Success Strategy

The results of the past few months remind me of the old Wall Street axiom, “It’s a market of stocks, not a stock market.” This also appears to be true in the retail industry. In spite of the financial media’s efforts to overlay the entire industry with a “gloom blanket,” the reality is many retailers are thriving. Even government data indicates only a modestly declining positive trend in general merchandise sales.

The primary trends are company-specific and nominally a reflection of global factors. During my recent visits to dozens of retail stores, it was quite evident that some retailers planned for success with exciting and timely merchandise assortments.

Unfortunately, a large number of retailers are presenting a weak assortment of ordinary-looking, poor-quality merchandise, supported by over-promotion to simulate value. This group incorrectly believes the consumer cannot recognize the difference. To further prove the point, look at the disparity in the 90-day comp-store-sales performance of these retailers, who serve similar consumers in a similar way.

What is clear is that there is no consistent trend that applies to all retailers as an industry. Whether the economy is good or bad, it’s the individual retailer’s customer-relevant strategy and the quality of the execution that appears to determine the trends.

Starting next month, we will be adding an exciting new feature to the Retail Trending Report called the Retail Trend Tracker. This new report will utilize Internet-based consumer research to track the shopping behavior of consumers at 14 national retailers. In addition to tracking the changes in behavior, we will also report on the factors causing the consumer’s behavior to change.