What does a rise in Macy’s profits of 3.8 percent in the last quarter mean to other retailers? It means this is no time to be asleep at the wheel.

JC Penney and Kohl’s are being mentioned as losers in most of the financial news stories. Can’t argue with that.

But what about Sears, Stein Mart, Dillard’s, Belk, Target, Walmart and even Kmart?

If you want to grow business as a retail store, you need to do it at the expense of your competition. I think we all agree with that. But where is the sense of urgency and the absolute need for change in this category? I don’t see it anywhere.

The analysts assert that advancements in delivering online orders are mostly responsible for the good results for Macy’s. To my thinking, this is a thin and fleeting advantage.

As an expert in increasing market share, I can tell you straight out — there is room to take a lot of share in this category. All you need to do is get out of your own way and be willing to reinvent your importance to the shopping market. We know how to do this and yet no one from the category has called us to ask us how. Whoever calls first will win.

Tough times continue for Best Buy. The latest news is that the company’s cash-flow expectations were lowered because payments on inventory had to be made earlier than expected.

This was not Best Buy’s fault. It received inventory sooner than expected and had to pay for it sooner too. But this perpetrates the negativity surrounding the Best Buy brand.

The overarching problem with Best Buy is that nothing has been done to stabilize its brand. On top of that, the company refuses to adapt to the changing competitive landscape – which brought down Circuit City – and is fending off takeover bids from founder Richard Shulze.

The Best Buy brand extends only as far as one of its blue-shirted employees can take it. Online retailers have been devouring Best Buy’s market share. That cannot be attributed only to the overall woes of brick-and-mortar stores. Apple outlets, by contrast, are packed with customers.

The responsibility of any company with brick and mortar is to create enough of a brand that it becomes a destination. Best Buy should reexamine the experience its brand creates and figure out why it is no longer meaningful to its customers.

Why does the Best Buy customer use Best Buy? Why do others reject it? Who does the Best Buy customer believe they are? How does Best Buy reflect that? Is the Best Buy customer seeing Best Buy as easily interchangeable with other stores like Target or Walmart and what is driving those feelings?

These are important questions. The fact that little has changed at troubled Best Buy indicates that the critical questions are neither being asked nor answered.

Best Buy’s future is gloomy, unless it examines its brand closely.

As we have been speculating at Stealing Share, Barnes & Noble is in dire need of extensive rebranding if it wishes to stay afloat.

Recently, rumors have surfaced that the Nook, Barnes & Noble’s e-reader, may spin off as an entirely separate business entity. Maybe this is Barnes & Noble’s realization that if it does not rebrand now, it is destined to become the next Borders.

In other words, go belly up.

Let it be known, I still love the good, ole’ fashioned bookstore. But the fact is, bookstores are slipping away as fast as CD stores once did. Media retailers must learn from this and act accordingly. In the music business, MP3s, MySpace and the iPod revolutionized the way we listen to music. Each completely altered the marketplace from a tangible medium to the near entirely digital marketplace today. Presently, wasting time on any physical media business (such as book, video and CD stores) is as wise a move as investing in Netflix. Ask Blockbuster or Hollywood Video how badly people want to rent physical DVDs. Or Turtle Music and Borders what a wide-ranging selection of CD’s can do for you.

The fact is, we want what we want instantly. And the digital world provides us with this capability.

Books are clearly heading in the same direction as CDs. In fact, e-reader and other digital content sales for the Nook were up 43% this holiday season, while physical sales for Barnes and Noble increased only 2.5%. That’s a pretty significant difference.

This brings us back to our initial topic. It is also why I believe whole-heartedly that having the Nook as a separate business is a massively wise move for Barnes & Noble because it separates its brand from that of the brick and mortar one of B&N.

Barnes & Noble should not waste any time with this rebranding effort. It has a sleek and interesting product in the Nook. What’s more, it has grabbed hold of 30% of the e-book market already. This is reason for it to celebrate, but not to remain complacent. Embracing this change is just what Barnes & Noble needs and it is smart to realize that this change must happen.

