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The Millennial generation - now ages 17 through 34 - represents nearly a quarter of the U.S. population, and a significant portion of annual consumer spending.
We recently read of a study that has identified a set of attributes "that overwhelmingly resonate with this age bracket." In fact, when making shopping decisions, Millennials are 20% more likely than other generations to consider these elements.
As these studies so often do, an acronym has been created to help us remember those attributes: L-A-T-T-E.
- Local
- Authentic
- Transparent
- Traceable
- Ethical.
While each of these attributes provides the means to differentiate your stores, in our view, many independent retailers can leverage ALL of them!
Moreover, in our opinion, these L-A-T-T-E qualities not only resonate with Millennials, but with many others (your customers? your neighbors? You?) who share these same values.
- It is not just demographics (quantitative data); it's also psychographics (qualitative data). And the L-A-T-T-E attributes certainly point to qualitative measures.
We think this offers two significant opportunities for independent and local retailers.
With the L-A-T-T-E attributes, independents are uniquely positioned to take the lead, and make it known that Local - Authentic - Traceable - Transparent - Ethical have long been in your DNA.
Especially in today's environment, winning the hearts and minds of shoppers is the challenge confronting all retailers. Sharing your love for L-A-T-T-E is an important step!
One of Retailing’s Hottest Trends: Selling Experiences
“After years of choosing the speed and wide selection offered by big-box retailers such as Home Depot or online merchants like Amazon.com, customers are demanding higher engagement if they’re going to buy something in a store,” reports Lindsey Rupp of BloombergBusinessweek.* Stores must be “exciting destinations rather than places to make a quick purchase.”
Some brands or chains, Rupp reports, already are selling experiences along with their goods. Consider:
- Lululemon Athletica offers yoga classes in its stores
- Apple holds in-store digital art and video workshops
- Some Cabela’s (outdoor outfitters) stores have indoor archery ranges
- PetSmart opened its first Pet Spa store, focused on the “pet lifestyle experience” for pets and their pet owners
- Teen retailer Urban Outfitters last year bought a pizza chain
Beyond "Product Demos"
In our view, each of these examples goes well beyond the merchandise, and focuses on actively engaging the customer.
- These experiences are not “product demos”. Instead, they showcase and celebrate using and enjoying the merchandise.
- Plus, customers engage not only with “experts” who use the products (those leading the sessions), they engage with other customers (people like themselves?) who also use the products.
In other words, compelling reasons to come to your store! Hands-on participation and involvement are essential for today's customers. So, what are you waiting for?
- Specialty retailers are well-positioned to deliver these in-store experiences. You have the product knowledge, the love of the merchandise, the respect for your customers.
- And what a great way to energize your staff! Ask for their ideas, and try them all! Test different times of the week: What appeals during a weekday? How about weekends? Or evenings?
For retailers, synergism and involvement is the new competitive edge.
* Pizza, Parks, and Pet Spas: Shoppers Will Pay More for Retail Experiences. Lindsey Rupp, BloombergBusinessweek, October 19, 2016.
Who goes to the grocery store to buy, well, groceries? What we want is DINNER!
But, can you go into a grocery and find “dinner”? Or “breakfast”? Or, “great lunches”? Not very easily.
- Instead, there is a produce section. And then a canned goods section. And then the frozen foods section. All with an overwhelming assortment of choices, whether it is mustards or pickles or pasta or….
- Plus, it takes a lot of time to navigate all the aisles, avoid the other shoppers and carts, and then check out. Which may be fine for those who do grocery shopping for the social experience as well as getting their groceries. But for many time pressed folks...
That's why the true disruptions in the grocery industry aren't coming from smaller format stores, or even grocery delivery services. Instead, the meal-in-a-kit services – e.g., Blue Apron, Plated, HelloFresh – are far more disruptive.
Why? They solve the real problems of many customers.
- Here's how: Folks sign up online; they receive a special icebox on their doorstep containing the fresh, raw ingredients for 3 to 5 meals, all in the proper proportions (whether 3 tablespoons of cooking wine or 1 carrot, there is no wasted food or languishing jars of spices); step-by-step instructions (with pictures) are included; customers do the assembly and cooking, and in 35 minutes or so, sit down to a home-cooked meal.
All without the time-consuming demands of meal planning or traditional “grocery shopping." No fuss, no muss, no waste.
- Remember, “value” for customers is "benefits received for the burdens endured." In our view, these meal-kit delivery services are delivering great burden-reducing value to their customers! And, they are reinventing (or "disrupting") the grocery industry in the process.
