Playing the Grants Game For Art and Preservation

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This article was prepared for the November 21, 2001 edition of

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Retailers Need All the Channels They Can Get

Christmas — the shopping event that begins before

Halloween — is upon us, and all eyes are on cash registers. Our

economy, indeed our entire way of life, we are told, hangs on the

degree to which shoppers get out there and snap up clothes, home

furnishings,

and electronic goodies in the coming weeks.

So buy we must. But among the questions consumers face is — where?

Retailers hang on the answer.

For as vital as mass year-end shopping may be to the economy at large,

it is life or death for individual retailers already confused about

where to put their resources. Another storefront? A better Internet

site? A catalog?

Bernadette Tiernan suggests that savvy retailers use all three

to lure shoppers to their wares. She wrote her new book, The Hybrid

Company, before September 11. Subsequent events only add urgency to

her prescription for achieving better results through multiple selling

channels.

"If people have fears in the channel that is your only channel,

what do you do?" she asks. Internet warnings about mall attacks

have scared away shoppers — even though they turned out to be

hoaxes. Anthrax fears are causing some to poke catalogs into the dust

bin with a long stick. And concern over credit card safety on the

Internet lingers.

As if all of that wasn’t enough, Tiernan points out that many

potential

shoppers are exhausted this year. "With the downsizings, everyone

has more to do," she comments. "Sometime you just feel like

lying around with a catalog."

All of this means that retailers — now more than ever — need

all the selling channels they can get. Forget the debate about which

is better — an Internet site or a storefront. Businesses need

both, and they should have catalogs too.

Tiernan founded Tiernan Associates, a Ridgewood-based consultant firm

for small businesses, in 1986. Over the past 10 years, one of her

clients was the New Jersey Small Business Development Centers. In

January, she will become associate director of the state-wide SBDC

(www.yourbizpartner.com). She is now director of E-Business Education

for the SBDC at the Rutgers Graduate School of Management. She also

teaches Rutgers undergraduate courses in E-business.

In this excerpt from The Hybrid Company (Dearborn Trade Publishing,

$27), she explains what a hybrid company is and why its multiple

channels

provide stability in any sales environment:

The hybrid company. Hybrid, according to the Random House

Dictionary, describes anything derived from heterogeneous sources

or composed of elements of different or incongruous kinds. Hybrid

companies are a synergistic combination of E-commerce, a physical

presence (such as a storefront, a kiosk, or an open office), and some

form of print (such as catalogs of all shapes, sizes, and quality).

Corporations with a hybrid structure in both their physical form and

their marketing endeavors have the highest profitability and longevity

rates.

Main Street lives. A bold Going Out of Business sign

covered

the storefront window of a boarded-up shop in a full-page New York

Times ad that accused E-commerce of the demise of community. "Why

this crusade against small business, while we subsidize trendy titans

of E-commerce?" the ad questioned, addressing the tax moratorium

for online sales.

Can’t these poor dot-coms get a break? First, we unilaterally and

collectively blamed them for the demise of our retirement funding

when their stock values plummeted. Then they were accused of attacking

America’s heartland in an assault on human contact and the

proliferation

of a culture of isolation. Many of these dot-coms weren’t titans;

some weren’t even trendy.

Statistics failed to support prophesies of doom and destruction for

malls and Main Street. In fact, for several consecutive holiday

seasons,

consumer sales figures soared exponentially for all of retail, online

and offline. In addition, both business-to-business E-commerce and

traditional sales experienced dramatic growth. The predicted

cannibalism

of traditional sales venues by competitive dot-coms never occurred.

If anything, the dot-coms influenced the extension of the holiday

shopping season into one big bonanza of event after event. Seasonal

December peaks were repeated in the first quarter for several years.

Online merchant promotions of all holidays from Valentine’s Day

through

Thanksgiving influenced sales in traditional stores too. No month

passed without a hyped-up holiday, and both online and offline sales

channels benefited.

Combined channels. Online "hot-coms" and offline

traditional companies have realized a synergistic effect by leveraging

a multiple-channel approach to their business. Aspiring to new IPO

heights by adding ".com" to the corporate logo is no longer

enough to inflate stock value. Our infatuation with dot-coms is over,

and we’re back to a competition of survival of the fittest. Survivors

of the Internet community challenge include tribal members of the

B2B (business-to-business) and the B2C (business-to-consumer) markets,

all advancing toward their billion dollar prizes. A new breed of

hybrid

companies have emerged as the healthiest survivors.

A hybrid company is a business that reaches its customers through

multiple channels of clicks, bricks, and catalogs in a seamless,

integrated

entity. Hybrid companies assimilate E-commerce websites, a physical

presence, and catalogs; each channel promotes and reinforces every

other channel. Although some hybrid companies can operate successfully

with two out of three channels, the E-commerce channel is imperative

in every hybrid model.