In this day and age of hyper-segmentation, with broadcasters and media providers developing programming for a specific audience (i.e., those they deem they can market to), there is still a single bastion of commonality that brings consumer segments spanning the gambit together for no less that 4 hours – the Super Bowl.

Some companies spend nearly their entire annual advertising budget on a 30-second ad, hoping it will be the subject of “Super Bowl top 10 commercial” lists or get the all important social media title of “viral.” For advertisers, the Super Bowl has become more than a football championship. It’s become the championship of advertisers and their agencies.

Analysts, bloggers, newscasters, and everyone in between will spend the weeks and months before and after the Super Bowl dissecting the ads, saying which one they believe were the most entertaining, provocative, and funny. There is often a hush at Super Bowl parties at the first commercial break with viewers expecting to see a commercial that will blow their minds. For many, the ads have become as important as the game itself.

This year’s Super Bowl will change everything. For the first time, the Super Bowl will be streamed on the Internet. Viewers will have unprecedented control over camera angles and replays.  Computers, hand-held devices, and Internet-capable TVs will be tuned in to the game like never before, giving users of these devices a novel way to see an event they have come to love.

This is exactly why streaming the Super Bowl heralds in a new era of media.

First, viewers who are seeing the game streamed on the Internet now have the ability to easily navigate away from the torrent of advertising that accompanies the game. Not to say that those who have no interest in the ads previously did not get up to go to the bathroom, get another beer, or refill their plate of food. But watching it on a phone or computer, it is much easier to open a new tab or check email during the ad breaks.

Secondly, and more importantly, streaming the game is a signal that the NFL understands that the world is changing and that perhaps it will eventually not need traditional over-the-wire or cable broadcast to get their product out to the masses. Though the game will still, and probably always, be on a major over-the-air network, the shift in strategy by the NFL is a signal to viewers and advertisers alike that the world of programming transmission is changing, forever.

For advertisers, bringing the Super Bowl online means viewers will have the immediate ability to interact with a message, including choosing what messages to view, interact with or avoid.  For the viewer, it means more control over the content and, equally important, a reminder that they do not need a cable subscription to get content. Although the Super Bowl will continue to be broadcast, cable companies should be very concerned about a program with this much impact being broadcast over a different venue than their own.

For local cable providers as well as local major network affiliates, the time allotted to local advertising ceases to exist when the Super Bowl is streamed. Though they are not getting the obscene money the national broadcasters are getting, they were getting a sizable amount of revenue for their local ads. It does not seem so far fetched to think that one day the NFL may just decide to stream the Super Bowl ONLY and profit from the entire program, including the ad revenue that is now being collected by the network. Clearly, it sees the possibility.

The writing on the wall has been there for a couple of years. The Internet allows viewers to control the content when and where to see it, and eliminate the carrier. Rather, they are going directly to the content producer and will be doing so more and more as all forms of media displays, TVs, phones, and computers are designed to do one thing: deliver content regardless of its source.  The old saying “content is king” is absolutely true in this age of the Internet and it is the content creators who stand the most to benefit from the demise of traditional media.

I have yet to find a company that has succeeded by taking what has already failed at and made it worse in order to achieve improvements. However, USPS looks it will give it a whirl.

The USPS is in a bad spot financially. Trying to regain viability while down economically is a big hurdle to overcome and often causes cautious actions when bold, profound ones are needed. The finances of the postal service have made it resort to number-crunching rather than looking at how it can best create preference in the market. Number-crunching leads to arbitrary decision making, like the removal of Saturday delivery or an increase in price of first class mail (while at the same time extending its delivery time by an additional day) without a clear understanding of what the removal means long-term.

