Adam Markulics, Allison Guild, Elizabeth Urbaniak, Alex Britz

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Background……………………………………………………………………………………………………………………………………………………….……………………………………………..Page 3 Store Location………………………………………………………………………………………………………………………….………………………………………………….……………………Page 4 Storefront…………………………………………………………………………………………………………………………….…………………………………………………………….…………….Page 4 Entrance and Store Layout…………………………………………………………………………………………………….………………………………………………………………….. …….Page 5 Theme & Decor………………………………………………………………………………………………………….……………………………………………………………………………………..Page 6 Store Layout Illustration…………………………………………………………………………………………………….……………………………………………………………………………..Page 7 Positioning……………………………………………………………………………………………………………….…………………………………………………………………………………….…Page 8 Target Market………………………………………………………………………………………………………….……………………………………………………………………………………….Page 9 Competition……………………………………………………………………………………………………………………………………………………………………………………………..…....Page 10 Products Sold…………………………………………………………………………………………………………………………………………………………………………………………..……..Page 10 Methods……………………………………………………………………………………………………………..………………………………………………………………………………………….Page 11 Observations………………………………………………………………………………………………………………………………………………………………………..……………….….Pages 12-17 Time Spent In Store………………………………………………………………………………………………………………………………………………………………..…....Pages 12-13 Sales Interactions…………………………………………………………………………..…………………………………………………………………………………………..……...Page 14 Attention Grabbers…………………………………………………………………………………………………………………………………………………………..…………………Page 15 Signage……………………………………………………………………………………………..………………………………………………………………………………………………..Page 16 Store Atmosphere…………………………………………………………………………….……………………………………………………………………………………………..….Page 17 Merchandising……………………………………………………………………………….…………………………………………………………………………………………..……...Page 18 Recommendations……………………………………………………………………………………………………………………………………………………………………..…………….Pages 19-24 “Draw Customers In”…………………………………………………………………………………………………………………………………………………………………...……..Page 19 “Keeping Customers In”………………………………………………………………………………………………………………………………………………………..…………….Page 20 “Watch the Butt!”…………………………………………………………………………………………………………………………………………………………………..……………Page 21 “What about me, honey?”………………………………………………………………………………………………………………………………………………….……………….Page 22 “Windows Sell”……………………………………………………………………………………………………………………………………………………………………………..…...Page 23 “Shopping Bags”……………………………………………………………………………………………………………………………………………………………………………..…..Page 24 Appendix A: Interview Questions………………………………………………………………………………………………………………………………………………………..…………..Page 25 Appendix B: Observation Schedule………………………………………………………………………………………………………………………………………………………………….Page 26 Appendix C: Observation Questions………………………………………………………………………………………………………………………………………….…………………….Page 27 Appendix D: Customer Interviews…………………………………………………………………………………………………………………………………………………………….Pages 28-31 Appendix E: Observation Record………………………………………………………………………………………………………………………………………………………….…..Pages 32-33 Appendix F: Quotes………………………………………………………………………………………………………………………………………………………………………………………...Page 34 Bibliography…………………………………………………………………………………………………………………………………………………………………………………………………...Page 35

Table of Contents

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Background

Store History The first Art in the Alley store was opened by Tami and her hus-band Dan Edmunds on May 1st, 2008 in Superior’s historic old City Hall at Broadway and Hammond. The store’s name came from Dan’s pottery kiln set up outside the building by the alley. By taking spaces that weren’t retail and making them their own, they were able to transform the store into the unique experience that Art in the Alley is. Since then, they have opened five more stores and closed three, with the original store closing after they moved to downtown Duluth in 2012. The specific location at the Miller Hill Mall has only been open for approximately a year now, after two years of the mall manager trying to get Art in the Alley to rent out a space. Ultimately, Tami decided to open a store in the mall. De-spite the small size of only 1,200 square feet, she was able to ex-pand the target market and provide a year round shopping experi-ence for her customers, as the Duluth weather greatly impacts their downtown location.

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Store Location The store is located in the Miller Hill Mall in Duluth, MN. It is right on the “50 yard line” of the mall, meaning that it is near the main entrance and gets a lot of traffic. Stores surrounding Art in the Alley include Hallmark across the hall, T-Mobile and Younkers down to the right, and American Eagle to the left. Caribou Coffee is also near Art in the Alley creating a lot of traffic as people come and go with their coffee.

