Knowing The Customer

Maxine Clark has been viewed as the strategic visionary—and even the genius—who has made the Build-A-Bear concept work. But her success as CEO derives from more than just business skills relating to strategy development and implementation. Clark attributes her success to "never forgetting what it's like to be a customer." Given that Clark has no children of her own, this is an amazing feat indeed. Although understanding customers is certainly not a new concept, Clark has employed both low-tech and high-tech methods for making Build-A-Bear a truly customer-centric organization.

To put herself in the customer's shoes, Clark walks where they walk. Every week, she visits two or three of the more than 370 Build-A-Bear stores. She doesn't do this just to see how the stores are running operationally. She takes the opportunity to interact with her customer base by chatting with preteens and parents. She actually puts herself on the front line, assisting employees in serving customers. She even hands out business cards.

As a result, Clark receives thousands of e-mails each week, and she's added to the buddy lists of preteens all over the world. Clark doesn't take this honor lightly, and tries to respond to as many of those messages as possible via her BlackBerry. Also, to capitalize on these customer communications, she has created what she calls the "Virtual Cub Advisory Council," a panel of children on her e-mail list. And what does Clark get in return from all this high-tech communication? "Ideas," she says. "I used to feel like I had to come up with all the ideas myself but it's so much easier relying on my customers for help."

From the location of stores to accessories that could be added to the Build-A-Bear line, Build-A-Bear actually puts customer ideas into practice. As the ideas come in, Clark polls the Cub Council to get real-time feedback from customers throughout the areas where the company does business. Mini-scooters, Hello Kitty bears, mascot bears at professional sports venues, and sequined purses are all ideas generated by customers that have become very successful additions.

Clark sees accessories as a tool for building the child/bear relationship. Build-A-Bear Workshops house in-store galleries of bear-sized furniture designed by kids for kids. An exclusive partnership with Skechers shoes makes Build-A-Bear Workshop the seller of more bear shoes, sandals, boots, and slippers than any other company worldwide. And with the sports licensing agreements that it has with the NBA, WNBA, MLB, NHL, NFL, and NASCAR, Build-A-Bear's offspring can become part of a child's affinity for a sports team. Clark's research efforts have also lead to a media campaign focusing on the tween segment by playing up ideas of fashion and imagination.

As a means of further expanding the Build-A-Bear experience beyond the retail store, the company has created a Web site that connects real-world toys with the online world. Dubbed "BuiidABearVille.com," the interactive site contains games and activities that feature the same themes as the brick-and-mortar stores. "The new virtual world was carefully created so that it reflects the core values of Build-A-Bear Workshop," Clark said. "It allows children to have fun as they grow their friendships and learn about being an active participant in the community." Although any child can register, the premium content is only accessible via a code that comes with the purchase of a bear from one of the chain's retail stores.

But growth for Build-A-Bear will come from more than just these improvements to same-store sales. Clark's expansion efforts include building a base of at least 350 stores in the United States, 120 stores in Europe, and franchising an additional 300 stores in other parts of the world. And Clark is taking action on the flood of "build-your-own" concepts that have come across her desk since the first Build-A-Bear Workshop opened. She will give much more attention to a new line of stores called "Friends 2B Made," a concept built around the personalization of dolls rather than stuffed animals. She's opened up the first "Build-A-Dino" stores. And Build-A-Bear has a 25 percent ownership stake in the start-up "Ridemakerz," a make-and-outfit your own toy car shop.

Although Maxine Clark may communicate with only a fraction of her customers, she sees her efforts as the basis for a personal connection with all customers. "With each child that enters our store, we have an opportunity to build a lasting memory," she says. "Any business can think that way, whether you're selling a screw, a bar of soap, or a bear."

Questions for Discussion

1. Give examples of needs, wants, and demands that Build-A-Bear customers demonstrate, differentiating each of these three concepts. What are the implications of each on Build-A-Bear's actions?

