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Steep Discounts For Holiday Retail Sales Not News

holiday retail salesEvery dire prediction for holiday retail sales always comes down to discounting and haggling.

This is not news and hasn’t been news for a long time. Take a look below for some highlights from the past several years:

From the Boston Globe, November 23, 2008, “Consumers will look for bargain-basement prices to help meet austere budgets, while retailers from Wal-Mart Stores Inc to Saks Inc learn if they have the right products at the right prices.

From the Chicago Tribune, October 29, 2007, “According to a new study by BDO Seidman, LLP, one of the nation’s leading accounting and consulting organizations, almost three-quarters (73%) of chief marketing officers at leading U.S. retailers believe discounting and promotions will be more plentiful this holiday season compared to 2006 due to the current credit crunch.

From CNN, December 11, 2007, “In some instances, consumers say they’re simply turned off by poor customer service or not enough discounting.

From Bloomberg, November 25, 2006, “Holiday discounts this year seem to be locked in a range between 20 to 60 percent.”

From the New York Times, November 28, 2005, “The disparity, analysts said, could indicate a tough season ahead for clothing retailers like Gap and Aéropostale and even deeper discounts for shoppers as the chains scramble to build momentum in the crucial approach to Christmas.

From The Associated Press December 2004, “Retailers are expected to increase discounting before Christmas after a late-buying binge failed to materialize during the weekend, fueling worries that industry profits could be hurt in the fourth quarter”

From CNNMoney, November 28, 2003, ” Despite signs of a pickup in the economy and an improving labor market, consumers don’t appear to be feeling the Yuletide cheer.  The Conference Board in a survey Monday said U.S. households on average are expected to spend $455 on gifts this year, down 5 percent from 2002.

It went on…

“The 5 percent drop is shocking,” said Delos Smith, economist with the Conference Board, a New York-based business research group. “It indicates that perhaps the consumer tax rebate stimulus that benefited retailers during the back-to-school season has petered out.”  Analysts say it’s the discounters such as Wal-Mart and Target that are expected to ring in the bulk of holiday sales, while department stores will offer the most aggressive promotions.”

Does all of this sound too familiar?  It should – its an easy story to tell every year at this time of the year.

That won’t stop any number of news sources from touting retailers “aggressive discounts needed to lure customers this holiday season” and how they aren’t working.  Look for those stories this weekend.

There’s only one way to compete, you have to bring humanity to your salesfloor, appreciate that a customer drove past two or more of your competitors, decided not to buy on their smartphone and walked  into your store.

They deserve the best treatment so you won’t be part of next month’s story of another retailer having to close.

How To Move Your Customer From Good Enough To Your Premium Product

retail sales training premiumIt seems that comparison-shopping, discounting and getting the best price is all that drives customers any more.

Abandon retail sales training and put the money in omnichannel so you can reap the benefits is what conventional wisdom is telling retailers large and small.

But in their quest for the lowest price, shoppers have often missed the concept of premium products. And so have their employees…

Take Trader Joe’s Two-Buck Chuck. A salesman said, “It’s functional wine. That’s the best description I can give.” When the consumer settles for generic wine that can get them drunk, how will the wine merchant ever get new customers to explore wine’s vast variations and subtleties? Same with the best coffees and chocolates.

When a 72 dpi photo of a magnificent sunset is going to be altered and posted on Instagram anyway, what will happen to the budding Ansel Adams out there without a trip to the camera store?

Instead of searching for the best possible product, consumers are increasingly looking for ones that meet their needs and for the least expensive option.

In short, the American consumer seems to be in full retreat from the trend covered in the landmark 2003 book, Trading Up: Why Consumers Want New Luxury Goods, where we were told that everyday objects that cost more also mean more to the average consumer.”

Now it seems extraordinary products mean less to the average consumer. Continue reading How To Move Your Customer From Good Enough To Your Premium Product »

Marketing With Coupons: Do You Need a JC Penney Drug Intervention?

“Coupons were a drug,” - Ron Johnson, JC Penney CEO

coupons are a drug

Beginning over ten years ago I was the lone voice saying coupons don’t work to market a profitable retail business in my first book, You Can Compete.

When Groupon and the rest came in a couple years ago, I shouted even louder.

Still a lone voice.

But were my fans listening?

Sadly, not all of them. Continue reading Marketing With Coupons: Do You Need a JC Penney Drug Intervention? »

Retail Sales Training: Lessons From Sears Glory Days

retail sales training

When I began my retail career, it was common knowledge that in many appliance stores there used to be a “loss-leader” that was heavily advertised;  a washer with a “the  golden spike” in it if you will.

The understanding was if you the saleman sold one, you would be  gone because you couldn’t sell; a salesperson’s job was to sell the profitable item.

Sears’ had a different sales strategy I’m told by a former principal, “Sears sold up by selling down.”  They presented a full line of each appliance, from a stripped down model you probably didn’t want, to a model with gadgets that you really didn’t need. Continue reading Retail Sales Training: Lessons From Sears Glory Days »

7 Reasons Coupons Shouldn’t Be Used For Your Retail Marketing

One of the things I typically do as a retail consultant when I take on a new client is to discontinue discount marketing programs.

In fact, I often raise their prices to help them become profitable.

Before you read on, if you are one of the extreme couponers or use them religiously, this site, this blog and this post are not for you. Continue reading 7 Reasons Coupons Shouldn’t Be Used For Your Retail Marketing »