Storefront

When approaching Art in the Alley, the store really stands out compared to other stores in the mall. Most stores have white painted walls along with the storefront supplied by the mall. Art in the Alley makes itself more attractive compared to its surroundings by painting the walls vibrant, eye-popping colors, along with displaying its exciting products throughout the store. Since it is in the mall however, it’s difficult for the store to look different relating to the exterior of the store. There are cold gray tiles that outline the entrance. Tami does a great job of drawing customers in with the atmosphere consisting of bright colors and music playing throughout the store.

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Entrance Area and Store

Layout

Currently, when you walk into Art in the Alley, there is a front table with various buy one get one half off items and two clothing racks with one on each side of the open door entrance. One advantage that Art in the Alley has with their current entrance is its size. As Underhill states in chapter seventeen of Call of the Mall, large entrances are the most effective and the ideal store would be shallow and wide so the customer can see everything inside. Due to Art in the Alley’s size, large entrance, and glass win-dows, the consumer can see the entire store with ease. As customers enter the store, it is important for Art in the Alley to minimize the transition zone so customers are more aware of what they are looking at. The flow from the mall hallway into Art in the Alley currently is standard white tiles that blend right into the gray carpet of the store. If Art in the Alley followed Underhill’s advice as stat-ed in chapter three of his Why We Buy book, Art in the Al-ley could change the floor color or texture to help slow customers down and ensure they are noticing the store and everything it has to offer.

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Theme & Decor

Throughout the store there is a common theme described as “fun” by Tami. The bright blue, yellow, green, orange, and pink colors on the walls give off a fun and exciting vibe. All of the inspirational signs and pictures displayed throughout the store keep constant to the theme of being unique and having fun. A wide array of music is always playing, whether it’s a classic by Frank Sinatra or the latest pop hit, there really is a song and genre for everyone. Most prod-ucts are sorted by colors. Each rack of clothing is coordinated so there is a neutral color rack, a black and white rack, etc. All of the jewelry is located in one specific section. There is a table in the front with clothing racks and then the store proceeds with a low to high display that is easy on the eyes.

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Illustration of Store Layout

*Black boxes indicate clothing racks

**Black line indicates most traveled

path based on observations

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Positioning

In terms of how Art in the Alley is positioned, one of a kind “unique” and local products is the main focus they tend to emphasize. The owner, Tami, creates a lot of the products herself, meaning there will never be an identi-cal product like it anywhere else. Customers love this as-pect of Art in the Alley and it is one of the main reasons the primary target market tends to shop there over any other store. Another way Art in the Alley positions them-selves is on their upcycling. By incorporating these green practices, they are able to draw in the primary target market (Marsha) as well as the secondary target market (Gretchen). This also helps Art in the Alley maintain an edge on other competitors who do not upcycle. One of the most important ways that Art in the Alley is posi-tioned as is a fun atmosphere where everyone can feel the store’s love. Their tagline is “Wear what you LOVE, LOVE what you wear!”. Tami goes out of her way to en-sure that all customers in the store, whether they are the target market or not, have a good time. She enhances the store's atmosphere by including bright colors, music, and pictures appealing to both the target and secondary markets.

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Target Market When we asked Tami about her target market, she responded by saying the target market consists of people like her, meaning the target market mainly consists of middle aged women who are very interested in their own identity and individuality. Art in the Alley focuses on women between the ages of 35-65 as their primary and secondary markets. This also includes one of a kind people who don’t want to look like anyone else. It’s an attitude, not an age. They want to feel love, which is one of the attributes of Art in the Alley. As mentioned before, another differentiator is their upcycled products.

Primary Market: “Marsha” Marsha is a 45-65 year old female who shops at Art in the Alley to fulfill her upscale lifestyle, and expand her trendy closet. Marsha has just downsized her home and is now living in a nice condo in Duluth. She is the type of person who will hop on a plane and go to Vegas for the weekend with her girlfriends. Marsha usually spends her money on new, trendy, and quality items. She is proud of what she has accomplished in her life and realizes she deserves nice things. Her friends describe her as an energetic go getter who is always working in her garden, walking her dog, or golfing. Marsha uses Art in the Alley’s products to impress her friends and to show people the successful life she has accomplished. She is retired and after raising a wonderful family, she spends her time doing the things she wants to do. When it comes to clothing, Marsha dresses for comfort but also has to look good. She is concerned with the quality of fabric and knows a high quality item when she sees one. Because of her successful career, she was able to retire and still have plenty of disposable income. She supports local businesses and loves visiting the farmer's market and the Co-Op. Marsha is willing to spend the extra money to get a one of a kind product that is environmentally friendly. This is extremely important when thinking about the environmental trends occurring today. A lot of people this day and age are more concerned about where their products are coming from, so the fact that Art in the Alley supplies upcycled products really attracts shoppers like Marsha.