2. In detail, describe all facets of Build-A-Bear's product. What is being exchanged in a Build-A-Bear transaction?

3. Which of the five marketing management concepts best describes Build-A-Bear Workshop?

4. Discuss in detail the value that Build-A-Bear creates for its customers.

5. Is Build-A-Bear likely to be successful in continuing to build customer relationships? Why or why not?

Sources: James Bickers, "Virtual Friends," Retail Customer Experience, April 2008, p. 20; Joanne Kaufman, "After Build-A-Bear, Build-A-Toy-Car," New York Times, May 29, 2007, p. C3; "Build-A-Bear Brings Out the Bulls," BusinessWeek, June 28, 2007, accessed at www.businessweek.com; Lucas Conley, "Customer-Centered Leader: Maxine Clark," Fast Company, October 2005, p. 54; Staff writer, "This Bear Doesn't Hibernate," BusinessWeek, June 6, 2005, accessed at www.businessweek.com; and Roger Crockett, "Build-A-Bear Workshop: Retailing Gets Interactive with Toys Designed by Tots," BusinessWeek, June 6, 2005, p. 77.

Chapter 2

Parti Defining Marketing arid the Marketing Process (Chapters 1, 2)

Part 2 Understanding the Marketplace and Consumers {Chante. 3,4,5,6}

Part 3 Designing a Customer-Doyen Strategy end Mix Chapters 7, 4 9, TO,

Part 4 Extending Marketing (Chapters 18. 19,20)

Company and Marketing

Strategy

Partnering to Build Customer Relationships

In the first chapter, we explored the marketing PRE process by which companies create value for consumers in order to capture value from them in return. We will now dig deeper into steps two and three of the marketing process—designing customer-driven marketing strategies and constructing marketing programs. First, we look at the organization's overall strategic planning, which guides marketing strategy and planning. Next, we discuss how, guided by the strategic plan, marketers partner closely with others inside and outside the firm to create value for customers. We then examine marketing strategy and planning—how marketers choose target markets, position their market offerings, develop a marketing mix, and manage their marketing programs. Finally, we look at the important step of measuring and managing return on marketing investment.

But first let's look at the Olympic brand. Staging an Olympics is an enormous challenge for any city or country. Not only do venues and accommodations need to be constructed for the Olympians, but also the infrastructure of the Olympic city needs to be transformed. In order to achieve success, these physical issues have to be addressed, along with the ability to market the spectacle to an ever-broadening world audience. None of this is possible unless sponsors are brought onboard at the earliest opportunity, and they are able to see tangible benefits from their involvement.

The Olympic brand is a powerful worldwide symbol representing not only sports, but a celebration of the best in the world and an opportunity for nations to join together and compete for glory. The Beijing Olympics in 2008 was immensely popular worldwide and successful, delivering a quality experience for the athletes, spectators, and millions of viewers around the world. It was also vital in rebranding and repackaging China as a modern nation. China hoped that the Olympics would help it forge business links that would propel the country forward. The massive effort to deliver the games was not without cost; billions were invested, and some of this funding came from sponsors and partners.

The London 2012 Olympic Games promise to be another tremendous spectacle, although the budget is only roughly half of what Beijing's was. Yet sponsors and partners from Visa and Coca Cola to Adidas and British Airways have already signed up. The purpose of the partnerships is not merely financial; it is about building customer relationships, both for the games and for the businesses.

On a slightly less grand level, the Olympics provides smaller businesses with an opportunity to be involved, provide products and services, and promote the fact that they have an association with the 2012 Olympics. In June 2008, before the Beijing Olympics had even got underway, the latest London 2012 "business-engagement" figures were published. Business engagement refers to the numbers of companies registered with the Olympics to provide the event with products and services. Nearly 90 percent of the registered companies (18,000) were small-to-medium sized.

The Olympic Delivery Authority (ODA) and London Organizing Committee (LOCOG) will, in the coming months and years, allocate over $9 billion of work to various businesses. There will be at least 75,000 business opportunities, including the direct contracts and the supply chains used to fulfil those contracts. John Armitt, the ODA chairman, had been involved in numerous discussions with British businesses and had found that an enormous number were keen to be involved in the London 2012 Games. At this stage it was smaller businesses that were finding opportunities, many being able to establish themselves as key providers with experience in dealing with a project of this size. Armitt believed that this would put them in a prime position to compete with even larger contractors in the future. Armitt recognized it was a challenging project and it needed the best British businesses to keep it on track.

