Getting Fickle Consumers to Buy Into Your Brand

While big corporations are struggling to retain customers, startups are seizing the opportunity to steal loyal consumers. Here is how they are doing it.

Gone are the days when big brands depended on generational loyalty – “my mom bought Dove, so I buy Dove” — to maintain their bottom line, and the status quo.

While that might make it tougher for major manufacturers, the fact that consumers are less interested in staying loyal to brands is actually good news for up and comers and smaller players. That is, if you know the three secrets for creating loyalty.

Over-deliver on your product’s promise every time. The benefits of your product have to be apparent and consistent.

For instance, if you say your yoga pants fit great, ensure high quality and will look like new wash after wash make sure they do. That’s the lesson Lululemon’s founder Chip Wilson learned after he responded to customer complaints about the once red hot brand’s garments pilling and becoming see-through when the wearer got in child pose (or any other bending stance) with the observation that not everyone is fit or thin enough to pull off his company’s pants. He neglected to address the other quality issues.

Fix mistakes promptly.  If you screw up on a product promise, fix it. In fact, consider making the fix into part of your brand’s narrative.

Don’t blame the consumer, which is what Wilson did when he implied some customers were too fat to wear Lululemon’s clothes.  Even fit women, who tend to look good in nearly transparent yoga pants, got offended and chose another brand. Good quality yoga pants are easy enough to find — and find them they did.

Instead of following in Wilson’s footsteps, recall how the apology plus brand narrative worked for Domino’s Pizza CEO Patrick Doyle. If you recall, Domino’s Pizza was having a quality issue of their own back in 2010. Doyle participated in a national ad campaign, apologizing to the public after he acknowledged that the company had forgotten how to produce pizza people actually wanted to eat. In the same year, Starbucks’ CEO Howard Schultz discussed mistakes his company made when it nixed the baristas in favor of crazy drink concoctions and in the process lost its neighborhood coffee house appeal.

3. Don’t discriminate, target.  Do you really want to be known as a brand who does not want to serve specific groups of people? So far, Lululemon has resisted calls by some women’s groups to create larger sizes of yoga pants (it stops at size 12). It doesn’t seem to understand that yoga is for fit people, not necessarily thin people. (Remember, fit people come in all shapes and sizes.) Targeting the fitness aspect of a yoga brand — including the aspiration to fitness — would be a much smarter strategy than targeting thin people only. And it will get you into less trouble.

This article originally appeared on entrepreneur.com and was written by Debra Kaye.

Why it's hard to charge $40 for a pork chop

I’m in a high-brow part of New York at a high brow restaurant and I’m about to eat… a brow. “This is pig’s head. Enjoy,” laughs Nick Anderer, executive chef at Maialino restaurant in New York’s Grammercy Park neighborhood. Actually, it’s half a pig’s head, brined, deep fried and served on a salad. Teeth and all.

Crispy Suckling Pig Face has become one of most popular dishes at Maialino (‘suckling pig’ in Italian). Pig face’s popularity surprised Anderer. “I was completely surprised,” says Anderer. “I never thought that a dish of a pig’s face on a plate would sell as much as this one does.”

Part of the push to use more pig parts has to do with pork prices, which hit a 30 year high last year.

“When corn goes up, everything goes with it,” explains Steve Meyer, president of Paragon Economics, an agriculture market consulting firm. Meyer says pigs eat a lot of corn and corn prices have been at record highs. They’ve dropped a lot recently, so pork prices were poised to plunge, but now a deadly illness from China is hitting pig populations in the US. “Now we’re facing some supply challenges caused by a viral disease in baby pigs that might keep them high as we go through this next year as well,” says Meyer.

While the supply of pigs might be shrinking, demand for pork has been flying high. “Bacon has been a very big food trend,” says brand consultant Debra Kaye, author of Red Thread Thinking. Kaye says our cultural tastes have evolved and we are embracing bacon like never before. “We started to see that sweet, smoky, salty could go together… and what is better salty and smoky than bacon? And that’s where it really started to take off.”

Case in point: bacon donuts, bacon cocktails, bacon chocolates, bacon-flavored vodka, bacon ice cream, bacon lip balm…

All this new demand + low supply = the price of pork goes up…

Econ 101, right?