Secondary Market: “Gretchen” Gretchen is a 35-45 year old female. She has kids who are grown and now she is taking time for herself. She’s a giver, a college graduate, and a professional, so she has money to spend. She has traveled the world, recognizes fashion, respects hard work, sup-ports local businesses, and she wants something that’s one of a kind. Tami is familiar with “Gretchen” customers because that’s who Tami is. Gretchen shops at Art in the Alley to feel good. She recognizes the feeling and energy the store gives off, and feels that emotion translated into the products she buys. She sees herself as above average in terms of intelligence, income, fashion, being savvy, and knowing what “the good stuff” is (Art in the Alley has the good stuff). She steers away from stuff made in China and ap-preciates the hard work put into locally made items. Gretchen's friends describe her as carefree, easy going, smart, and well trav-eled. The most important things to Gretchen are her family, community, respect and simply being a good person. Gretchen’s style can be described as “Boho” with a mix of tech gear like The North Face, Under Armour, and Lululemon. Gretchen has less disposa-ble income than Marsha and is primarily focused on items that speak to her personality and possess quality materials.

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Competition In the mall, Francesca’s is Art in the Alley’s biggest competi-tor. People often think that Tami started the store because the concept is similar to Art in the Alley’s. Upon analyzing the competitive advantages that Art in the Alley has, a major ad-vantage is the one of a kind products that Art in the Alley sells. No one can ask a salesperson in Francesca’s about the art in there, because they wouldn’t know much about it. Tami on the other hand, knows about everything in Art in the Alley because she makes a lot of the products. The following quote proves this one of a kind advantage to be true, coming from a laddering-technique interview with a regular Art in the Alley customer. “That piece of clothing or jewelry you’re wearing become a lot more important. When I buy jewelry made from China, I don’t feel that at all. I have no emotional connection to that piece. With jewelry from Art in the Alley, I know that Tami made this piece, and there isn’t another one out there like it. To me, that is very special.” Another competitor for Art in the Alley is Apricot Lane that is a women’s clothing chain featuring modern trends in casual-wear and dressy fashions. Apricot Lane also sells women’s accessories.

Products Art in the Alley has numerous products for its consumers to pur-chase. Women’s clothing is a big category for Art in the Alley and has prominent sections throughout the store. These op-tions include: skirts, tops, jackets, scarves, leggings, and acces-sories like jewelry and socks. Tami makes many of the one of a kind items such as the jackets, jewelry, paintings, as well as oth-er art pieces. Along with this, there are a lot of small knick-knacks for customers to purchase scattered throughout the store, driving up impulse buys.

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Methods Our strategy for observing Art in the Alley was to have at least one person there each day for a week so that we could see different patterns for every day of the week (refer to table 1). Aside from that, we had each group member observe ten hours in total at various times, again so that we could monitor the different customers and purchasing patterns. We observed for a few hours at a time to see how people interacted with Art in the Alley. As a group, we totaled 40 hours all together. Thinking about what we wanted to accomplish by observing, as a group we decided on three main topics: purchase patterns, store experi-ence, and merchandising. Another side topic that we thought would be beneficial to observe would be whether or not consumers were shopping by themselves or with others (influence of a second party). We thought these would be the best areas to cover because we already had some possible recommendations in the making regarding these topics as well as the fact that they would provide good consumer in-sights. From this, we were able to develop multiple questions within these three main categories to get a deeper understanding of these in-sights for the store. A list of 22 total questions assisted us with our observations (see Appendix C). To get a viewpoint and go deeper into our customer’s heads, we interviewed some of them using a few different techniques like laddering and their decision making process. This helped us to determine their values and gave us an exact profile for them in order to see how Art in the Alley satisfied the needs they had (see Appendix D). After about a week of observations, as a group we began to notice that similar patterns were occurring each of the times we observed the store. These included mostly qualitative data such as how customers were navigating throughout the store and what they looked at. To en-sure quantitative data was collected to help enhance our justification of our recommendations, we made sure to record customer de-mographics, how long they stayed in the store, how long they stayed at a particular section of the store, and how many people they were shopping with (see Appendix E).

