The winter holiday shopping season is recognized as a two-month period in which retailers can make up to 40 percent of their annual revenue. In my last post (Why Retailers Should Have Good Attitudes, Not Discounts, For The Holiday Season - Part 1), I looked at some current news articles to see if they were setting a (negative) tone that retailers and consumers would buy into for the coming holiday shopping season. I also noted the importance for retailers to use pricing intelligence and assortment intelligence solutions to be competitive and get the best prices possible in the marketplace.
Business Strategy and Marketing Expert, Bob Phibbs, the Retail Doctor® takes the issue of doom and gloom forecasts very seriously, telling retailers it's up to them to choose whether or not they will have a successful season.
First, here are some headlines and comments from 2011 and after, that illustrate Phibb's conjectures:
"…Joyless Holiday Retail Forecast … Discounts will be needed just to get shoppers into stores … Expect big Black Friday (sales), then flat-line as shoppers wait for another round of discounts later in the season … Holiday is going to be painful … Price cuts, With a promotional fall and holiday season … Christmas Spending Forecast Down from a Year Ago … Data Point to Weak Holiday Sales … Some Gains, But Stores are Worried … U.S. Consumers Fall Behind in Holiday Shopping … Early data shows that customer traffic for the full holiday season plummeted 16% and total retail sales sank 2.3% ... For U.S. retailers, the holiday season is shaping up to be merry -- though hardly jolly..."
Phibbs contends that the media proffers the same stories every year in one form or another -- and feed off of each other -- and influence the tone that follows, which can have a disastrous effect on a company's attitude, performance, and bottom line. Phibbs posits, that after some initial optimistic reports each September, retailers and consumers will begin seeing these same fear-based predictions, and go into the 2012 holiday season with a negative attitude. Phibbs believes strongly that it's time to change those patterns.
First, here's Phibb's sardonic repertoire of what happens every year to make for a dismal Holiday Season:
-- During the second week in October, headlines will announce that it will be a tough holiday shopping season for retailers this year.
-- During the third week of November, headlines will announce that retailers are nervous about the holiday shopping season.
-- After the Black Friday weekend, headlines will announce that there were not enough shoppers in the stores; that Black Friday sales were disappointing, signaling trouble for the holiday season.
-- During the first week of December, headlines will announce that retailers are nervous while shoppers are waiting on the sidelines for more bargains to appear.
-- During the week prior to Christmas, headlines will announce that shoppers are finding tremendous bargains (naturally at the expense of retailers and their bottom lines).
-- During the week after Christmas, headlines will announce that holiday sales have – once again – disappointed retailers.
Advice for 2012: Watch and see if these "predictions" come true again this year, but this time don't let these stories neutralize all potential benefits of what should be your busiest season of the year:
7 Significant Ways Retailers Can Avoid A Doom & Gloom Holiday Shopping Season:
1. Be proactive and take strategic initiatives.
2. Keep a positive attitude and message.
3. Don't give media fodder for doom and gloom stories. Release positive stories and don't let the media put words in your mouth. Don't be a target for writers looking to feature frightened retailers.
4. Convey to the consumer that there’s no need to discount—stand your ground.
5. Convey to the consumer that you have excellent merchandise.
6. Convey that you have priced it right. (Don't imply to the customer by your actions: "You’re not going to like the prices I’m asking, so I’ll give you a discount".)
7. Emphasize the quality and value of what you have to offer. Give your customers the feeling that, even if they are on limited budgets, they do not have to “settle,” when they can give luxuries.
Takeaway: Approach The Holiday Season With Positive Energy
Don't be defeated before you start. Be realistic about the economy. Tailor your retail strategies and techniques to start with a good attitude – not discounts.
The annual round of negative predictions neither sells merchandise nor inspires optimism in retailers or shoppers. Instead, these stories encourage a large group of consumers to hold back and wait for deeply-discounted bargains, as well as creating a group of retailers who expect the worst -- and cut prices -- thus limiting their profit potential during the most important season of the year.
Use pricing and assortment intelligence to have the full picture of the marketplace. The sooner you start using pricing and assortment intelligence, the sooner you'll have a picture of the competitive landscape -- you'll be able to see and plot the trends -- and be at your most profitable price points -- year-round!
What would you do to set a positive tone for the holiday season? Thanks. Gilon