Maialino chef, Nick Anderer says it’s not quite that simple. “Yes, pork prices spiked,” says Anderer. “But we made no price hikes in our dishes because we just didn’t feel like the perceived value would be there. Ultimately, pork is a comfort food for me and once you start charging luxury prices for it, it starts taking it into a realm that I don’t feel comfortable with.”

Restaurants can get away with big mark-ups for beef. Here in New York a fancy restaurant can charge $40 for a ribeye, but pork is kind of the people’s meat. It’s hard to charge $40 for a pork chop. Restaurants can’t *not offer pork, because we’re a nation obsessed with bacon.

Faced with this pork pricing puzzle, Anderer’s done two things. The first is stretching the pork: “It’s such a great seasoning agent that it doesn’t need to be the main focus of a dish,” says Anderer. “It can just be a few ounces of torn meat with the malfatti pasta and arugula and you’ve got yourself a great dish.”

The other solution is to use more parts of the pig. “We sell a lot more weird pork dishes now than we did before,” says Anderer, including charred pig hearts, pig liver crostini, crispy pork skin served with vinegar and, of course, pig face.

Brand consultant Debra Kaye says our deep love of bacon is pushing us to boldly brave new frontiers of pork eating. She agreed to try Anderer’s famous pig’s face. He offered her the ear, which he says he usually eats first.

“That is so good, oh my god,” says Kaye. “The thing I give Figaro, my dog, for dessert every night is a pig’s ear. I don’t think I want to give it to him anymore they’re so good.”

The pork puzzle for people may be solved for this year, but the pork puzzle for dogs may be just beginning.

Rooms for Rest in New York City

Metro Money: Anne Kadet Scopes Out Places to Go

Last week, Wayne Parks unveiled a long-cherished business idea—a chain of members-only Manhattan rest stops where folks paying $6 to $8 a day can stow their gear, charge their phones, shower and relax. To his surprise, the resulting buzz focused on just one aspect of the service: the commodes. “The luxury bathrooms are only a small part of the plan,” he says. “Why the fascination with the toilet?”

He’s being a bit disingenuous. The Fairfield, Conn., construction executive makes frequent trips to the city, and he’s all too familiar with the frustrations of attempting to find a clean restroom. It’s part of what inspired him to start Posh Stow and Go, launching this June in Midtown. “I just can’t stand dirty bathrooms,” he says.

Having researched pay-toilet history, he’s also an expert on foiled efforts. Until the 1970s, diners and gas stations around the city offered dime-operated stalls. Genius idea, right? Then along came an evil outfit known as the Committee to End Pay Toilets in America, arguing that the practice was discriminatory because men used urinals free of charge while women had to pay for stalls. In 1975, the pay stall was banned in New York.

Since then, the city has made several efforts to launch its own pay-toilet program. In 2008, it announced a plan to install 20 self-cleaning toilets around the city through Cemusa, a private contractor that shares revenue earned from its ad-bearing street furniture. But the city has had trouble finding decent locations. As of now, there are only three.

The most popular, boasting up to 75 visitors a day, is on Madison Avenue just north of 23rd Street. With its sleek metal exterior, the $500,000 contraption looks like a cross between a meat freezer and a spaceship. “15 minutes max,” reads a sign on the front. “No smoking.” I slipped a quarter in the slot and the door slid open. The toilet gave a welcoming flush.

Little did I know it was up to no good. Everything went fine until I tried to leave. I pressed the green exit button. Nothing. I pushed it again. Nada. I pounded on the door and shouted, hoping a pedestrian might come to my rescue. I even tried the yellow assistance button. The phone rang, but no one picked up.

There was nothing to do but wait. I read some email and checked the web to see if prior users had reviewed the facility. “Really cool!!!!” one person wrote. “Kinda like a wet prison bathroom.”

I’ll say!

I felt relieved when a yellow light started flashing, indicating that my 15 minutes was almost up. Sure enough, the time expired and the door slid open. No harm done. But in general, when I use a restroom, I like to be the one who decides when I leave.

A Cemusa spokeswoman says no one has ever gotten trapped inside before: “Lucky for us, you’re the first.”