Table 1: Example Weekly Observation Schedule

Sunday Monday Tuesday Wednesday Thursday Friday Saturday

Liz 1-4 Liz 11-2 Adam & Alex 5-7

Allison 12-3 Allison 2-4 Alex 4-6 Adam 3-5

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Observations Time Spent in Store

One of the biggest trends that developed throughout our observations was the influence of others when consumers shopped in groups, es-pecially when the group consisted of a husband and wife. Tami was right when she said men affect women and their shopping behavior when couples come into the store. Based on our observations when a woman comes into the store alone, she usually spends a few more minutes than she would if she shops with a man (less than a minute with a man). See the store map on page 7 for details of where consumers walked and spent the majority of their time. The left side of the store saw more interaction than the right side of the store with many people making a loop starting on the left side and then weaving through the middle of the store and back out through the entrance. The majority of the customers casually walk in, clearly not in a hurry, look around for a few minutes, and then proceed to leave without a purchase. The clothing racks, tops, necklaces and most popular the scarves are looked at and felt by the customers. People tend to glance at and read the various signs located around the store as well. Consumers seem to be curious and do not have a certain purchase in mind when they enter the store. Based on this observation, Tami’s customers are curious about the store and seem to make impulse purchases. This curiosity provides Art in the Alley with an opportunity to influence the consumer and what they purchase. Art in the Alley isn’t known for a single item such as a customer walking into a shoe store, for their products are handmade and one of a kind, resulting in a new assort-ment of products each time the consumer shops at the store.

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Observations Time Spent in Store (continued)

Scarves and sweaters were the two most popular items that customers looked at while browsing the store. The observed shoppers fit our tar-get market with the majority of the women being 45-65 years old. On average a customer spent 5-10 minutes in the store. During observation hours sometimes employees would stay back by the cash register with little to no interaction with the groups of custom-ers. Although there is definitely a wrong way of approaching groups of customers by making them turn away and leave or even change what the customers are doing, there must be an approach that could benefit Art in the Alley.

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Observations Sales Interactions

Based on our observations, next to no customers ask questions. If a sales interaction occurs, it is started by the sales associate of Art in the Alley asking how the customer is doing. The interception rate varies on whether or not a customer enters with a group of 2 or more. If there is more than one person involved in the shopping experience, the sales associate tends not to interact, in hopes that the group will sell themselves on the items. We estimate the interception rate to be 60% based on the observations above. Every customer that enters the store however is a potential buyer. Some customers vary on this, saying that they are “just looking” when the sales associate asks if they need help finding anything. Other buyers know exactly what they are looking for, have Tami to help them pick out something she knows they would like, or end up finding something even though they weren’t planning on buying. Because of this, we have estimated the conversion rate to be 10-25%. Wait time experienced by customers is relatively low, if any. Our observations showed that we never saw someone having to stand in line, which as Paco Underhill says, serve a customer in under two minutes for it to be considered a success (Underhill, 2009).

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Observations Attention Grabbers

Art in the Alley certainly offers a different and unique experience for customers as soon as they enter the store. As soon as a customer enters the store, not every one of them follows the same pattern. They all tend to look around, in every direction, at everything Art in the Alley has to offer. The bright colors painted on the walls pop out of the cold gray tiles surrounding the entrance and draw customers into the store. While they are inside, they find other things that entice their emotions and grab their attention. One that we noted to be extremely effective was the wall of the signs located on the left side of the store. With different motivational and inspirational sayings, consumers almost always stopped to look and examine this wall. Another thing that we saw grab consumers attention was the jewelry located directly next to the cash register. While customers were waiting to have their purchases rung up by the sales associate, they would grab the jewelry and examine it. These items were strategically placed in the time to kill area, and therefore the customers noticed them.

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Observations Signage

Consumers walking in the mall from the right side of Art in the Alley immedi-ately come across the sewing machine Tami has placed in the front window where she actually makes some of her one of a kind products for people to watch. This is very effective at drawing customers in and creating a certain cu-riosity in their minds. Directly on top of this display is a sign saying “Thank you for shopping with us, we are a local small business!”. This sign directly appeals to the hedonic emotions of the primary target market, who supports and stays true to her local brands. Also located in this window, are some products that are available to purchase within the store. This causes this window to look and feel cluttered, almost giving consumers too much to look at. In the window on the other side of the store, is a similar scenario, filled with products from the store creating a cluttered window display. Consumers aren’t sure of what to look at because it is so busy and ultimately keep walking past the store. If customers are seeking signage or something for their information needs, there isn’t much information given about the product sold, except for the sign about the local business in the front window. There is a lot for customers to actually look at while they are inside the store, so they tend to get over-whelmed, thus leading to a shorter shopping stay.