This is not to say that some things don’t need changing or even scrapping altogether. But the lack of any visible brand message leads me to believe that these strategic decisions are not being made to better align the USPS’s operational actions with a new, more clearly defined brand. The changes instead seem like the product of a spreadsheet that lists what services must be axed based on the greatest dollar value achieved while maintaining the least possible resistance. It all adds up to a strategy that buys time, but loses in the end.

The USPS ran a recent campaign touting priority mail and its “flat rate”, pitching the flat rate as reducing hassles in operating a business. The biggest folly of the campaign was part in parcel to the fact that, when the USPS ads mention competitors like FedEx, it used a generic envelope that said “fast” on it. The proposition for the consumer was “fast” versus “flat rate.” The problem with this strategy is that FedEx’s brand is not “fast,” the brand of FedEx is “piece of mind.” FedEx has been successful because its brand represents an emotional context not a procedural one. Real equity is at the highest emotional intensity, and “flat rate” is about procedure not emotion.

With whatever budget it has left, the USPS needs to look closely at the market and find where the value for consumers exists. Only then should they evaluate what should stay, what should change and what should go altogether.

The beauty of brand, and something we stress when talking to companies full of internal politics and silos, is that it not only provides meaning externally to your consumers but it also provides internal guidance as well. It lets you know “strategically” what is the right move for a company, what plans for growth are the right ones, even what acquisitions are the correct ones. Without the guided focus of a “brand,” the USPS will continue to flounder in the dark, cutting what might not need to be cut and basing decisions on a best guess and a bottom line rather then on an understanding of why customers choose or, in this case, have not chosen.

Well, that was certainty interesting. Netflix CEO Reed Hastings announced today that Qwikster, the proposed DVD-delivery offshoot of Netflix, is no longer.

In a statement emailed to subscribers, Hastings begins with: “It is clear that for many of our members two websites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVDs.”

As a subscriber, I’m happy with this, which I hope is the final result. I like to do both (stream, rent) and I was confused over how the process would work once Qwikster was live.

There are a few lessons to be learned from this, however. For one thing, Hastings and Netflix have finally understood that simple is always best. The reason for the power of simplicity is because complexity adds barriers to use and adoption. It’s the reason why, for example, some of the most used websites, such as Facebook, are simple and easy to use – and why Facebook users got angry when Facebook overcomplicated matters.

The other lesson is that Netflix is struggling to maintain its market leadership because its brand has been based strictly on a process, rather than an emotional connection. So, when the process got confusing, the brand got rejected.

The market in which Netflix competes is becoming more and more competitive as competitors copy Netflix’s process. Blockbuster, once dead, will be resurrected by DirecTV in a model that copies Netflix. Rumors are also growing that this is an area in which Apple wants to gain a stronger foothold and may also copy Netflix’s process through Apple TV to do it.

Netflix triggered this Netflix/Qwikster model after customers complained of price hikes. Netflix failed to see that it could offer separate plans under one brand and one website until now. (Though, the brand guy in me was very interested in what Qwikster was going to look like.)

Give it up to Netflix for realizing its mistake and landing where it should. Now, it needs to take the next step in becoming emotionally important to customers so that, when mistakes are made, they are forgotten or forgiven, and any equity it has lost during this latest fiasco can be overcome.

A letter sent Sunday evening by Netflix’s CEO Reed Hastings begins with an apology, followed by an explanation of the future of Netflix. Or should I say, the future of Netflix and the beginning of Qwikster.

The current shape of Netflix and its future uncertainty is in fact a case study in what happens if companies only focus on the business of their business, and never develop the business of their brand.

In the letter, Hastings writes, “So we realized that streaming and DVD by mail are really becoming two different businesses, with very different cost structures, that need to be marketed differently, and we need to let each grow and operate independently.”

The idea that the two services exist in a realm so separate from one another that they warrant two separate companies is only reinforced because Netflix has never told us what its brand represents and who as consumers we were when we chose Netflix.

