Actionable Insights From APT's Retail Practice

More Banks Hopping on the Cost Cutting Bandwagon

July 25th, 2011 | Posted by Will Weidman in Financial Services | Uncategorized - (Comments Off on More Banks Hopping on the Cost Cutting Bandwagon)

The Wall Street Journal recently reported an increasing effort across banks to cut costs amidst declining loan volumes and the effect of Durbin and other regulations.  This is of course a reasonable and necessary response to the challenging external environment.  The challenge lies in understanding how deep to cut before the cost cutting does more long term harm than it’s worth. 

It can only take one interaction with an overwhelmed teller or one call with a 15 minute hold to lose a customer’s support.  Banks have the data and should be able to know in advance what will happen if they cut various customer facing functions, or even entire branches.  If they look, what they should see is that the customer sensitivity to these pull backs vary greatly by channel, by customer type, and by geography, but these variations are also predictable.   Bank should know where the low hanging fruit is and be to know in advance where and how deep they can cut with minimal negative customer response.

Increasing Innovation at Banks

July 14th, 2011 | Posted by Will Weidman in Financial Services | Uncategorized - (Comments Off on Increasing Innovation at Banks)

Banking Strategies recently published an article titled “Why Banks Struggle with Innovation.”  The article contends that banking is one of the least innovative industries today.  From our experience, we agree that many banks struggle to truly innovate and are behind the curve relative to other industries such as retail.

This article contends that there are two problems – “The first is: how to measure the business value of innovation. And the second is: we want to innovate, but have to choose something easy.” (more…)

Energy Management Systems: How to Maximize ROI

July 10th, 2011 | Posted by Marek Polonski in Retail - (Comments Off on Energy Management Systems: How to Maximize ROI)

Washington D.C. – Energy Management Systems (EMS) are becoming more and more commonplace in both convenience and grocery stores. The promise of reduced energy consumption and costs coupled with a desire to go green is driving leading retailers to try out new EMS offerings across their networks. Kwik TripStripes and Green Valley are among the early adopters benefiting from new EMS technologies targeted at c-stores. Supermarket News reports of similar enthusiasm among forward-thinking grocers. (more…)

Kroger Tests New Fuel Discounts, Crushes Quarterly Estimates

July 8th, 2011 | Posted by Dan Schreff in Retail - (Comments Off on Kroger Tests New Fuel Discounts, Crushes Quarterly Estimates)

UPDATE: CVS & Walmart are testing new fuel discounts tied to minimum spend levels in their retail stores

Shoppers in many markets around the U.S. take advantage of them, but are discounts on gasoline an effective way to build supermarket shopper loyalty and drive traffic into stores? (more…)

Stuffed Shelves are Popular Again

July 8th, 2011 | Posted by Marek Polonski in Retail | Uncategorized - (Comments Off on Stuffed Shelves are Popular Again)

Washington D.C. – The New York Times is reporting that many retailers are going back to the true and tried strategy of stocking their shelves, aisles and backrooms with more inventory. As we discussed before, the notion of shoppers preferring to have less choice is a myth. Many retailers learned this the hard way in the last 3-5 years: SKU rationalization efforts have not worked as well as merchants at the leading retailers have hoped. (more…)

A Salty Debate on Sodium Reduction

July 6th, 2011 | Posted by retailblogadmin in Restaurants - (Comments Off on A Salty Debate on Sodium Reduction)

UPDATE: Campbell Soup’s new CEO plans to increase the salt content in its core soup products.

Researchers at the University of Exeter released findings this week questioning claims that lower sodium diets can reduce the risk of death from heart disease.

While still early, these findings challenge the opinions of public health advocates who have lobbied municipalities, most notably New York, to reduce salt content across a range of food products, citing that eighty percent of salt in American’s diets comes from packaged or restaurant consumables.

While industry reaction to sodium reduction proposals have been mixed at best, companies ranging from Pepsi to Taco Bell announced initiatives to identify new seasonings to reduce salt content in their products.


When Pundits Get It Right

July 6th, 2011 | Posted by JMarek in Uncategorized - (Comments Off on When Pundits Get It Right)

Amidst all the industry forecasts that change like weather forecasts, sometimes the restaurant industry talking heads really get it right.  They certainly did on Soul Daddy, the reality-TV launched concept that recently closed 2 of its 3 launch locations.  The knock pre-launch was that new restaurant operations are hard, and so launching 3 restaurants in 3 separate cities was a pathway to disaster.  Two months later, the New York and Los Angeles locations are gone. 

“Retail is detail”, as they say.  This shows the value of first tinkering and truly testing to get all the details of operations right pre-expansion and to keep them working on an ongoing basis as restaurants scale.

Will You Benefit from Increased Transparency Around Fees?

July 5th, 2011 | Posted by Will Weidman in Financial Services | Uncategorized - (Comments Off on Will You Benefit from Increased Transparency Around Fees?)

The majority of financial institutions are increasing fees to make up for lost revenue due to increased regulation.  Unsurprisingly, this has taken a toll on customer satisfaction. 

An American Banker article detailed a survey of brokerage customers by J.D. Power that showed “a significant decline – down to 703 points from 733 points in 2010 – in overall satisfaction.” However, the lower customer satisfaction was not uniform, and some institutions did perform very well. (more…)

The Value of Being Channel "Agnostic"

July 1st, 2011 | Posted by Will Weidman in Uncategorized - (Comments Off on The Value of Being Channel "Agnostic")

The Economist recently published an article on retail banking called the Road to Agnosticism about the growth of internet and mobile banking and the evolving nature of the branch.  The article discussed the divergent strategy banks are taking regarding their branch channel as it co-exists with the more emergent channels. 

We think branch agnosticism is a great term and should be the goal for every bank.  Banks should be focused solely on maximizing profits and customer satisfaction with an agnostic perspective on the channel mix that accomplishes this.  (more…)