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Observations Store Atmosphere

The store atmosphere and experience is absolutely consistent with the fun and unique vibe that Art in the Alley positions themselves as. This is further backed up by the consumers who came in the store specifically just for that experience. This customer experience begins even be-fore they enter the store. Consumers are able to watch Tami sew one of a kind products for the store through the window, without physically being in the store. The large glass windows on the side of the store and the large open entrance allows customers to see into the store and most of the products inside. This makes the content in these large display windows crucial, since customers can judge the store by just these two windows in deciding whether to enter or not. There are two racks located in the entrance of the store opening that do a great job luring in potential customers. Based on our observations, about half of the time customers made the decision to enter the store based on the two racks. They would walk by the store, see the racks, and begin to examine then. If they liked what they saw, they would proceed the shopping experience further into the store. If they were uninterested with the clothing on these racks, they continued on through the mall without en-tering Art in the Alley. Again, it is crucial that the products on these racks are strategically placed, since more than half of customers decide to enter the store based on what is hanging on the racks. The following quote from a laddering technique interview with an Art in the Alley cus-tomer justifies how the target market seeks out and enjoys the atmosphere of Art in the Alley. “When you walk into the store, the bright colors and fun music make it almost impossible to be in a bad mood. There is bright colored cloth-ing and accessories and the home decor posters or pictures are filled with inspirational quotes and phrases that put a smile on your face.”

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Observations Merchandising

Art in the Alley offers an expansive selection of items for purchase. Before a customer even enters the store, they are greeted by two racks of various clothing articles ranging from sweaters, shirts, jack-ets, etc. Then, within a few feet of walking into the store, there is a Buy One Get One table near dead center of the floor. On it are vari-ous signs, scarves, and other small items. To the right of the rack there is two more square and a single circular clothing rack with more various articles of clothing. Moving towards the window, there is one more square clothing rack positioned in the corner, with a table of hats located in front of the window Moving back to the rear of the store, the back wall is covered with signs and jewelry pieces for sale. The art ranges in price, while the jewelry tends to be much lower priced. The register has a table on either side, with the left one holding Tami and other artists hand-made jewelry pieces, and the right table having many pairs of brightly colored socks. Behind the BOGO table is a table with small knick knacks like a reconditioned typewriter, old toys, and other various household items that have been repurposed or restored. Located in the back-left corner is the dressing room. Moving along this wall, there are racks of shirts and necklaces followed by more in-spirational signs. There are two more, smaller clothing racks located over here, and also another table of knick knacks and scarves in front of the left-side window.

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Recommendations Recommendation #1—”Draw Customers In”

Current Situation

Currently, many customers walk past the storefront and either give it a quick glance, or flip through the clothing racks located at the en-trance. Without drawing customers into the store, the likelihood of them making a purchase is slim.

Justification

Consider either moving the racks at the entrance of the store inside, or minimize the product on the racks. This way, potential customers get a taste of what the store holds, but do not decide whether the product suits them or not before entering. Another option would be to position an employee standing near the entrance, greeting potential customers as they pass the store entrance, intriguing them even more.

Recommendation

As noted above, it was noticed through observations that many customers either stopped at the store entrance racks for a minute or two, or only gave the store an intrigued glance while passing. Drawing customers inside the store is the first step to them making a final pur-chase. As noted by Paco Underhill in Why We Buy, a good transition zone into a store is the first step to a purchase. By having only a few items at the entrance, or greeting customers in, their interest will only be expanded, drawing them inside. In Underhill’s Call of the Mall, he also says that stores that are located near an entrance of the mall often struggle. Art in the Alley is right in this area where most things are not consciously registered by customers. With this in might, Art in the Alley must find a way to create this conscious awareness. By removing the racks of clothing outside the store and instead having an employee standing near the entrance engaging customers, individuals are actively engaged with, drawing curiosity to what is inside the store.

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Recommendations Recommendation #2—”Keeping Customers In”

Current Situation

While observing, it was seen when a customer does enter the store, they often make a quick lap through, then leave. The longer a cus-tomer is inside, the more likely a customer is to make a purchase.

Justification

While there are many good aspects already in use at Art in the Alley, such as the music and friendliness of all the employees, there are other ways to keep customers in the store longer. Using scent diffusers with cinnamon, lavender, and other floral scents raises the time customers spend in the store, raising their likeliness to make a purchase.

Recommendation

As stated above, it was observed that prospective customers often times would make a quick lap through the store, pick up a few things here and there, and then leave. The potential of a purchase being made decreases greatly as the time spent in a store also decreases. As discussed in our CB Insight, “Smell of Success”, these scents are scientifically proven to be soothing, calming, and increase time spent in malls and stores. As a recent trend, many retail stores are beginning to use scents to instigate purchases. Abercrombie & Fitch CEO Mike Jeffries says their scent used in stores generates approximately $80 million for the company. By utilizing this knowledge, in con-junction with the already present ambience of the store (music, colors, etc.) time spent by a customer can be increased and thus raise the potential of a purchase occurring, ultimately raining revenues for Art in the Alley.

