Category : analysis

History, we know, is apt to repeat itself

Why does history continue to repeat itself? And, more importantly, why don’t we learn from the past to solve our current and future problems? It’s a question I ask myself regularly but find impossible to answer.

I wrote about putting the fun back into shopping and the end of the nightclub. In both cases history could solve a problem because it already happened in the past. Nonetheless, most people (in these cases retailers and nightclub owners) fail to learn from the past. They don’t see the solution, lack courage for big changes or hope their businesses won’t be affect by, let’s say, the rise of the Internet and/or economic crisis.

Even though I know (or believe) history repeats itself, I find it surprising to read articles which date back many years, but could be written today. Here’s an example. A couple of days ago I studied the phenomenon Niketown. At a certain moment, I came across an article describing the courage Nike had to open stores during a crisis. But the author wasn’t describing today’s economic crisis. He wrote the article twenty years ago. Nonetheless, the article remains so true, even today.

Because of the many similarities between their (Niketown) situation and the situation many retailers find themselves currently in, I want to share this 1992 article from CNN Money. It’s an interesting read. And pay attention to the last paragraph. Recently, a Dutch newspaper wrote about smaller Dutch cities having trouble attracting (a large number of) shoppers. Nike shows it’s possible to attract large numbers of shoppers despite being located in a ‘remote’ or ‘less-important’ city, in their case Portland.

Nike, it seems, is on to something. ”Today’s shoppers want to be entertained,” reports Madison Riley, a retail specialist for Atlanta-based management consultants Kurt Salmon Associates. ”Niketown is theater,” says Riley, ”and for retailers, that’s a key to the future.” Niketown is putting the fun back into shopping, and that, along with a commitment to first-rate service, is why it is our [CNN Money] Store of the Year.

Nike is bold in its timing and almost unique in its positioning: it has launched the store while the retail industry is faltering — U.S. retail sales have fallen from $186 a square foot in 1980 to $161 today — and showing no signs of rebounding. Most other retailers are offering consumers no-frills, find-it- yourself outlets or lookalike, cavernous concrete warehouse clubs. As with most fancy packages, though, this one carries a pretty price.

While athletic shoes and gear are widely discounted elsewhere, Niketown customers always pay full retail price. Nothing goes on sale — ever. Niketown is designed to dazzle you into paying $100 or so for athletic shoes, $120 for a nylon running jacket and $500 or more for a total ensemble that puts you in matching socks, pants, top and sweatband. ”Niketown combines the fun of Disneyland, the museum quality of the Smithsonian and the merchandising of Ralph Lauren,” announces Gordon Thompson, the store’s 31-year-old designer, who also worked on set ideas for the 1989 movie Back to the Future II.

There are signs that other retailers are following Nike’s lead. For example, outside Minneapolis, real estate developer Melvin Simon is building what will be the biggest shopping mall in the world — a combination entertainment and shopping center dubbed the Mall of America. Simon is betting that millions of shoppers every year will be pulled in by the pizazz.

Niketown’s popularity has been overwhelming, especially considering its location. ”Portland is not exactly the crossroads of the retail world,” quips Nike chairman and founder Philip Knight, 53. In the year since the store opened, an estimated 1 million people have shopped there.

You can read the entire article here.

mms-world-new-york

Put the fun back into shopping

“Today’s shoppers want to be entertained. Niketown is theater. And for retailers, that’s the key to the future”. You might think I pulled this quote out of a recent newspaper discussing the success of Niketown versus the trouble many retailers find themselves currently in.

Wrong.

It’s 20 years old. Back in 1992, it appeared in CNN Money. The article also mentioned: “Niketown is putting the fun back into shopping.” Nike is not the only company who realized the potential of a ‘store which entertains its shoppers’. Five years after the first Niketown, candy company M&M opened M&M’s World in Las Vegas. Currently, about 8 million people visit this Las Vegas store every year.

Several years later (2001), Apple opened their first Apple Store. In Apple’s own words: “The stores are designed to simplify and enhance the presentation and marketing of personal computing products.” Just as Niketown and M&M’s World, the Apple Store is a theater. A theater for shoppers.

The other day, I read an article about Dutch retailers struggling “because of the economic crisis”. People buy less. And when they do buy stuff, people tend to visit large well-known chain stores. Or shop online. Most retailers find it hard to compete with these large chain stores and the Internet. It’s hardly impossible to compete on price (they win). In order to survive, retailers need to find other ways of attracting customers.

Retailers should start (and win) the entertainment battle. Put the fun back into shopping. Turn stores into theaters, so to speak. Just like Nike, M&M and Apple did. These companies had tremendous success with it. So why don’t you?

