Off-Pricers are in High Demand

More consumers are heading over to off-pricers for discounted prices these days. This recent article on RetailWire.com highlights how off-pricers like T.J. Maxx and Ross Stores are in high demand.

Not only though are people going to these stores but premium brands are beginning to dump a lot of their goods into these stores in order to get rid of inventory. Brian Tunick, an analyst at JP Morgan mentions, "You can clearly argue that the mid-tier department stores have no pricing integrity. Nothing goes out the door at full price, and that plays right into what the off-pricers do."

Product packaging afterlife is import to customers

Every three out of four consumers believe that it is important for a product's packaging to be recyclable. While sustainability of a package may not be a key selling point for consumers, it is one important factor that can alter their decision. Other key factors that weighed in on green packaging in consumers minds: recycled content (67 percent), refillable containers (63 percent), containers that are reusable for other purposes (60 percent) and compostables (51 percent).

For more on this topic, read the article here.

Selling Sugar: Bev Companies Rely on Nostalgia

Pepsi and Mountain Dew will soon be releasing their soft drinks without the use of high-fructose corn syrup. The beverage manufacturers have opted to use real sugar, which some claim to have better taste and nutritional value. According to bevreview.com, Pepsi has been experimenting elsewhere with sugar-sweetened drinks. We reported last February about two such entries… Pepsi Raw in the UK and Mexico's Pepsi Retro. It's nice to see some of this finally coming to the States. What makes this interesting for our purposes stems from the need that the bev companies have to make it seem almost retro to use sugar. Will nostalgia prove to be a benefit in marketing this to the American population, should they have taken another avenue?

Some Retailers Remain Solid through the Downturn Economy

This post on Retailwire.com discusses how even though many businesses are struggling through the recession, companies like Best Buy, Bed Bath & Beyond, Urban Outfitters and GameStop show promise that they will come out of the recession stronger than before.

Best Buy and Bed Bath & Beyond are looking particularly strong because they are avoiding one less competitor, Linens ‘n Things and Circuit City which both have faltered in the last couple of months. Urban Outfitters and GameStop have both seen an increase in total revenue from the previous year, and so seem to be in great shape.

What are other examples of chain stores that are doing well during this troubled state?

Shopping malls having to readjust to new shopper needs

In a recent article at the Pittsburgh Post-Gazette, they discuss how the malls in Pittsburgh are currently struggling with the current high amount of vacancies. Not only are they facing chains going out of business, such as Boscov's and KB Toys, but they also have less consumers who don't have expendable money for shopping. The article states that as many as 2000 to 3000 malls could go bankrupt this year.

As a result, malls are trying to find new ways to bring customers into their stores. Another potential option for under-performing malls could be a "de-malling," Mr. Ackerman said. That strategy, he said, has worked for North Hills Village, which has transformed itself over the years from a mall into a big box center that includes Best Buy, Target and Kohl's.

Read the article here. What do you think about the current state of malls? Will they find a way to readjust and make it through the current economic downturn?

Goodwill Sales Jump as Shoppers Race for Second-Hand Items

The Chicago Tribune reports that second-hand stores, specifically Goodwill, are seeing a huge jump in revenue thanks to the cash strapped consumer. According to the article, many retailers are scaling back expansion plans or closing stores, but non-profit Goodwill plans to open five stores a year from 2008 through 2012, doubling its cadre of second-hand outlets in the Chicago-Milwaukee market to 50. Its likely that Goodwill will see more stores opening throughout the country. Last year, H&M, Forever21 and other "fast-fashion" stores showed high revenues, will this year be the year of the thrift store?

Kraft focusing on value proposition

Kraft is turning its focus to the tight shoppers of the economy. By changing their marketing strategy and making their products more widely available to they're customers, they're hoping to seen a continuing increase in the sales of their products. It's positioning its products as affordable and focusing their marketing efforts to emphasize their value. They've also expanded to sell their products at warehouses and dollar stores, who have seen an increase in sales during the current economic recession.

Source: Chicago Sun-Times

Shoppers changing habits after food safety recalls

In a new survey released by Burson-Marsteller and Penn Schoen & Berland Associates, they say that nine out of every 10 US consumers have read or heard about the food safety recalls within the past few months. And as a result, 1/4 of consumers will change their buying habits. Those companies with strong brand awareness will more likely fare better throughout the food scare. For more information, read the article at Retailer Daily.

Questioning Microsoft's Retail Strategy

Rob Enderle of ITBusinessEdge.com contends that what makes Microsoft different is that it is not a premium vendor. Its demographic covers the full range of offerings from the very low end all the way up to the very high end in gaming PCs. Unlike Apple, its offerings are complex. The true benefit it offers is in the breadth of the offerings and the ecosystem that lies behind them. These are concepts that gave Microsoft the market advantage that resulted in dominance. But, like Apple, in most stores there simply aren't the talents available to help either explain or sell the resulting benefits or help people achieve them once they've purchased the products.

It seems the Enderle claims Microsoft has overextended itself without the proper resources to sustain this reach. Do you agree? What can Microsoft do, on the shelves, in their marketing efforts to refocus their brand and consumer shopability?