The focus of Netflix has always focused to heavily on its process. Its business is streaming movies and sending DVDs by mail. But its brand could have represented, and could still represent, much more than that. The power of brand is that brand creates the deeper level by which products and services become connected. Netflix DVD and Netflix streaming did not work together because Netflix never told us the “why.”

Take Apple, for example, and its long-running “Think Different” campaign. It was not about a technology. It was about its brand. Apple even changed its name to Apple Inc from Apple Computers to avoid limiting itself by the the products it could sell. Why be limited in the products you can offer if brand permissions can allow for so much more? Netflix has never recognized this and it is why, if you ask someone what the brand of Netflix represents, the response is rarely more than “movies” or “DVDs.” If you represent “movies” or “DVDs” than you have diminished your value to the consumer to the likes of Vudu, Hulu, Amazon, Crackle, Redbox or any other distributor of “movies” and “DVDs”.

The recent split by Netflix is not the solution to the problem. In fact, if past performance dictates future results, all Netflix has accomplished is creating more market confusion and hurdles for preference with two companies lacking brand instead of one.

I always liked Netlfix, primarily for its streaming. But, like most first movers of a technology, if value is created simply because of that technology, then the value is lost when the competition arrives.

Again, I reference Apple and its iPad. Value for the iPad was built through the Apple brand. It is why tablet sales outside of the iPad have been failures in comparison and why if you buy a tablet you either buy an “iPad” or a “tablet”.

Hastings’s letter closes, “Both the Qwikster and Netflix teams will work hard to regain your trust. We know it will not be overnight. Actions speak louder than words. But words help people to understand actions.”  

The fastest way to gain that trust is talking about what is emotionally intensive to consumers. For anything Netflix says to be resonate, it means it has to be said by the brand itself.

For a minute there, Google+ felt like it was going to be really, really important. That it was going to be the game changer in the Social Networking world. Didn’t it?

It had all the momentum.

Nearly all of my technologically savvy friends were posting the warning signs on their Facebook wall, proclaiming that Facebook better beware because Google+ was much better. It started to feel like it this could be the death of Facebook.

So I beg the question, where did Google+ go? And why does it feel like it left us so quickly?

Here’s what I think the problem is.

Google+ hit the marketplace pushing its beta platform. Doing this meant that it was still ironing out all of the various kinks — in other words, making sure it had all of it’s components right. In doing so, they introduced Circles, a brilliant function, which allows users to easily click, drag, manage and categorize all of their online friends. It has video chat too. And aesthetically, the overall look and feel of Google+ is far more pleasing than Facebook.

But here is the problem — Google hit the market pushing a beta product. One that established ground-breaking social networking functions, like Circles, before it was fully really ready for the masses. Doing this gave Facebook the time to learn from Google+, since it was still under development. Consequentially, Facebook capitalized on what Google+ suggested the new table stakes were in the social media marketplace, and eventually improved upon its own, less powerful, product.

Very wisely, Facebook has now added video chat capabilities. Moreover, they recently announced “smart lists”, a function that automatically creates circles of friends for the online user.

My suggestion for Google+, do not push your service to the masses if it is not yet ready for the masses. Your brand is all about serving people and having those users connect efficiently with one another. By rushing to introduce your product, you have given Facebook the time and knowledge it needed to improve upon its weaknesses.

Ultimately, this gives users less of a reason to change from Facebook to Google+. And why would they, especially since Facebook can now do everything that Google+ can do?

Maybe this is why the last post from one of my aforementioned, technologically savvy friends was made five days ago on Google+, yet on Facebook, just five minutes. Seems like the incentive to change platforms is no longer there.

As we head into the holiday weekend, data shows that consumers are shopping online more and more with a reported jump of 12% in online sales already.

With that in mind, it begs the question: Will brick and mortar retailers become extinct?

The answer is yes, although it will take many years and local retailers will suffer more than the large ones who already have a expansive presence online.

