What do Neiman Marcus and Nascar have in common?
Not much aside from the fact that they both start with the letter “N," they're both into brand names for clothing, and it just so happens that right now they're both in the same position of evaluating their current client base and making adjustments for improvement.
For Nascar, it’s a matter of winning back the loyal fans who slipped away during the recession. Last year, the Daytona 500 had an audience of 8.8 million which was way down from the 12.5 million viewers in 2006, not to mention there was a steady decline in the race stand attendance as well.
So what are they doing about it? After polling 12,000 of its fans, Nascar made some changes and we're not talking about lanes. The organization ridded its racecars from “wing” spoilers that made them look like a convoy of Honda Civics off the set of “Pimp My Ride.” There will no longer be penalties against drivers for minor acts of aggression like shoving, swearing, and rubbing bumpers. Plus the Dayton International Speedway now allows fans to carry-in as many as 36 cans of beer as opposed to the former maximum of a 6-pack. And the results? Well, we’ll know more after this coming Sunday’s Daytona 500.
For Neiman Marcus, it’s a move to attract more of its less affluent customers. Traditionally, Neiman Marcus targets the approximately 100,000 people who spend upwards $12,000 a year in its stores – a group which accounts for half of its sales! In December of 2008 however when sales plummeted more than 30%, the company knew it would have to make changes and we're not talking about outfits.
So what did they do about it? 18 months ago, the retailer began broadening its luxury lines to included lower priced merchandise that would be more affordable to a population they title as “aspirational” – those with a net worth of below $1 million. And the results? This past January, Neiman Marcus posted positive trends with not only a sales gain of 9.8% in January for stores open at least a year but also a sharper sloped increase in revenue over its competitors Saks and Nordstrom.
Neither Nascar nor Neiman Marcus had to change their business, their values, or their story. The closing line of Nascar’s history section on its website reads: “But no matter the year, there have always been – and always will be – constants: Close, safe competition, fair stewardship and drivers who are genuine American heroes.” The corporate profile of Neiman Marcus summarizes its purpose as: “We have stayed true to the principles of our founders – to be recognized as the premier luxury retailer dedicated to providing our customers with distinctive merchandise and superior service.”
The “WHY we do what we do” – or what eQ calls a company’s story – did not have to change but the “HOW we do what we do” – or what eQ calls a company’s processes – did alter a little to fit a broader audience. For Nascar, it was going back to its most loyal fans and figuring out what they defined as the behavior of “genuine American heroes.” For Neiman Marcus, it was reaching forward into a broader market that would allow it to retain its claim to luxury but reinforce its position as premier.
The importance of aligning a business' processes with its story cannot be reiterated enough. And while we’ll have to wait for their fiscal futures to unfold before we can be certain, it’s very likely that both Nascar and Neiman Marcus will soon have one more thing in common: corporate growth.
Kristen Zatina is a writing specialist at entreQuest who scours worldwide business news for corporate inspiration.
(Information Sources: "Neiman Marcus Opens Customer Door Wider" by Rachel Dodes. The Wall Street Journal. Tuesday 15 February 2011.
"Nascar Revs Up Rough Side to Win Back Fans" by Valerine Bauerlein. The Wall Street Journal. Monday 14 February 2011.
