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How the Marketing World Is Surviving 'Snowmaggedon'

East Coast Storm Wallops Retail, Travel Sectors; Grocery Biz Booms; and Most Ad Folks Get a Snow Day

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NEW YORK (AdAge.com) -- The bar at the Marriott near the Pittsburgh airport was full of New York Giants fans Sunday night watching their football team lose to the Green Bay Packers. But these fans had bigger worries than their woeful football team. They were among the thousands stranded far from home thanks to flights that had been canceled or diverted.

Retailers will have to extend post-holiday sales for the next few weeks to move old inventory, said Marshal Cohen, chief retail analyst for NPD Group.
Retailers will have to extend post-holiday sales for the next few weeks to move old inventory, said Marshal Cohen, chief retail analyst for NPD Group. Credit: Todd Stone
The storm that walloped the East Coast the day after Christmas paralyzed air traffic, deterred shoppers from redeeming gift cards and returning that horrific holiday sweater from Grandma, snarled roads, shuttered offices and idled public transit in bustling business centers like Manhattan. It was largely a non-event for many ad agencies already closed for the holidays; it was a nightmare for travel providers trying to placate the stranded on social networks and Twitter; it was a boon for some businesses like food stores, cold-weather gear sellers and enterprising folks like taxi drivers -- and rap stars.

"I'm going out to shovel snow and see if I can make me a few extra dollars today," tweeted 50 Cent. "I'm charging more if they want to take pictures."

Retailers will eventually recoup sales from Dec. 26, one of the top-five retail days of the year, but "it could take two weeks to make up for the kind of traffic that comes into stores after Christmas -- that's how many people shop on the 26th of December," said Marshal Cohen, chief retail analyst for NPD Group. That traffic is primarily driven by gift-card redemption and returns, he added.

Retailers will have to extend post-holiday sales for the next few weeks to move old inventory, he said. With those extensions, it'll also be necessary to run more ad campaigns to promote those continued post-holiday discounts.

But NPD consumer-electronics analyst Steve Baker said he expected the snowstorm effect to be minimal on overall post-Christmas sales because the blizzard was a local phenomenon, and also because even in the affected areas, shoppers could either shop online or eventually dig out and return to stores a day or so after they had initially planned. He said that last year's pre-Christmas blizzard in New England and Mid-Atlantic states, while it did have an effect on sales the actual day of Super Saturday, likely amounted to simply a one or two-day pause in overall sales.

"From an ad standpoint, that's good news," said NPD's Mr. Cohen. "But from an expense standpoint for retailers, it'll take longer to clear inventory to make room for new inventory, and deeper discounts to get rid of the old."Regional retailers will most likely be hit hardest -- BJ's wholesale club is the retailer most affected with 77% of its stores in the eye of the storm, according to Planalytics. Compare that with Target , with only 29% of stores were affected, and Macy's 39%.

Yet trade organization National Retail Federation doesn't anticipate serious fallout from the storm. "The week [after Christmas] itself is also just as important for retailers as the days after," said a NRF spokeswoman. "If this storm had happened leading up to Christmas, it may have made a little more of a difference."

Of course, it wasn't all bad for the retail sector. The snow meant big business for grocery stores as customers stocked up on essentials in advance of the so-called snowpocalpyse. Grocery-store parking lots were packed in Northern New Jersey and Rockland County, New York on Sunday and the ShopRite in New Rochelle, N.Y., customers gobbled up milk, eggs and frozen foods. "We were going crazy," said store supervisor Ronald Montague. "We couldn't even control the lines."

On Monday, anyone trying to reach the supermarket chain's customer-service center was out of luck -- it was closed "for the safety of our associates," according to a recorded message.

But for some marketers, the work didn't stop. Christopher Guzman, an ad manager for Alpha 1 Marketing -- the marketing and merchandising arm for C-Town, Bravo and Aim supermarkets -- braved the commute from the Bronx to White Plains. "I'm pretty much the only one that's here," he said. "I have to be here because obviously we have deadlines and stuff we have to meet."

Home Depot stores on the East Coast had strong demand for snow blowers, shovels and ice melt, a spokeswoman said. Stores were "very busy" on Sunday in advance of the storm, and demand continues today for snow-related products, she said.

The picture was bleaker at many of the nation's airports, where travelers cooled their heels while service was shut down to such crucial hubs as JFK, LaGuardia and Newark Airports. There, too, was a silver lining for airport hotels and other travel service businesses in cities where people were stranded. At the Hyatt at Pittsburgh Airport business was brisk, and one Pittsburgh taxi driver told a pair of stuck travelers that he was grateful for all the business the stranded were generating on what would otherwise be a very slow night.

The Hyatt, which is connected to the airport in Pittsburgh, went from about 50% occupancy Sunday morning to nearly full, said Cecelia Baer, assistant front office manager. Because the cancellations were weather-related, passengers were not given hotel vouchers by their airlines but were offered "distressed-passenger" rates, she said. For some, that wasn't enough to curb the disappointment of not making it to their destination.

"We're the first person they see [after the flight cancellation], so we take in a lot of venting," she said.

One airline quite familiar with venting pulled out all the stops to be responsive in this travel crisis -- JetBlue, which in February 2007 suffered a PR disaster when 10 of its flights sat on the tarmac during a winter storm with hundreds of passengers stuck on the planes for up to 10 hours with little food and limited toilet usage.

