I have heard so many good reports about our retailers sales during the past holiday season, that I was a bit stunned to hear also the contrary from several others. You can imagine my surprise to hear from a couple of retailers that their holiday sales were worse than 2009. “How could that be?” I asked myself. With so many variables to consider I went on sort of a quest to see what the similarities and differences were between the two extremes and then how each of them might approach the upcoming spring season.
I first had to consider the demographics and local competition. For the retailers that were extremely successful, most were located in shopping districts. There was retail energy and perhaps this offered shoppers a reason to park and frequent several stores rather than a single destination. In some of the tightest demographics we offer in our region, this proved to be the most successful formula because there was a greater concentration of customers in relationship to the area. Some stores that are destination located may have suffered from customers wandering to places where they could shop around.
That being said, there were several retailers that are truly an oasis for their community and they too seemed to have thrived this season. I then had to consider both their level of customer service and assortment of products. That, which has always been the consistent success formula throughout past holiday seasons has been retailers who offer great customer service. People want to be treated well: be greeted by sales persons and helped in selecting gifts. They like their gifts wrapped nicely and are grateful for help to their car with packages. I saw this as one of the most important ingredients for continued success not only during the peak season, but throughout the year.
Busy retailers spent a lot of time promoting their own stores from September through December. Some of our retailers have become particularly savvy at sending out email blasts promoting events in their store. My personal favorite event was “Take your pet’s photo with Santa.” It was very successful event and this clever retailer didn’t fail to report the success of the day to their customers after the event (generating even more energy). Many had holiday parties or after hours sip (wine) and shop. The creativity was endless and excellent. On the other hand there were a few retailers who turned down offers of free trunk shows or who had excuses as to why they didn’t want to bother with a holiday open house.
The most important ingredient I noted of our triumphant retailers was having timely and appropriate inventories for the season. Many of these retailers brought in goods early and consistently, making sure that they always had fresh assortments throughout the season and maintained stock levels. Almost every retailer worked within budgets and made educated decisions on where their purchases would give them the biggest bang for their buck. Although special orders were a bonus, the winning strategy was to sell merchandise off the retail floor. It was not the season to sit behind the cash wrap and wait for the season to arrive. I also noted several retailers who just couldn’t budge on ordering.
Contrary to those who flourished, the retailers who struggled may have done the following: They ordered too late and were left with a limited amount of second class products. They relied too heavily on special orders, losing both floor sales as well as special orders when goods were no longer available. They didn’t have holiday events, promote their stores or reach out to their communities to say they were “special.” It is difficult to have watched this unfold. I realize that some were just at the end of their financial abilities and may have been too scared to figure the way out. If they don’t pull it together, they may just suffer their own private recession in 2011.
How do both these retailers proceed into spring with such extreme experiences? Each has a different path to walk, but I believe each can be successful. The only big difference is the profitable retailer has some financial breathing room to replenish inventory and bring in new products and the struggling retailer will have a much longer and possibly a more risky road to navigate. With this in mind, here are some suggestions for moving forward into spring:
- Replenish fashion basics. These will serve as a foundation and offer consistency from which to platform all other opportunities. The retailers with more cash may have the ability to layer on a wider assortment or additional products as basics.
- Turn the season quickly. No matter what the last season’s results may have been, having a Christmas sale and moving old inventory around is a recipe for disaster. Brighten & lighten the floor.
- Get something new in. New products and/or new collections are here and vendors are replenishing their warehouses albeit cautiously. Again, cash advantage retailers have more to spend and they will have bigger and brighter assortments, ultimately making them even healthier. However even the smallest and cash strapped retailer has to put something new on the floor or fail completely. A little something early on can go a long way.
- Promote to progress! If you can only bring in one or two new things, promote it. Let shoppers know that you have something new to offer. Put it out front and center and train your staff to sell it.
- Purchase a stream of deliveries. If you purchase for several deliveries, you will prepare your suppliers for production and better aid you in receiving timely merchandise. They don’t know what you want until you make it an order and ship dates can almost always be moved around if needed.
There are probably several other recommendations that I could make, but it is better to take my thoughts a launch point and let your creativity and intuition take the lead. Start now, we will be there to help.