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Recommendations Recommendation #3—”Watch the Butt!”

Current Situation

While space may be limited, it was observed that the current store layout leads to very tight walking space, sometimes causing customers to brush up against each other when trying to pass by. Also, this leaves little to no room to push a stroller through the store. Being as this is a mall location, strollers are very common, especially with the targeted demographic of Art in the Alley.

Justification

We recommend the store layout be redesigned as to open walking space for customers, particularly to avoid individuals brushing against each other when attempting to pass by, or mothers with strollers. This can be achieved in multiple ways such as utilizing the wall space more efficiently through shelving units or installing chevron style shelf stands rather than racks on the floor.

Recommendation

As observed, many people walking through the store were seen to have issues passing each other between racks. This causes discomfort for shoppers, and lowers the odds that people will spend more time in the store and results in a lower likelihood of purchase. Secondly, it was seen during observation that mothers with strollers rarely entered the store as they would notice that there was not enough space to push their child between clothing racks.

In Paco Underhill’s Why We Buy, there is a chapter about something he has dubbed as the “butt-brush effect”. This effect is known to make customers uncomfortable and spend less time shopping. The phenomenon is known to affect women more explicitly than men, which is in-credibly important as Art in the Alley targets women specifically. By creating a different structure to the store’s clothing racks and better uti-lizing wall-space, this effect can be minimized and allow customers to have a more comfortable shopping experience, thus increasing likeli-hood of purchasing.

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Recommendations Recommendation #4—”What about me, honey?”

Current Situation

As noted before, Art in the Alley is positioned toward middle-aged to older females. Generally, these individuals have husbands who are shopping with them. With little to no products for men, what is the husband to do while his wife shops? Often, the husband becomes im-patient, ultimately shortening the time the wife spends in the store.

Justification

There are two potential solutions to the above situation. The first would be to introduce products for the husbands, even as simple as small knick knacks that he can look at while the wife shops. The second option is slightly more involved; Asking mall management to pur-chase a bench or two to place outside the store. This way, if there are no stores in the area the husband would like to look at, he can sit and wait outside while his wife shops.

Recommendation

While observing, we saw a trend of couples entering the store and the husband quickly becoming impatient or bored. This boredom would lead to agitation of the wife, usually ending with both leaving without a purchase being made. It is said in Underhill’s Why We Buy that men and women “shop” quite differently. This is readily observed by the above example. While the wife shops, the man becomes impatient as there is nothing that interests him in the store. In the end, this drives both out in a shorter time than the wife may have spent, had she been without the pressure of her husband.

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Recommendations Recommendation #5—”Windows Sell”

Current Situation

Currently, the window fronts of Art in the Alley feature many products that are not often changed and fill nearly the entire window.

Justification

We recommend Art in the Alley reduce the amount of items in window to allow customers to look into the store while passing. Secondly, we recommend Art in the Alley rotate the items in the window on some sort of regular schedule (ex. Weekly, monthly, etc.). Also, consider labeling these items as the “Item of the Week” for example.

Recommendation

While passing by Art in the Alley, it is difficult to see into the store through the windows until you have completely walked past the en-trance. This leads to a loss of interest in what is inside before potential customers ever reach the door. Without a curiosity of what is in-side, there will be little foot traffic into the store. In the CB insight, “Window Dressing”, there are many techniques touched upon. Having solid use of windows in high traffic areas is incredi-bly important for generating customer traffic within a store. Using appropriate props and items is key. For Art in the Alley, displaying only a few items as the “Items of the Week” will peak potential customer’s interest, while also allowing them to see inside the store and further-ing curiosity. Also, using the current props in the windows (sewing machine with “locally made” sign) conveys the message Art in the Alley desires.

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Recommendations Recommendation #6—”Shopping Bags”

Current Situation

Art in the Alley regularly features small jewelry and trinkets which can be difficult for customers to hold and look at, especially if they plan on purchasing multiple items.

Justification

We recommend Tami use small baskets or bags to offer customers who have multiple items. If Tami wants, these simple bags could be crafted or upcycled by her personally, to continue the handmade feel of the store. We recommend the bags or baskets be dainty and not feel too large or bulky.

