The Staples turnaround: That was easy
Business 2.0 reveals how Staples needed to simplify itself before it could reap the rewards of its new Easy Button ad campaign.
SAN FRANCISCO (Business 2.0 Magazine) - Eight to one. That was the abysmal ratio of customer complaints to kudos at Staples stores in 2001. The company's slogan - "Yeah, we've got that" - had become laughable. Customers griped that items were often out of stock and said the sales staff was unhelpful to boot.
After weeks of focus groups and interviews, Staples's executive VP for marketing, Shira Goodman, had a revelation. "Customers wanted an easier shopping experience," she says.
Staples's subsequent rebranding effort is one of the most successful mass-marketing campaigns in recent memory, and one of the most holistic. Rather than simply bombarding customers with a new slogan - "Staples: That was easy" - Goodman and her team led a companywide overhaul to simplify the shopping experience.
Better yet, the marketers created an iconic object, the Easy Button, which customers are now buying at Staples stores in droves, helping to spread the marketing message.
The five-year branding odyssey that began in 2001 has helped make $16.1 billion Staples the runaway leader in office retail. In 2005 its profit was up 18 percent to $834 million. Second-place Office Depot (Research), meanwhile, booked 2005 earnings of just $274 million, an 18 percent slide, and OfficeMax (Research) posted a loss of $73.8 million.
Staples (Research), Goodman says, now receives twice as many compliments as complaints. Here's what the retailer learned along the way.
Living the slogan
Based in Framingham, Mass., Staples all but invented the office-supply superstore when it launched in 1986. Targeting small and medium-size businesses, it aimed to sell everything for the office under one roof.
But by the mid-1990s, the space was crowded with retailers like Office Depot, not to mention Target (Research), Wal-Mart (Research), and a slew of other online and offline shops. As a result, Staples's same-store sales fell for the first time in 2001.
Customer research conducted by Goodman and her team revealed that shoppers placed little importance on price but overwhelmingly requested a simple, straightforward shopping experience.
"They wanted knowledgeable and helpful associates and hassle-free shopping," Goodman says. The "That was easy" tagline was the simple - yet inspired - outgrowth of that realization.
The slogan, however, was kept under wraps until the company could give its stores a major makeover. Staples removed from its inventory some 800 superfluous items, such as Britney Spears backpacks, that had little use in the corporate world. Office chairs were moved from the rafters to the floor so customers could try them out. Staples also added larger signs and retrained sales associates to walk shoppers to the correct aisle.
It took about a year to get the stores up to snuff, Goodman says, but in March 2003, they were ready for the tagline. By the summer, Staples saw a 5 percent rise in same-store sales - which Goodman attributes more to the easy-does-it push within stores than to the catchphrase itself.
Creating a gimmick
To reinvigorate its advertising, the company in mid-2004 hired McCann-Erickson Worldwide, which also created MasterCard's nine-year-old "Priceless" campaign.
Shortly after winning the account, a group of McCann copywriters and art directors held a marathon brainstorming session. Leslie Sims, a senior VP and group creative director, mentioned how nice it would be if she could just push a button to come up with a great ad, so they could go to lunch. The Easy Button was born.
A string of Easy Button commercials premiered in January 2005 and also aired during the Super Bowl a month later. In one spot, called "The Wall," an emperor uses the button to erect a giant barrier as marauders approach; another shows an office worker causing printer cartridges to rain down from above.
Online, Staples created a downloadable Easy Button toolbar, which took shoppers directly to Staples.com, while billboards reminded commuters that an Easy Button would be helpful in snarled traffic.
As a result of the advertising onslaught, customers began asking about buying real Easy Buttons. In September 2005 the company began selling $5 3-inch red plastic buttons that when pushed say; "That was easy." This quarter it will sell its millionth button.
Not since Taco Bell sold 13 million talking Chihuahuas in 1998 have customers so coveted a product based on an ad campaign.
By selling the Easy Button as a sort of modern-day stress ball, Staples is turning its customers into advertisers. Homegrown movies starring the button have appeared on video-sharing site YouTube.
Sticking with the strategy
The payoff is striking. Staples says customer recall of its advertising has doubled to about 70 percent, compared with the industry average of 43.
Investors have also been rewarded: Staples's share price has risen 37 percent during the past year to $26.60 as of early May. Both Staples and McCann attribute the financial success at least in part to the "Easy" campaign's longevity. "You need a client who's willing to invest the time to see the benefits," Ohler says.
There's no guarantee, however, that the five-year-old "Easy" push can maintain its momentum. A marketing campaign is a pricey endeavor- Staples spent more than $160 million on advertising in 2004 and 2005 combined, according to Nielsen Monitor-Plus - and if earnings lag, ad budgets are among the first things cut.
For the time being, though, the button seems to have insinuated itself into popular culture. This fall Staples will unveil a new back-to-school TV campaign featuring the Easy Button.
But Goodman believes that Staples's success will continue to ride on minimizing the hassle of the in-store experience. "We're in the early stages of what can be a very strong retail brand and message," she says. She makes it sound so easy.
This is an excerpt from a story in the June issue of Business 2.0. To read the complete version, click here.
Michael Mystery is a freelance writer based in New Jersey.To send a letter to the editor about this story, click here.