Options. Clicks. Bricks. Catalogs. The most profitable

hybrid companies demonstrate a deliberate, step-by-step expansion

from channel to channel, mastering one mode and rapidly expanding

to additional channels. Two channels constitute a hybrid company;

however, the most successful hybrid companies operate with all three

channels. Not two or three separate businesses under one name, but

a unified front. Some may accomplish their mission by strategic

alliances

of separate companies, but these alliances are invisible to customers

or clients. Customers always see an integrated entity and always

assume

they are dealing with one company.

Extinction. Incentives to move quickly to a hybrid company

model are strong. Some experts predict that 80 percent of E-tailers

who do not partner with a traditional retail company face extinction.

Retailers with a combination of physical stores, catalogs, and Web

sites tend to do more business than companies with just one channel,

according to a study for the National Retail Federation (NRF).

Cross-channel

integration provides a competitive advantage, according to this study.

Online shoppers tend to cross-shop frequently. And online shopping

has injected energy into shopping in general, building brand and

customer

loyalty in multiple channels. A report by Jupiter Communications (now

Jupiter Media Metrix) revealed that multi-channel shoppers purchase

30 percent more than those who use only one channel.

B-to-B and B-to-C. Hybrid companies thrive in both the

business-to-business and business-to-consumer sectors. The

business-to-business

potential for hybrid companies is the most dramatic. Businesses are

expected to purchase almost 30 percent of their products

electronically

by 2004, and transactions from E-marketplaces will produce nearly

33 percent of the $2.78 trillion B2B E-commerce total, according to

the Yankee Group. Forrester Research predicts that E-marketplaces

will produce 53 percent of these transactions. The impact of the

Internet

is expected to generate more than $6 trillion in trade by 2005,

according

to Jupiter Communications.

More channels, more spending. Consumer online spending

is expected to reach almost $184 billion by 2004, or about 7 percent

of all retail sales, according to Forrester Research. Jupiter

Communications

has predicted that by 2005 consumers’ online research will result

in at least $632 billion in sales at traditional storefronts and from

catalogs. Consumer spending for online and Web-influenced offline

purchases, reflecting the momentum of hybrid companies, will exceed

$831 billion in 2005, according to Jupiter.

Traditional storefront and catalog retailers have taken the holiday

online shopping lead over Internet pure-play E-tailers for several

consecutive years, by over 29 percent according to research by

BizRate.com. The bricks channel, for example, has provided an

advantage in

the sale of more expensive items, like computers and home video

equipment,

according to a study by San Francisco market research firm King, Brown

and Partners.

The appeal of physical shopping as a form of entertainment,

socializing,

and exercise has its own time and place, whether one is hunting for

a personal or a business product. And the catalog convenience of

circling

favorite items, marking special pages by folding the corners,

reviewing

wish lists with kids or coworkers, browsing poolside or on a commuter

bus, also serves its unique purpose.

For regions without mall density, catalogs are more than a convenience

— they’re a lifeline. Will either the store or catalog purchasing

channel be superseded by E-commerce? It no longer appears likely,

and the prophets of gloom are quieting down. Whether buying business

equipment or vacation sportswear, the Internet presents a convenient

tool for comparative shopping through price and product research,

even if the final purchase is sometimes transacted at a company’s

storefront or through a catalog. The companies that take maximum

advantage

of multi-channel selling and marketing stand to reap the greatest

rewards, directing customers to their clicks, bricks, and catalogs

while offering specialty items at each venue to keep every component

fresh.

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Playing the Grants Game For Art and Preservation

New Jersey’s Department of Cultural Affairs is holding

a free day-long event to describe the support that the state gives

to artists, art groups, art educators, and those involved in historic

restorations. "On the Road — A Constituent Outreach

Program"

takes place on Tuesday, November 27, beginning at 9 a.m. at the

Collingswood

Senior Center. Call 609-292-4485.

At the event the NJ Historical Commission describes its $4.7 million

annual grants program. Grants range in size from under $500 to over

$600,000. and can be used to fund general operating support,

exhibitions,

public programs, fellowships, educational initiatives, conservation

of historical materials, media projects, research, publication, and

other activities.

The NJ Historic Trust also has grant money available. It provides

grants of up to $750,000, loans up to $425,000, and planning grants

of up to $50,000 toward the preservation, restoration, rehabilitation,

and adaptive use of historic buildings, structures, and landscapes.

The New Jersey State Council on the Arts’ grants include program and

project grants, community collaboration grants, and artists’ service

grants. Council representatives explain how to apply for these grants,

and also speak on how to locate artists and arts groups for programs.

Speaking to another resource, this constituent outreach program

contains

a presentation on using New Jersey’s public records and archives.

This session introduces the rich holdings and history research

services

of the New Jersey State Archives, and the public records technical

services of the Division of Archives and Records Management.

Other sessions on this Constituent Outreach Day include information

on volunteerism, youth and the arts, the New Jersey Museum, and the

New Jersey Commission on American Indian Affairs. The latter ensures

that American Indian communities within New Jersey have full

opportunities

to develop and preserve their own cultural, educational, social, and

economic welfare as well as contributing to and participating in the

ongoing life and development of the state.


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