Dutch mountain: Joke or triumph?

The Netherlands, a country known for its windmills, cheese, wooden shoes, Delftware, dikes, tulips, bicycles and its giant two kilometer high mountain.

Huh? A mountain? I thought the Netherlands is the flattest country on earth.

Nope. Not any more. At least, not if a Dutch organization gets what it wants. This organization (Die berg Komt Er) proposes a two kilometer high mountain which will be erected somewhere in the Netherlands. Newspapers report ‘there’s probably enough space for such a mountain’. Also ‘there probably won’t be any negative side effects for the environment’. Yeah, right. Costs are expected to be around 70 billion euros (that’s over 90 billion Dollars). What the mountain will be used for? Agriculture, housing and skiing to name a few. Also the giant Dutch mountain will be used as a power plant. It should generate enough energy to power the entire city of Amsterdam with 100% renewable energy.

I thought the era of mega projects in the Western world was over. So kudos to the design team who had the guts of coming up with such a bold plan. Or is it just a publicity stunt? Are the architects of this Dutch mountain out of touch with the rest of the country? To be fair, the Dutch created 20% of their country themselves, by creating land from water. So there’s no doubt we’re technically capable (or find a way) of creating a two kilometer high mountain. But… let’s be honest, we (the Netherlands) don’t need such a mountain. Why not spend 60 billion euros to make the Netherlands the first carbon-neutral country on earth? Or why not build the Roadmap 2050 design of a carbon-neutral Europe, designed by Dutch architect Rem Koolhaas? There’s a saying, God created the world, but the Dutch created the Netherlands. It’s ever more true when the Dutch create their own two kilometer high mountain… which I hope will never be the case.


Map of Eneropa, Rem Koolhaas’ renewable world: how a new power network could solve Europe’s carbon crisis. (image courtesy: OMA)

An offer you can’t refuse


Here’s the deal. You pay me 150 million euros and you receive 300 million euros back. And it’s no scam. For many all people, this would be ‘the perfect deal’. What would your answer be?

Surprisingly, many people (or companies for that matter) answer ‘no’ to this question. BMW, the German automobile company, did not. They decided to go for it!

Back in 2000, they were in need of a new corporate headquarters. After consulting several architecture companies, they picked Wolf Prix’s Coop Himmelb(l)au as architect of their choice. In 2007 their new headquarters, BMW Welt, opened for business. The building had a staggering price tag of over 150 million euros.

When I worked for Coop Himmelb(l)au, I spoke with someone who had been involved in this project. This architect told me there was quite some debate within Coop Himmelb(l)au and BMW. Is it worth erecting a building worth over 150 million euros? Can we build it for half the money? Does BMW Welt have to be this spectacular? Ultimately Wolf Prix convinced BMW to spend the money and build this ‘temple for BWM’ as he called it. The result: In the following years, BMW received free exposure and media coverage worth hundreds of millions of euros because of their new headquarters.

I’m not suggesting bigger is always better. However, sometimes, it can be worth spending a bit more money to reach your goal. Ultimately vision and courage of the client are factors that matter most. Which is even more true during times of economic hardship.

It’s not the smoke you make, it’s the smoke people see…

It’s not the smoke you make, it’s the smoke people see… Huh? What smoke?

One of my favorite sayings is: It’s not what you say, it’s what people hear. This saying simply means we have to consider our message from the listener’s perspective and not our own. It’s not enough to be correct, reasonable or even brilliant. Nope. It’s about what they, the people hear.

Has nothing to do with smoke? Well, it does. Just read on.

Last week I, as director, spoke with a lighting technician. We were discussing the design and layout of the stage at VBG Bethel for Christmas. The stage has to look a bit mysterious. Also this lighting technician wanted to use awesome light beams. Since a beam of light is only visible if part of the light is scattered by tiny particles, like smoke, he needs a smoke machine. Such machine essentially turns water in smoke. So far so good. But this guy told me the moment he starts to use a smoke machine, some people in the audience start to cough.

If ‘it’s not what you say, it’s what people hear’ is true, you could also say ‘it’s not what you do, it’s what people see’. Which is essentially the case with the smoke machine.

People generally associate (any) smoke with irritation of the lungs. Even though the smoke is water based (thus being harmless to your lungs), people have to cough. They see smoke so they have to cough. This results in the audience complaining about something that isn’t there.

The solution: This time he rents a haze machine. It generates the same light beam effect, but the smoke is invisible. There’s only one downside. This invisible smoke is oil based which sounds less healthy to me compared to water based smoke. But people won’t see smoke, so they don’t have to cough… It’s not the smoke you make, it’s the smoke people see