There are a handful of reasons why retailers who depend on foot traffic should worried, but here are two new ones:

• It’s becoming easier for shoppers to buy online. Retailers, as Forbes has reported, have drastically cut the major impediment to buying online – the cost of shipping – by either offering free shipping or shipping at greatly discounted cost.
• Technology has allowed shoppers to find the best deals online with apps that search the web for the lowest price on just about any product.

Some retailers find ways to battle online retailing (called, e-tailing in the biz) by putting up as many locations as they can in an attempt to offer “immediate” instead of “next day,” but that doesn’t help them in holiday shopping not to mention the costly investment.

It would be easy to say this shift is the way of the world – wonder what our cities will look like then? – and mention that online shopping more accurately reflects the changing consumer who prefers quick & easy and control.

Those explanations are correct, but the retailers have themselves to blame. We, at Stealing Share, have often written about failure of most retailers to build a brand that creates preference, and some retailers we’ve worked with have been listening.

Most, however, just copy each other and battle on location, price and convenience. When those are the battlegrounds, online is guaranteed to win.

But it’s a reminder that a brand’s power is that it overcomes those market forces. Because the best brands are so emotional – and operate on a deeper, more resonant plane than tactical elements such as price and convenience – it doesn’t matter to consumers how they navigate the logistics.

It only matters “Why?” (Because it is a reflection of “me.” I am powerless to reject it.)

Until retailers both large and small wake up to that fact, they will find themselves continually fighting over the same ground and always fighting the same technological and operational battles – without market share changing a lick.

Best Buy reported third quarter figures that fell short of what Wall Street was expecting. The electronics superstore was also downgraded by Oppenheimer from “outperform” to “perform,” lowering the stock price outlook from $53 to $39.

So what is going on with Best Buy?

Best Buy’s pat answer is that sluggish TV and laptop sales are to blame. To a certain degree, that’s true. But I think that there is more to the equation than that.  Apple is not bemoaning their sluggish laptop sales and, every time I walk into Costco, it has added more space for its stable of TVs. Same for Walmart and Sam’s.

I am not saying there hasn’t been an industry-wide weakness in TV sales. But for Best Buy to blame its problems on TVs and laptops is akin to burying your head in sand. The problem is far deeper than that.

What got me thinking about this was an article from Fortune, which talked about the state of affairs at Best Buy and made the argument that consumers are going online and to specialty stores. The argument is that consumers are getting better deals, better customer service, and better warranties – and that’s what driving folks to online and specialty.

To a fair degree, this is correct. But again, this is only part of the story. In part, because Best Buy has its own online retail site, meaning consumers could go there. So why aren’t they?

It lies in the answer to the question, what does Best Buy mean to consumers? In thinking about the name and logo one would naturally think of “Best Price.”  This is clearly not true.

Best Buy’s holiday television ads center around the theme of expertise. However, I looked and here are the qualifications of a sales associate for Best Buy:

Basic Qualifications:
- 6 months of retail sales or customer service experience
- This isn’t a desk job! Lifting up to 50 lbs., standing and moving up to 100% of the time
- At least 16 years of age

Preferred Qualifications:
- High School Diploma or Equivalent

I am no HR expert, but this does not scream out to me as “category expert.”

I put it to you that, if you asked most people, “What comes to mind when you think of Best Buy?” they would say, “Electronics” or “Nothing.”

This is the reason for the slower than expected sales at Best Buy. Consumers are not going to another “store for a better deal, better warranty, or better customer service.  They are going away from Best Buy because it  has not given them a reason to shop at there.

There is no emotional connection with the target audience at all and, the sad thing for Best Buy, is it’s starting to feel out of date. Looking for a better deal, better warranty, better customer service, and any other reason you can think of are simply rational explanations for the lack of emotional connection.

What this demonstrates is the economic ramifications of not investing in building brand meaning.  Best Buy must invest in creating a brand that means something to customers before it got to the point in which Wall Street expectations are not met and the norm is a downgrading stock outlooks.