PERSPECTIVES

From The Co-Founders

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Tips, Tactics & Strategic Insights and Commentary
from The ROI Co-Founders, Pat Johnson and Dick Outcalt
Outcalt & Johnson: Retail Strategists LLC; Retail Turnaround Experts

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The Lingering Days of Summer

Since Labor Day in the US is the first Monday in September, this year it happens as late as possible. Labor Day will not be celebrated until next Monday, September 7. 

Most years, most folks would be perfectly happy to have August stretched out even longer. Ahh, those lazy, hazy, crazy days of summer, right?

  • Well, we DO have the "crazy" part down pretty well. And "hazy" rings true too, as the fog of uncertainty persists.
  • And now, imagine it: a Zoom Thanksgiving... OMG!

And so, meanwhile, we regard Consumer Confidence as THE key indicator of consumer spending. Just last week, the Conference Board reported that Consumer confidence is at a six year low*. Ouch!

But, was that a surprise to retailers? Not really. Most retailers are well along in coping with these challenges. 

For instance, while this year's Back-to-School season was subdued, it did reward those retailers who thoughtfully anticipated how their customers would be adapting to 2020.

And those same trends will be playing out for Holiday 2020 as well. 

  • It is not rocket science to recognize that spending on discretionary items will continue to be down.
  • Replacement shopping will prevail.

One of the biggest changes in Holiday purchases will be the reduced spending on "experiences": tickets to concerts or sporting events; ski lift tickets; travel; restaurant gift certificates; etc. For the first time in many years, in 2020 there will be more focus on gift giving of actual items. 

  • The savvy retailers we know already are well down that path of focusing their Holiday buying on their basics, that is, what their best customers know them for, and look to them to provide. 
  • They also have explored some of the new online wholesale platforms that feature newer or smaller vendors and lower minimum orders to add a lesser-risk sprinkling of unique specialty items.
  • Meanwhile, these retailers have been improving their technology,streamlining new delivery services or curbside pickup, expanding their online payment systems, doing what they can to make it easier for their customers to buy from them.
  • And perhaps most important, finding new ways to reach out to and connect with their customers. 

We are reminded once again that there are Three Kinds of Retailers. 

  1. Those who MAKE things happen.
  2. Those who WATCH things happen.
  3. And those who say, "Umm, what happened?!"

And once again, it is the independent retailers who predominate in that first group.
 

Consumer confidence tumbles to new pandemic low after summer viral outbreak. Jeffrey Bartash, Market Watch. August 25, 2020.

Related Articles

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    Christmas Week Is Only 90 Days Away. Amazing, or What?!

    Consider this: Will this Holiday Season happen... 

    • In traditional RETAIL Time? 
    • Or always-on INTERNET Time? 
    • Or, the grinding PANDEMIC Time? 
    • Or, some combination of all of it?

    What a 90 days it will be! 

    Remember July and early August, when there was much optimism? 

    • Consumers were excitedly resuming in-store shopping and dining. 
    • Social gatherings were increasing. 
    • Pent up demand was high. 
    • And shoppers were eager to make this year extra special to compensate for last year. 
  • COVID-19 thumbs/ReadySetGo2.png

    Just a few more days until...the 26th!

    The savvy retailers know that now is the time to be putting the finishing touches on – wait for it – being ready for December 26!

    Yes, this unique time period between December 26 and New Year's Day is a tremendous make-or-break opportunity. Indeed, many retailers find they net more from this time than any earlier stretch of 6-10 days!


    Why? Three main reasons.

    First, the many opportunities to reduce expenses "back to normal". Less advertising cost. Less staff. Fewer hours.

  • Try A Shorter Work Week?

    Bold Way To Improve Productivity 

    As we look around, we see a popular cost-saving and productivity-boosting tactic being instituted by many national retailers, shopping malls, and restaurants. They are open fewer hours. 

    This offers an opportunity for you to revisit your store hours and employee scheduling practices. Maybe it's time to consider some changes, if you haven't already. 

    Your customers have voted with their feet. Your goal is to see what patterns there are in their shopping visits. (This could be a fine project for a summer employee home from college.)

    Start small; focus on , say, the last four weeks of data collected by your POS system. But this time, produce reports by the day of the week. Yep, seven columns of data. Wait till you see what it can reveal!

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    Continuing Flexibility Test

    As we introduced previously, the New Normal for retailers is already here. It is a new "retail clock." 

    • "As the global efforts to "flatten the curve" of the coronavirus pandemic continue, there is another curve that is being flattened. That would be the seasonality of retail sales. 

      "And this may prove to be what really defines the New Normal for retailers. 

      "The customary peaks of retail spending have been flattened."

    Of course, it is not just retailers who have been affected; the shoppers also have been adapting. But whereas retailers think in terms of seasons (weeks and months), the shoppers are adjusting their patterns at the daily and weekly level.

  • COVID-19 thumbs/Fenton-cptn.png

    Get Your Tents and Sidewalks Ready!

    As more stores are able to reopen, and more shoppers are willing to emerge, what will they encounter?

    • "A glut of pent-up inventory is waiting to be dumped on consumers this summer as retail stores reopen in the U.S., and shoppers for everything from shoes to sofas should be able to find major bargains," reported the Wall Street Journal* on June 2.

  • Thanksgiving Is "Late" This Year

     

    "Christmas will be here before you know it."

    Well, actually, Christmas will be here the same time it always is: December 25. 

    However, what does change are the cues for the shoppers. 

    That is, Thanksgiving falls as late as it can this year, on November 28. That means, for those keeping score at home and for the breathless business pundits, there are only 26 shopping days between Thanksgiving and Christmas. This is six days shorter than a year ago, and the shortest since 2019.

    That's why some retailers, especially those that are publicly traded, are making mighty efforts to lengthen the shopping season. 

    But, is there actual value in trying to prompt shoppers to start their Christmas shopping before they have even handed out Halloween candy? Yes, but...



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