At the time, CEO David Neelman said he was "mortified." But JetBlue came up with a Passenger Bill of Rights and survived the PR nightmare, in large part due to being far more proactive. For instance, from Sunday through early this afternoon, JetBlue had 36 tweets regarding the storm; American and United, by comparison, had a combined four.

"We're doing our best to keep our customers updated," JetBlue spokesman Mateo Lleras said. "We're using our social channels on Twitter and Facebook, and we're directing them to our online page. We're trying to keep them updated on flight status, and we're making sure they know that we're waving fees for customers to re-book flights until Jan. 14. The idea is to keep them as updated as possible using all of our channels."

American, as of early this afternoon, still didn't have a travel alert up on its home page on aa.com. "I just saw a memo within the last half-hour that the Twitter people are going to push something out, and I'm sure we'll do Facebook as well," American spokesman Ed Martelle said this morning, adding that the airline sends e-mail flight status notifications to all customers who sign up for that service. "It's a moment-to-moment thing in which we have to encourage them to stay in touch with us. ... It's going to take us, once airports are operational, a good day to move all that hardware and software around."

And it appears that every airline is having a serious problem with its phone service. "Seriously, American Airlines? The put-the-caller-on-hold-and-hang-up-trick is so last decade," tweeted one frustrated flier. Another, flying JetBlue, tweeted, "How come I can't rebook online? Getting disconnected every time I call is very frustrating."

Said Mr. Martelle, "We had so many calls yesterday that we just ran out of lines. We're in the process now of getting more lines up and bringing more people in to handle the volume. This is almost an unprecedented storm, and couple that with holiday travel and it's a double whammy."

Even international airlines are feeling the pain as JFK International, Boston Logan and Philadelphia International were all closed -- or still are. "We're telling people flat out, don't come to the airport," British Airways spokesman John Lampl said. "At the same time, we're trying to re-book. Everybody just has to hunker down for 24 to 36 hours. It's just a matter of time before it's back to normal. It's just back luck that the storm happened around Christmas, when everybody is trying to return."

Mr. Lampl said BA was successful in getting some of its customers into local hotels, even in New York.

The airlines' loss in many cases has become the railway's gain. One frustrated traveler decided she would take a train from Pittsburgh to Washington, D.C. and then to New York. The roundabout train travel would still get her home to New York before her airline's next nearest flight could -- on Thursday.

If search is any indication of consumer sentiment, it looks like all people cared about Monday morning was travel. As of 9:00 a.m. Eastern time, the only non-travel or snow-related search term on Google's top 10 hot searches list was the e-commerce tech company " GSI Commerce," likely because it's CEO Michael Rubin appeared on a re-run of reality show "Undercover Boss" on Sunday night. New York's subway system MTA, New Jersey transit and other commuter rails dominated the top-ten. (No search advertisers seem to be piggy-backing on these popular terms yet; None of the top-hottest search terms, including number-three "snowfall totals," bring up accompanying search ads.)

Though travel problems in the Northeast don't seem to have broken into national consciousness, at least not on Twitter. Travel terms like LIRR, Amtrak and Metro North were trending on Twitter in New York on Monday morning, but not for the country as a whole. Among the top 10 search terms over the last 30 days in New York, New Jersey, Connecticut and Massachusetts were snow boots, snow tires and winter snow.

Even Christmas Town -- Christmas Town! -- couldn't open its doors. The Busch Gardens amusement park attraction in Williamsburg, Va., was forced to close the popular attraction due to the weather.

Damon Jones, a spokesman for Procter & Gamble Co.'s men's grooming business based in Boston, said the company had a scheduled holiday today and expects operations to be able to reopen by tomorrow. Unilever closed its U.S. headquarters in Englewood Cliffs, N.J., today and is in what spokeswoman Anita Larsen termed "agile working" mode, which she said in an e-mail "makes events like today almost irrelevant." The so-called AW system, she said, encourages employees at all levels to "work anytime from anywhere as long as business needs are fully met" and determines performance based on "results, not by time and attendance," with managers assessed annually on how well they support Agile Working in their groups. The idea is to help lessen environmental impact, improve recruitment and retention and foster effectiveness of virtual teams, she said. But it also helps in a snowstorm.

If you worked for an agency, chances are you were less inconvenienced. Those who were not already closed, such as Ogilvy, MPG and Digitas gave employees a holiday gift of a snow day. On Sunday night, Digitas (http://twitter.com/#!/digitas) tweeted: "It's a winter wonderland! Digitas NY, CT and BOS offices & @Digitas_Health in Philly will be closed MONDAY, 12/27 due to severe weather."

Given that many top execs were scheduled to be out of the office until the New Year, major disruptions in agency business are not expected. But the snow did seem to stalk one executive all the way across the Atlantic.

David Armano, the Chicago-based senior VP at Edelman Digital, last week was stranded in the snowstorm that hit London. Mr. Armano made the most of it, creating a Twitter hashtag "#armanogeddon" that friends used to send him support.

"After several days, canceled flights, long phone calls with airlines and numerous visits to London pubs as well as befriending other stranded visitors I made my way back to the states," he said in an email. "But the snow followed me here to New York," where he is visiting relatives.

"Many of my Edelman colleagues are stranded in cities across the country as now NYC airports are closed and my social-media friends have asked me to stay away from there cities in an effort to keep the snow away," he said.

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Contributing: Abbey Klaassen, Kunur Patel, Rich Thomaselli, Irina Slutsky, Beth Snyder Bulik, E.J. Schultz, Jack Neff

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