The Organizing Committee's Chief Executive, Paul Deighton, was suitably impressed with the British business response to the London 2012 Business Network. The London 2012 procurement team and business development partners had worked hard to encourage as many businesses as

The Olympic logo is one of the world's most powerful brands, attracting sponsorship deals from companies all over the world.

possible to become involved at some level in providing goods and services. The push would go on into 2009, with increasing numbers of U.K. businesses registering on the CompeteFor system. By registering on this system Deighton was certain that the businesses would not regret getting involved in the Games, as it represented a "lifetime business opportunity."

Tessa Jowell, the Olympics Minister, says "The fact that 70 percent of the 650 companies that have already won work supplying the games are small- and medium-sized firms demonstrates the potential for the business benefits of London 2012 to provide a boost to the whole economy. Since January this year [2008], companies have been signing up at a rate of 500 per week, a clear illustration of the value of the system and the determination of British business to grasp the economic opportunities the games offer. Beyond delivering London 2012 on time and on budget, our ambition is to use the games to raise skills levels, tackle worklessness, and promote long-term growth, leaving a legacy of better trained workers and a more efficient business environment."

Commenting on the fact that being associated with the Olympics is a positive, beyond the value of any contract that a business might be able to secure, Lord Digby Jones, the U.K.'s minister for Trade and Investment notes, "International sporting events offer huge opportunities for U.K. businesses. However size doesn't matter when it comes to British companies winning business in the 2012 London Olympic and Paralympics' Games. Hundreds of small- and medium-sized businesses have already won contracts with billions of pounds of contracts still to win. Large or small, winning that business for 2012 will provide a springboard for global growth, and an opportunity to promote our capabilities on the international stage."

Clearly, the marketing opportunities are enormous for partner businesses and suppliers to the Olympics. However, one of the key concerns is the use of the Olympic logos by businesses that have nothing to do with the event. According to intellectual property expert Tracey Huxley, "The outstanding success of Team

ran a series of advertisements with medal-winning athletes that feature the phrase: "Impossible is Nothing." The British-orientated advertisements also included the U.K.'s gold-medal winning men's cycling pursuit team with the following tagline: "Awesome away . . . Imagine them at home." Likewise, Lloyds TSB ran a series of advertisements featuring future Olympic hopefuls, and Visa's advertisements proudly announced "The Journey to London 2012 Starts Now."

However, in light of the legislation introduced primarily to stop ambush marketing as seen in previous Olympics, it is extremely easy to fall foul of the restrictions, says Huxley. Ambush marketing tends to come in two different forms—they either falsely imply that the business has an association with the Olympics, or they involve giving away branded products that will be taken into a stadium where they will be seen by viewers if the event is televised. "In fact, the burden of proof in many cases will be reversed, so an infringement will be presumed unless the accused

Impossible is nothing: Adidas was one of the main sponsors of the Beijing Olympics in 2008. The company's ad campaign featured medal-hopeful athletes from countries across the globe, reflecting the aspirational nature of Adidas' target markets.

Great Britain in China this summer is likely to encourage companies to use the swell of national pride and the gathering momentum of London 2012 in their marketing, both in the immediate future and throughout the next four years. Adidas, for example, sponsored both the Beijing Games and is a partner with London 2012. The company

The huge commercial possibilities of being associated with the Olympic brand cannot be underestimated. Businesses that either sponsor the Olympics or those that provide products and services, or for that matter suppliers, make full use of their association with the Olympics. This consists of a full partnership approach aimed at securing and building customer relationships. Before the Beijing games were even over, the push to be associated with London 2012 Olympics Games had begun.

can prove their innocence," Huxley adds. "Brands must therefore be mindful of the restrictions which are already being enforced, or face the consequences. In particular those with licensees or franchisees need to ensure that they, too, are aware of the rules and don't go too far, as this may also draw the brand owner into the infringement."1

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Responses

  • Filippa
    What is the value that BuildABear creates for its customers?
    8 years ago

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