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Feb 4, 2010 by Mark MaierI don't think anyone would disagree that changes with consumers are bound to bring changes to strategy and Radio Sales Today brought out a couple of things that are important for us to understand...
"1. What you can buy
Retailing is more competitive than ever, so stores have to focus on exactly what the customer wants to buy, says Kevin Sterneckert of the retail advisory firm AMR Research. They need to have a store-by-store sense of how much to stock.
The 2009 holiday season was the trial run of retailing's new less-is-more buying philosophy. Largely positive retail sales and earnings reports bore out the wisdom of the strategy.
Stores will continue to under- rather than over-buy so they don't have to resort to costly -- for them -- clearance sales.
2. How much you'll pay
Everyone from the CEOs of Family Dollar to Saks talks about "value" these days. But that doesn't mean stores are going to be doing much deep discounting in 2010. That's so last year. The trend going forward will be more regularly scheduled sales and more-attractive starting prices.
Even the dollar stores are having to go more downscale. Family Dollar CEO Howard Levine says his stores focused on $5 gift promotions over the holidays and will continue to stress necessities over nice-to-haves such as apparel and furnishings.
Retailers also will be using smaller packages and making cheaper versions of products that they can charge less for, says Janet Hoffman, retail practice leader for consulting firm Accenture
3. What you'll see in stores
Stores will be geared more toward service and the education of consumers about products. They'll also be a lot more fun.
With consumers shopping less often, "When they think about going out, you want them to think about you," says Chris Dull, president of franchising for NexCen Brands, which owns chains including The Athlete's Foot, MaggieMoo's and Marble Slab Creamery.
Events and entertainment are becoming increasingly common in stores and malls.
"As online sales go up, retailers have to get creative to get people in," Hoffman says. "There will be more tastings, more demos and more gimmicks to get them in the door."
4. How green stores will be
Stores, including L.L. Bean, are being redesigned to be more environmentally friendly. The number of "green" products is being increased at Wal-Mart, Target and other stores. And you may find yourself paying for the privilege of using a plastic bag -- or being rewarded for reusing -- at more stores.
Much of the environmental emphasis is behind the scenes and focused on saving energy to save money. When it comes to energy, "Any savings immediately hit the bottom line," says Peter Graf, who heads sustainability for the business software company SAP.
And the other items that we need to understand is how to help our clients become stronger by understanding more about themselves, sometimes as easy as just asking the right questions...
"The local players must be realistic in determining their strengths, weaknesses, challenges and opportunities. They must identify and vigilantly promote their unique selling proposition in order to compete.
To help your clients determine their unique strengths, you should help them discover why their customers patronize their businesses. Is it the quality of the merchandise, the vast selection, their pricing, their speed or their customer service that stands out? Once you know what it is, develop creative campaigns to promote the strength(s) (without using the obvious clichs).
Also, be honest with your clients about their weaknesses. Are the weaknesses fundamental problems outside of their immediate control (bad location, poor facility, hidden signage, etc.), or is there room for improvement? For the latter, they will probably appreciate your honest assessment along with suggestions of ways to improve. Help them to overcome or minimize the effects of their weaknesses through promotion.
Are there new competitive challenges encroaching on their market share? If not, there probably soon will be, and you should help them prepare by solidifying their current market position. Are there current opportunities that have not been capitalized on or future opportunities that have not been recognized and planned for? When you start identifying new revenue opportunities that have not been previously considered, you will win customers for life."
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