowatz
Partner, JP Group
http://JPGroupUSA.com
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[4] Luxury Travel Market Booms
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In 2005 the typical luxury consumer spent $25,972 on luxury
travel. That is up a stunning 41 percent over the average amount
spent in 2004 of $18,474. Based upon new research from Unity
Marketing, luxury consumers' spending on luxury travel in 2006 is
predicted to exceed $28,000 on average, an 8 percent increase over
previous year. In the latest survey of luxury consumers, some 40
percent say they will spend more on luxury travel this year than
last, while a near equal percentage (43 percent) expect to spend
about the same.
What is behind luxury consumers' wanderlust that causes them to spend
so much money on travel? The answer lies in return on
investment. Luxury consumers spend their money where they get the
most luxury satisfaction. For today's luxury consumer that comes
from luxury experiences, like travel, not from buying more material
goods. In other words, travel and other experiences give them the
most bang for their buck.
In Unity Marketing's most recent Luxury Tracking study, a quarterly
survey of 1,200 affluent consumers about their luxury purchases,
spending and brand preferences (average income $145.7k and age 42.7
years), key findings about luxury travel include:
o Nearly four luxury trips are planned for the rest of the
year: Luxury consumers have plans to take 3.6 personal trips or
vacations from April to December 2006. Fewer than 10 percent of
luxury consumers have no trips planned for the remainder of 2006.
o Luxury resorts and foreign travel are a part of more luxury
travelers plans: One-third of luxury consumers plan to stay at a
luxury resort this year, while one-fourth have plans for foreign
travel. Luxury cruises are on the agenda for 15 percent of luxury
consumers and private air travel for 14 percent.
o Luxury consumers travel mainly for relaxation and stress
relief: Taking a break from their high pressure lives is the main
reason why luxury travelers venture forth. Nearly half of luxury
consumers (47 percent) say that "relaxation and stress relief" are
very important when they travel.
o Making memories is the ultimate travel reward: When it comes to
the experiences they want to obtain from their travels, the majority
of luxury consumers (56 percent) say that "having special experiences
that make memories" is very important. This is followed closely by a
desire to "visit new places, have new experiences," rated very
important by 48 percent of luxury travelers.
Unity Marketing publishes its Luxury Tracking Study quarterly with
the next due in July/August 2006. For more information visit
(http://www.unitymarketingonline.com/reports2/luxury/luxury3.html)
Pam Danziger,
President
Unity Marketing
717-336-1600.
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