New survey on shopper habits

Penn, Schoen & Berland Associates recently released a study showing the habits of shoppers when making purchasing decisions. It shows that a lot of consumers spend a significant amount of time online researching products before they decide to make a purchasing decision. It also shows that impulse buying occurs with smaller decisions such as restaurants, books and movies. Check out the full survey here.

Dollar General to Speed Up Openings After Sales Rose

Bloomberg reports that stellar sales have lead Dollar General executives to speed up store openings around the United States. In a tough economy, Dollar General is seeing gains as shoppers look to save pennies at the grocery and home goods retailer. Wal-Mart and McDonald's have also seen a large gain in stock prices--and in profits as the United States sinks deeper into recession. According to Bloomberg, Dollar General bought by private equity firm KKR & Co. in 2007 for $7.3 billion, plans to open about 450 new stores in 2009 and remodel or relocate about 400 others. In fiscal 2008, it opened 207 new stores, relocated or remodeled 404, and closed 39, ending the year with 8,362 U.S. locations.

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MyMacys brings local taste to local stores

In a recent article at the Cincinnati Enquirer, they look at what Macy's stores in the region are doing now to better provide for their customers. Through the MyMacy's program, they're allowing local managers to make the inventory decisions, catering retail to the local taste. Macy's is hoping this will lead to an increase in local sales, which will lead to more hires in the region. The MyMacy's program will expand to all 808 stores this May.

Comfort Food Reigns in Recession

In the recent article at The Chicago Tribune, reporter Mike Hughlett tackled the issue of shopper's adherence to familiar brands and comfort food during the recession. According to Hughlett, less-expensive comfort foods and classic brands—think Kraft Macaroni and Cheese and Hormel's Spam canned meat—are doing bang-up business. White flour and dried beans are hot items as more Americans are making foods from scratch. Hughlett also relays that Americans bought considerably less fresh produce during the 13 weeks ended Nov. 1, and they increasingly stocked up on dried legumes. And they were cutting back on frozen prepared foods as well as prepared deli items.

What will this mean for the prepared food market? Will we see a continued decrease in purchased of prepared deli foods?

Another facet that we would be interested in seeing, is the growth of restaurants offering comfort food. Think how Cracker Barrel, Bob Evans and local diners are faring.

The IKEA Shopper Experience

Tim Manners from the Hub Magazine recently sat down and interviewed Bill Agee, the marketing director of IKEA U.S., in which Bill described IKEA’s key to success. An interesting concept that I took from the pdf of the interview is that the “IKEA shopper” does not just reflect a certain segment, but a very broad audience. Young families and people moving out for the first time though are segments that will always come to IKEA more easily than others. IKEA also gets its insights from shoppers by conducting proprietary research, asking questions related to the in-store experience and the home experience (living with the product.)

Take a few minutes to browse the interview as I am sure you will find it informative. Enjoy!

Read the article

Beef Checkoff launches new shopper marketing campaign

In an effort to further connect with their customers, Beef Checkoff has launched a new shopper marketing campaign that connects their television campaign with a television promotion which focuses on selling veal as a dish, not as a cut. In addition for consumers to have the opportunity to win free groceries for a year, they're highlighting the website Veal Made Easy, which teaches customers how to cook veal.

Dean H. Coklin, the Executive director for Veal Marketing, had this to say about the new campaign:
"People already love veal. But our research tells us they don't always know how to cook it. By educating the consumers about how easy it is to prepare a delicious, nutritious veal dinner in their own kitchens, veal will enter the short list of protein options for home cooks."

Source: The Cattle Network

Dollar General and Toys R Us Investor: No Bailouts

According to Reuters, Henry Kravis, CEO of Kohlberg Kravis Roberts & Co said that his company was looking for alternative investment opportunities during this rough financial climate, instead of a bailout. The Berlin based organization, who has investments in Toys R Us, Sealy, Alliance Boots and Dollar General said that there would be rough roads ahead but a "ray of sunshine" for their organization lies in the substantial level of new investment grade debt issued in the United States over the last few weeks without a government guarantee -- the first time in many months. Kravis said, "It is another indication that maybe things are starting to get better." According to Reuters, corporate debt has enjoyed an eight-week rally as investors shifted out of stocks for high-yielding corporate debt. U.S. corporate bond spreads are at their tightest levels in months.


How do you think these changes in investments will trickle down to the stores and to the shopper?

Value Your Shoppers' Time

A recent post on RetailWire.com discusses how a survey conducted by BuzzBack Market Research found that even though shoppers are shopping for bargains, they want to save time and want the buying process to be easier. Here’s a sample from the post of what consumers are searching for when they shop:

• Fifty-three percent are using the internet more frequently to research products and prices;
• Forty-six percent want to receive price comparisons, product reviews, coupons, promotions and store sales information online or via e-mail;
• Forty-nine percent are switching between retailers, 'shop hopping', to get better value;.
• Twenty-six percent are making more frequent shopping trips to take advantage of promotions;
• Twenty-one percent are shopping at stores with more flexible hours and 17 percent are increasing trips in line with pay day.

What are some examples of companies that offer their consumers product reviews, coupons, promotions, and exceptional customer service? Zappos.com comes to my mind, but what are some others?