Recommendation

While observing, it was noticed many customers are unable to pick up any of the small products as their hands were already full with bags from other stores or other items from Art in the Alley. This leads to a loss of sales on smaller products like necklaces and other jewelry or accessories. These are some of the highest yield items, and their sales are essential to making a profit. In Paco Underhill’s book, he mentions how important it is to allow customers to keep their hands free while they shop. This allows custom-ers to stay in the store longer, look at more items, and ultimately purchase more. When a customer's hands are full, that usually indicates they should stop shopping. Even if they would like to continue, their hands are not available to pick up more items. A shoppers sense of touch is extremely important when making purchasing decisions, especially in a store featuring primarily clothing and jewelry. We believe a small basket is perfect because it will not be a burden for customers to carry around and with floor space already limited, carts or big bas-kets aren't practical. Big plastic baskets may also feel tacky or cheap in a store known for quality, handmade products.

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Appendix Appendix A—Interview Questions

1. What is the history of the store? 2. What is the difference (if any) between the Superior Street location and the Miller Hill Mall location? 3. What caused the move/addition of the Miller Hill Mall location? 4. Describe the types of products you sell. 5. Who is your current/desired target market? 6. Do consumers shop in groups? 7. What needs/beliefs/values are consumers seeking? 8. Which segment is most profitable? 9. Which store location is more profitable? 10. Who are your competitors? What is your competitive advantage? 11. What are your profit (margins) on various sections of the store or product categories? 12. Tell us about your store layout, merchandising, signage, perceived intercept rate, perceived conversion rate. 13. How did you decide where to place signs and merchandise 14. Do you think the placement of signs and merchandise helps convince people to buy? 15. Do you think your store layout entices people to come into your store? 16. What strategy did you use/have in mind when designing the layout of the store? 17. How do you do your employee training? 18. If you could change one thing about the store what would it be? 19. If you could only have 2 out of the 3 of the following what would you choose? The options are High quality, good/low price, and good

service. Why do you choose those? 20. What is Art in the Alley’s “Why?” In other words why do you do it? 21. How would you describe your brand Art in the Alley? 22. What do you want your customers to feel as they enter the store?

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Appendix Appendix B—Observation Schedule

Observer Date Time

Liz March 27th 12:00-4:00

Allison March 29th 3:30-6:00

Allison March 30th 12:30-3:00

Adam April 1st 3:00-7:00

Alex April 2nd 2:00-6:00

Liz April 3rd 1:00-4:00

Liz April 4th 11:00-2:00

Adam & Alex April 5th 5:00-7:00

Allison April 6th 12:00-3:00

Allison April 7th 3:00-5:00

Alex April 8th 4:00-6:00

Adam April 9th 1:00-5:00

Alex April 10th 11:30-3:30

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Appendix Appendix C—Observation Questions

Purchase Patterns 1. How much time is the customer spending in the store? 2. Is the customer falling into the target market that was defined? 3. What are they looking at while moving throughout the store? Where is there eye-level? 4. Where in the store are they moving slower? Where do they move faster? 5. How are they interacting with the sales associate? Store Experience 1. Which direction do they go as they enter the store? 2. Where does the customer experience start? Before the enter the store? 3. Is there relevant signage for the customer to look at? Is it cluttered? 4. What is the first thing the customer sees as they enter the store? 5. What can customers do right as they enter the store? 6. Is the store experience consistent with the product image? Merchandising 1. What do you see fifty feet away from your store? 2. Is anything in the “decompression zone”? Do customers attend to anything in that zone? 3. What can you place as a “power display” to slow consumers down after they acclimatize? 4. Where do customers look to in the store? Shopping in Groups 1. How many people enter the store together? 2. Are they distracted by each other? Talking to each other? 3. Do they all interact with the sales associate? 4. How does the extra party influence the customer? 5. What is the relationship between the customers? Is it a husband and wife? 6. Are both parties interested in the shopping experience? Is one more interested? 7. How long do they stay in the store together? Do they split up? Customer Profile: Laddering interviews and the decision making process

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Appendix Appendix D—Interviews

Laddering

Person 1: Lori, female, age 30. Loves color and loves to have fun; knows Tami, the owner, and supports her local business. Frequent shop-

per, knows the store.

Why did you come into Art in the Alley today?

I came into the store to see Tami.

Why did you want to see Tami?

She is such a friendly person to be around. She helps me shop when I’m in the store. She makes me feel good and laugh. We always have

fun.

How does she help you shop?

She knows what I like and what new products to show me that she knows I haven’t seen yet. She’s not a pushy sales person and is more

interested in talking to me as an individual rather than a customer. She makes you feel like you’ve known her for years even if you’ve just

met.

How do you think Tami does that?