I’ve had better pay-toilet experiences in Coney Island, where Deno’s Wonder Wheel Amusement Park runs a fee-for-flush operation in the shadow of its giant Ferris wheel. Co-owner Dennis Vourderis says his family charged a dime until the 1980s, when they renovated the facilities and hiked the price to a quarter. It’s a popular attraction—a hot summer day sees more than a thousand guests. Still, Mr. Vourderis estimates his total toilet revenue at $15,000 a year, barely enough to cover the cost of water, TP and an attendant.

For many New Yorkers, the lavatory of choice is at Starbucks, beloved for its single-toilet facilities that provide the privacy of your own little room. Indeed, there was a minor panic in 2011 when a rogue band of Midtown baristas started locking the restroom doors. Debra Kaye, a partner with Manhattan branding consultancy Lucule, says chains like Starbucks have an incentive to make their restrooms available: “If you’re known for clean bathrooms, that’s an asset that will really help your business,” she says. “And in New York, we’ve been trained. You don’t just go. We try to buy something.”

Many New Yorkers grouse that Starbucks is the only option, and complain of the long lines. But they just aren’t being adventurous. Indeed, the city’s tourism office, NYC & Company, has a web page devoted entirely to the question of where to go in Manhattan. The most intriguing suggestion? “New York City Police Department stations will let you use their bathrooms if you ask.”

It’s true. I stopped by the 13th Precinct on East 21st Street. The place was a bit intimidating, what with the special offers posted at the door ($100 cash for guns) and the crowd-control gates in the lobby. But when I asked to use the facilities, they waved me right in. I was tickled to find my stall adorned with verse: “If you sprinkle when you tinkle, please be neat and wipe the seat.” Cops! They’re so adorable!

There are also free phone apps that map public restrooms around town. I tested three and found SitOrSquat the most comprehensive, listing more than 3,000 locations. Using this app is like donning magic glasses. Suddenly, there are restrooms everywhere. Indeed, the question isn’t how to find a place to go, but how to choose among all the fabulous options.

So what’s the best public restroom in New York? Some point to Henri Bendel on Fifth Avenue, which offers stalls the size of studio apartments and a lounge where you can flop on the leather sofa and read coffee-table books.

The restrooms in Bryant Park also have their charms. Situated in a little stone building on 42nd Street that looks alarmingly like a mausoleum, they feature fresh flowers, classical music and a full-time attendant. The automatic seat-cover dispensers are especially exciting.

But to my mind, the best seat is the handicap stall at the Plaza Hotel just inside the lobby’s Rose Club. Never mind the padded bench, Miller Harris toiletries and fragrant spring blossoms, the softly lit marble and mahogany stall offers its own private sink, dressing table and ornate, gilded mirror. Now that’s more like it!

Alas, hotel Managing Director George Cozonis warns that due to their small size, the bathrooms “can only accommodate a very limited number of outside guests.”

The rest of us, I suppose, can use the bathroom downstairs in the food court. Just be prepared to supply your own flowers.

—anne.kadet@dowjones.com

This article originally appeared on WSJ.com

Checking in on President Obama's pay hike request

President Barack Obama has proposed raising the federal minimum hourly wage to $10.10 from $7.25. One reason why a minimum wage could be the most recent focus of attention for the president? The White House released a white paper on long-term unemployment trends in January that included this statistic: laid-off workers face 15 percent lower wages after being re-employed compared to workers who have been continuously employed.

Raising the minimum wage is one way to make sure long-term unemployed workers can find jobs that pay at least as much as what they were making before, though the Congressional Budget Office recently stated some of those available jobs might disappear under a federally-mandated raise, a concern which the National Retail Federation echoed in its official response.

In lieu of changing the law, some major employers in the United States have responded to the president’s second wish. Which companies have chosen to voluntarily raise the minimum hourly wage they offer their individual employees?

On Thursday, Gap said it would raise the hourly pay for its U.S. employees to $9 in June 2014 and $10 in June 2015. Gap is the parent company of Old Navy, Banana Republic, and Gap said the increased pay will benefit about 65,000 store employees. (CNBC)