Retailers should enjoy the best Christmas season in years, thanks to a robust economy, low unemployment and high consumer confidence. Even so, shoppers will be watching prices closely, due to the high-profile closings of many stores.
Savvy merchants will come up with attractive price points and compelling sales messages, because
Before ringing too many holiday bells, though, retailers need to realize that shoppers will be bargain-hunting. “The nation has been experiencing many high-profile store closings,” says Phibbs. As a result, consumers will be expecting retailers to reduce prices. [quotesright] “It’s going to be harder to communicate compelling messages beyond discounting.” [quotesright]
Just as challenging as a product supply glut is a rapid growth of ecommerce at the expense of brick-and-mortar stores. Aggressive promotions by online retailers will put more downward pressure on prices. “Retailers are going to have to come up with promotions that shoppers can’t get on the web or from Amazon,” says Dave Ratner, a speaker and consultant on retailing based in Agawam, Massachusetts. (daveratner.com).
Package deals trim prices, boost total profit
Ratner likens this approach to that of package deals in the travel industry and the “luxury” offerings of car dealers. You also might offer discounts for the purchase of two or more items of the same kind. Because this increases rather than trims revenues, it’s a much wiser move than offering discounts on a per-item basis.
Target key shoppers
One of the best ways to do that is the use of social media. Ratner points specifically to Facebook, where retailers can send messages to groups of people identified by age, occupation, and even location. “You can buy Facebook ads that target people within five miles of your store, to various occupations, hobbies and genders,” he says. “And the costs are so much less than the old days of print ads and mailers.”
And speaking of targets, how about aiming at local organizations that can do your marketing for you – or at least help substantially? “Make deals with your local schools, churches or other organizations,” says Ratner. “Do promotions that will appeal to their members, and give the organizations a cut of the sales. They will end up promoting your merchandise for a share of the profits.”
Dress for success
Employee training, of course, is equally vital.
Personnel make up half the battle. The other half is the creation of a sparkling, festive store environment. People love to shop in a happy place.
Decorate with festive banners, garlands, and evergreen branches. Add pine aroma and quiet, tasteful holiday music. Replace your light bulbs and make sure the whole place is well lit.
Interactive signage throughout the store can be effective in directing shoppers to holiday merchandise, says Meyer. “Emphasize suggestive selling and promotions as people pass by the screens.”
Nail the sale
Once they get to the checkout, customers will be open to one final sale. That can make the difference between profit and loss for your store. “Promote an item at the checkout, selling for under $10, that is an easy impulse item for people to pick up,” says Phibbs. “Make it something people don’t have to think about. Add a compelling sign that says something like ‘The gift you forgot.’”
How about your own store? The ideas in this article will help you put in place some profit-boosting ideas to catch the public eye. For more tips see the sidebar, “Stocking Stuffers for More Sales,” and pick the ones that look right for you.
If you develop a compelling sales message, trim your prices, and promote package sales to targeted shoppers, the result will be a profitable Christmas season. “You have to know your customer, communicate why people should leave their houses and come to your store, and really focus on those four walls to create an exceptional experience,” says Phibbs.
That takes a lot of work. But what other choice do you have?