'The Hub': Just-in-Time Television

Wal-Mart may own the fifth-largest television network in America, but it is a mistake to assume that Wal-Mart TV is a medium like ABC, NBC, CBS or FOX. While it is true that Wal-Mart's television network reaches something like 130 million viewers each week, its viewers are very different from those watching the other four networks for one simple reason: They are shopping. They are not relaxing at home, engrossed in their favorite programs and hopefully enjoying the commercials as well. In many cases, they are "on a mission," rushing through the grocery store or focused on the purchase of the latest consumer electronics gadget. Sometimes the last thing they want is anything that will interrupt their mission which, at least in the case of supermarkets, drug and mass merchandise stores can be to get in and out as quickly as possible. That means that consumers must view any medium in a store as help and not a hindrance. Retail Television, or what is now more commonly called Digital Media Networks (DMN), must maximize relevance and add value for the shopper as much as it builds sales and profits for the retailer. Exactly how that mandate translates into a marketing strategy remains one of the greatest questions facing business today. To its credit, Wal-Mart has been the leader in finding an answer to that question and is paving the way to the future of this medium. However, it's important to remember that, because of its scale, the Wal-Mart model is not easily replicated by others. It is also important to remember that Wal-Mart itself remains on the learning curve with this new medium. As Wal-Mart CMO John Fleming [told] HUB, some "fine-tuning" in terms of "placement and programming" is in order. He seems to be referring to the reality that at retail, unlike at home, simply serving brand awareness is not enough; the imperative is to take full advantage of the dynamics of "right time, right place" and that the audience is actively shopping -- not passively watching. The opportunity, among others, is to drive both awareness and traffic to certain categories like apparel and consumer electronics, for example -- where Mr. Fleming says Wal-Mart sees its greatest growth potential. Indeed, to that end, Wal-Mart recently established a total of six different channels within its stores -- in the electronics, videogame and music departments, as well as in grocery, pharmacy and at the checkout lanes.Little question but that Wal-Mart's foray into television has been a huge success on many levels and will continue to be so. The question is whether it has been a success where many, in this era of ROMI (return on marketing investment), would argue it counts most: Increased sales at retail. As retail consultant Phil Lempert told The New York Times: "You might be able to say Wal-Mart is the fifth-largest network based on the number of people who walk by it, but it doesn't mean they are paying attention to it and that it's empowering them to buy those products." This is not to disparage Wal-Mart TV but rather to suggest that the potential of television as a medium at retail is still in its infancy -- meaning that its potential is tremendous. However, its potential will be realized only when marketers fully understand that the future of marketing at retail looks more like the promotion business than it does the advertising business. Again, the key is to maximize the relevance of television at retail, which means using the medium to help shoppers make the most of their shopping excursions, in real-time. One way of thinking about the power of this medium is "Justin-Time Television" -- or JIT-TV -- which puts the focus on the importance of delivering relevant time-and-place messaging. It's not that retailers or their supplier brands do not understand JIT-TV, but rather that few of them have managed to accomplish it yet. No question that they will, and sooner than most people realize. As Nikki Baird of Forrester Research notes: "Stores can show different content in the deli department versus the beverage aisle. Programmi ng can also vary by day part or geography, allowing advertisers to target the high-traffic times and store locations that match their demographic. Amazingly, in-store TV has better targeting than traditional cable and broadcast TV, which have been slow to adopt new targeting technologies." Those technologies are here and are less complex and costly than one might think. For example, Digital View has developed a content management and distribution technology that can be used to design and schedule advertising or promotional campaigns through a standard browser on a normal, internet-connected PC. Called RemoteTransfer, the application is web-based and highly secure. It enables users to deliver and update messaging to almost any out-of-home location on a highly targeted basis. This type of system enables the media and messaging to be changed throughout the day, and by location, to single or groups of displays, keeping branding fresh and relevant. With few exceptions, such capabilities have yet to be applied on any largescale basis, but given the imperative to maximize brand relevance at retail, look for that type of technology to manifest itself very soon indeed. In the meantime, it is worth watching Target Stores, which has rolled out a multi-channel, in-store television network to 1,400 locations nationwide. Target has been tightlipped about the initiative, called Channel Red. However, according to a report by the In-Store Marketing Institute, Target has acknowledged that its new network represents an upgrade to digital from analog, which opens up a world of possibilities for JIT-TV for the retailer. The Institute also reports that Best Buy "recently completed a strategic consolidation of all in-store electronic media" from some 17 different systems to just two. "In 2006, Best Buy plans to fine-tune both digital-media offerings to better complement its customer-centric store strategy, as well as to explore more digital interactivity and customer retention strategies." Best Buy may, in fact, turn out to be the early leader in JIT-TV, given its strong emphasis on customer service. Best Buy's edge in this regard is reinforced not by its fresh commitment to digital media but its heavy emphasis on its back-end operations. An excellent article by Ken Cotrill in Supply Chain Strategy magazine details how Best Buy has re-vamped its supply chain to ensure that, among other things, each store's merchandise mix is matched to its shoppers' interests. We want to act as the consumer's ambassador, the equivalent of the modern-day butler, says Best Buy CIO Bob Willett. A similar sensibility almost certainly will inform Best Buy's in-store media strategy, as well. If the goal is to make sure that the products are available when and where the shopper wants them (i.e., just-intime delivery), it would be a missed opportunity of major proportions if the merchandising message were not aligned accordingly (i.e., just-in-time media). Television at retail certainly has come a long way since Wal-Mart launched its first network nearly 10 years ago. Just as certainly it has a long way to go. Although Wal-Mart has been the leader, by no means has it been alone. Indeed, the list of retailers forming television networks gets longer every day. The development of digital media networks at retail clearly is well under way, even if marketing's grasp on its potential has yet to reach its ultimate potential. Given that the technology is here, the main hurdle is largely a creative one. Creating the kind of content that will generate sales is not a simple matter of paring down 30-second TV commercials to 10 seconds for retail, as many advertisers have done. Nor is it a matter of using this new medium to pelt shoppers with offers as they walk down the aisle, as some in the promotions business have suggested. Required is an approach that matches the message to the shopper's "need state," which is not an interruption of the shopping experience but an enhancement of it. Exactly how that plays out varies not only by product category, but also the time of day or week -- as well as both the brand 's and the retailer's objectives, of course. This may not be easy to do, but it can be done. The opportunity is to connect the dots between a brand's marketing and its sales at the final moment of truth -- to maximize the return on marketing investment in the store, where the cash register rings. About the Author: Stuart Armstrong is chief operating officer of Digital View, specialists in complete digital media networks and services for the retail and out-of home market as well as advanced connectivity solutions for LCD and plasma flat panel displays.

'The Hub': Just-in-Time Television

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