You can tell Tami does this because she has a passion for it. She’s not trying to talk to you just for the purpose of making a sale. She likes

to make connections with people and make them feel comfortable. Plus, it’s very cool to know the person who made the bracelet you’re

wearing. You feel like what you’re wearing is so much more personal.

Can you explain why knowing the person who made something you’re wearing is important to you?

I think it just makes me feel special. That piece of clothing or jewelry you’re wearing becomes a lot more important. When I buy jewelry

made from China, I don’t feel that at all. I have no emotional connection to that piece. With jewelry from Art in the Alley, I know Tami

made this piece, and there isn’t another one out there like it. To me, that is very special.

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Appendix Appendix D—Interviews

Laddering

Person 2: Megan, female, age 41. New customer, never been to Art in the Alley before, from out of town. Looked around, intrigued by

Tami and the whole store.

Why did you come into Art in the Alley today?

The color of the store really drew me in.

Why did the color of the store draw you in?

It looked really friendly and inviting. Very colorful and warming. It looks like a fun place to be.

Can you explain what you mean by a fun place to be?

When you walk into the store, the bright colors and fun music make it almost impossible to in a bad mood. There is bright colored cloth-

ing and accessories and the home decor posters or pictures are filled with inspirational quotes and phrases that put a smile on your face.

It also makes me happy that a lot of the merchandise here is upcycled.

Why does it make you happy to see upcycled products?

I am an avid recycler and try to limit the amount of waste I put out, so seeing a local business do the same is very cool. I think there is al-

ready more than enough “stuff” in the world, so seeing a new light shed on older products is something I look for. I’m all for giving a used

product a new life.

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Appendix Appendix D—Interviews

Laddering Person 3: Tracy, female, age 34. Never been to Art in the Alley before, heard about it through word of mouth. Shopped around for a while, very interested in their clothing. Why did you come into Art in the Alley today? I heard it was a really unique store and had really cute stuff. Why did that make you want to come in? I want to have cute and one of a kind stuff! Why do you want those kinds of things? Because no one else has them and that makes me feel special and unique, setting me apart from everyone else. Can you explain to me how it sets you apart from everyone else? Well, most women I know shop at the franchise stores for their clothes, like Target or Yonkers. They all end up having the same clothes and ultimately look the same. I like to dress in clothes that are different, and no one else has. That’s what makes me feel special, the fact that people can notice me in a top because they have never seen it before, not because they have the same one.

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Appendix Appendix D—Interviews

Decision Making Process Name: Lori Need Recognition: Birthday gifts, needed something for a gift. Art in the Alley is a unique store so it interested her. Information Search: Saw the colors of the store, not knowing much about it, but they drew her in. She had never seen a store like it be-fore. Word of mouth reached Lori and she decided she wanted to check it out. Alternative Evaluation: Target, and stores in the Twin Cities such as Nordstrom's is usually where she shops. Location and proximity to her home was a determining factor on choosing which business to purchase from. She likes the idea of supporting a local business. Purchase: Need realization and the physical feeling of the item (soft and smooth), fashion sense, color. Low involvement - no risk involved in purchasing mittens. Post-purchase: Very good! Mittens were great, her daughter loved them. Lori liked them so much she bought a second pair for herself.

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Appendix Appendix E—Observation Records

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Appendix Appendix E—Observation Records

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Appendix Appendix F—Quotes*

“Unique items - Affordable Prices” “Art in the Alley is a great place to shop! They have a large variety of unique items you can't get any-where else. They have wonderful employees who are always willing to help.” “Art in the Alley Duluth, MN” “Art in the Alley is an awesome place to shop, always great unique stuff & super prices! The customer ser-vice is amazing!!” “Adorable! ” “Super fun items all the way from jewelry, scarves, and artwork to one of a kind pieces. Tami is wonderful as well as her em-ployees. If you like fun, color and whimsy, this is your place!” “Creative Boutique” “Art in the Alley is so cool! It's filled with fun things to buy. Everything is so colorful and happy there. Worth the vis-it just for the positive vibes.” “Something for everyone!” “This store is so fun, they really have something for everyone and have things at all price points. The staff are super friendly.” “Art in the Alley makes me happy!!” “I love to go in this delightful boutique whenever I am in Duluth to see what new surprises Tami, the owner, has found - or made - to please her customers!” “Inspirational” “I recently bought gift items for my nieces, which were fabulous, but shopping at Art in the Alley is simply good for the soul.” “Love this place” “Art in the Alley is one of my favorite places to go for gifts or retail therapy for myself. The items in this store are unique and well made.“

*All quotes found on Tripadvisor.com

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Bibliography

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