Time to think beyond Amazon?
We believe this offers, ahem, much food for thought for all retailers. As you consider how to serve your customers better and stay ahead of competitive pressures, it's time to think like your problem-solving customers.
- What problems are they trying to solve?
- Anything keeping them from getting those solutions from your stores?
- And in today's "new normal", who IS solving your customers' most important concerns – and maybe stealing their hearts and minds as well? (Hint: as grocers are finding out, it may not be Amazon!)
October 1 marks the beginning of the 4th quarter of the calendar year. The beginning of the home stretch. And yes, there is good reason for retailers to cheer. Consider:
Halloween will be HUGE
According to the National Retail Federation, Halloween spending is expected to reach a record high of $8.4 Billion on costumes, decorations and candy.
- More than two-thirds of Americans plan to buy costumes this year. For themselves, their kids, or their pets!
- This year’s most coveted costume? As reported by the Washington Post, “So far, it’s superheroes across the board: For kids, for adults, for pets,” said Lorenzo Caltagirone, owner of Total Fright, a year-round costume shop in Arlington, VA.
- After 11 years of being the most popular choice, princess costumes have been dethroned. “The female superhero in particular has really taken off. This is the year of girl power.”
- Political costumes rank third on the list of popular options for adults 35 and older, bested only by more traditional witch and pirate get-ups.
- About those costumes for pets? Pumpkins, hot dogs, and bumblebees.
The Election will be OVER!
And so will the election angst.
- According to CNBC News, “If history is any indication, retailers could see a double-digit sales lift in November and December, as shoppers focus on the holidays and release pent-up demand.”
- This post-election sales spike is likely to occur no matter which candidate wins.
- According to analysis by Alix Partners, “in the 2004 and 2012 presidential election years, year-over-year sales growth slowed an average of 22 percent in September and October, as compared with the prior eight months. It then bounced back an average 16 percent in November and December.”
Despite the Hanjin Shipping bankruptcy, merchandise WILL be in stores for holiday
- According to the National Retail Federation, “import cargo volume at the nation’s major retail container ports should be at near-peak levels for September.” While much merchandise is still in limbo, “retailers are working hard to make sure it ends up on store shelves in time for the holidays.”
What Black Friday surprises this year? How About The NEW Normal?
- Remember last Thanksgiving? Some retailers stepped back from opening on Thanksgiving Day. REI made news by closing its stores on Thursday and Friday.
- How does all that affect customer expectations for this year?
- And what approach are you planning for your stores for this year?
Not easy questions. But a sure sign that retailers may indeed be able to get back to The NEW Normal.
Ahh Yes, Christmas
This year, Christmas Day falls on a Sunday.
- That means offices that typically shut down starting at mid-day on Christmas Eve may instead be doing that on Friday the 23rd, inviting a late shoppers bonanza.
- Of course, the After-Christmas events will then start on a Monday. How convenient!
Wow, what gifts!
Especially in retail, timing IS everything. Enjoy the arrival of this year's 4th quarter.
Question: "We must keep bringing in new items. But, how do we keep from being over-bought?"
Answer: "Very carefully!"
Ahh, the appeal of new items. Or, your customer's ever-growing "wish list" items. But, when you are also trying to control inventory, and keep turns up, the challenge is, "Really, which should you buy?"
- As many retailers are only too aware, if you are not vigilant, you may experience bloated inventories, which can cascade very quickly into cash flow problems.
Here are 6 key questions for you and your buyers to ask yourselves as you consider new items. We think of it as an "entry exam" for merchandise. It's a very quick way to identify which items actually deserve to be in your store.
#1. Can my customers get this item at other stores in my market area?
If yes, it probably has no pulling power.
#2. Is this a good margin item, or is it subject to a lot of price competition?
Slow turners with weak margins are double trouble.
#3. Does having this item in stock help me sell other higher-margin merchandise?
If not, you may not need it.
#4. Can I get faster delivery on this item than I am now getting?
If yes, you may be able to cut back on your stock.
#5. Do I order larger quantities of this item than I actually need in order to take advantage of price breaks?
If yes, you may be coming out on the short end when you figure in all your carrying costs.
#6 Do I have an emotional attachment to this item that reflects my personal taste rather than a business-like response to my customer’s desires?
If yes, get rid of it!
Go here in the Library for Owners at The Retail Owners Institute(R) for more useful and practical insights and tactics about protecting your store from inventory bloat. See how quickly you can achieve greater control of your inventory!
New items? Oh my, yes.
Too much or too many? Not any more!
