Can Wineries Learn From Neiman Marcus?

Former CEO Richard Marcus addresses vintners on brands and marketing

by Tina Caputo
Richard Marcus
Richard Marcus
St. Helena, Calif. -- Richard Marcus, former CEO of luxury goods retailer Neiman Marcus, spoke to vintners last week about branding and marketing strategies. Marcus covered a broad range of subjects during his presentation, but placed particular emphasis on product focus, customer service and communication.

"Focus is important," Marcus said, in a follow-up interview with Wines & Vines. "Being able to speak clearly about what your product is, and not be distracted by having to explain too many products, is helpful."

Offering a top-quality product along with exceptional customer service are essential elements to building a luxury brand, Marcus said. "My father had a saying, and I think he was quoting his father, who said: 'Retailing is really pretty simple--if you take care of your customers, they come back. If you take care of your merchandise, it doesn't.' The idea is that each and every one of those customers has value, and that it's important to truly focus on the quality of what you offer, and not accept compromises that diminish that offering. If you do those things consistently and well, you should be at the right starting point to build the kind of business you want."

Marcus' father, Stanley--son of Herbert Marcus, who started the family business in 1907--often told his sales clerks that nobody can predict what any given customer is capable of spending. The lesson, Marcus said, "is that you treat them all the same." This means knowing each client, and focusing on them in a personal way. "We never liked the word 'consumer,'" Marcus said. "We preferred the word 'customer' because it implies an interaction."

Before the computer age, every Neiman Marcus sales associate was required to record information about each customer in a "clientele book," Marcus recalled. Twice a year, the books were collected and reviewed by a department devoted solely to helping the salespeople do a better job. Based on their past purchases, sales associates called customers to let them know about new items that would be of interest to them.

This practice still works in the electronic age, Marcus pointed out, thanks to e-mail databases. "You're going to need a variety of ways of talking to your customers," he said. "Clearly, with all of the electronic access that people have today to goods, services and information, you have to be intelligent in the way you talk to them."

Despite the impersonal nature of e-mail, he added, it's important to personalize communications with customers. "The question is, are you talking to all of those customers the same way, or are you shaping your communications depending on how that customer has behaved with you?" Marcus asked. "Tailoring communication to reflect the habits of individual customers is easily done today, and there are tools out there that provide even small businesses with some pretty robust analytics."

Though Marcus said he can appreciate some business owners' desire for overnight success, he stressed that building a luxury brand for the long term takes patience and time. "There are some businesses that are get-rich-quick businesses, and there are some that are get-rich-slow businesses. I don't think the wine business is a get-rich-quick business. You have to have a lot of patience to get the product right, and even when you do, you don't sell it for a while."

Marcus spoke at a seminar hosted by Silicon Valley Bank (SVB). The event was the first in a series of invitation-only seminars designed to help SVB's winery clients address their marketing concerns through discussions with legendary business leaders from companies outside the wine industry. For more information about the series, contact Sarah Ferreira at sferreira@svb.com.
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