From the President

SOARING GAS PRICES GUARANTEE A DISASTROUS HOLIDAY SEASON FOR RETAILERS

– Don Capman

Doesn’t a headline like that just drive you crazy? It does for me. Each year, right before the holiday season begins, the media plays up “gloom and doom” for the retail industry. Don’t these jokers have anything better to talk about? We spend huge amounts of advertising dollars throughout the year with the same media that does everything in their power to put another nail in our coffins. What’s wrong with this picture?

Some years the media blames high unemployment for the disaster; other years the problem is the lack of snow or cold winter weather to get buyers “in the spirit;” this year it will be the high gas prices and the lack of discretionary income. Have you ever heard of a self-fulfilling prophecy? It basically means that if you say something long enough, eventually you cause people to believe it, and it actually comes true. With the constant bombardment of retail “gloom and doom,” consumers get scared and buying habits do change.

So what’s your strategy? If you think that writing a letter to the editor will change the way the media does its dirty business, think again. Although we don’t like to hear it, there is an element of truth in what the media reports. For example, many consumers will not buy anything that isn’t on sale, so holiday sales now start in October instead of late November and cut into profits. In reality, the weather does affect buying patterns. And, discretionary income will be down because of high gas prices at the pump. Well, if you think there is nothing that you can do to have a profitable and fun holiday season, then you might as well stop reading this article now and close your doors today. It’s not worth the aggravation. But for those of you that are eternal optimists, read on.

All or some of the negative events that influence buying habits may, and probably will, happen to some degree again this year. The media has already begun talking about the lack of discretionary income and its effect on buying power. You know, they’re probably right. So where does that leave us? The question is: “How do I get the buyer to spend that discretionary income in my store?” Barring a catastrophic event like 9/11, the public still spends money during the holidays. They might have less of it, but they still have it and want to give gifts. So if I want the public to spend their money in my store, what can I do?

• Start making a plan now. Don’t wait another minute. Retailers who go into the holiday season without a clear plan, come out of the holidays as victims of the self- fulfilling prophecy and have no one to blame but themselves. Write the plan down with timelines. What are some ideas that can make up a successful strategy?
• Start a direct mail campaign. Mail several well-planned postcards to your best customers telling them about new products. Send them once a month. Postcards are an inexpensive way of keeping you in front of buyers.
• Do you have your customers’ e-mail addresses? Send them an e-mail about a new product or an event you are having. Be cautious not to SPAM your customers. When they give you their e-mail address make sure they are opting in to receive e-mails from you.
• Send out a newsletter to your customers. Tell them about what’s going on in your store. Perhaps one of your employees got married or had a baby. Humanize your store. People love human interest stories. In the newsletter, show your new products and give people helpful hints. You might also want to include a date- sensitive coupon in the newsletter.
• Host or sponsor a charity fundraiser. People will perceive your store in a totally new light. Pick a charity that is “near and dear” to your community. You’ll not only be helping out people in need but will be creating a “feel- good” impression of your store.
• Have a series of events throughout the fall leading up to the holidays. You could have vendors come in and demonstrate their products; have fashion shows using some of your customers as models; have free classes using products you sell; have a private sale night with wine and cheese for preferred customers. Give a discount to a preferred customer who brings in a friend. There are a million things you can do if you just think about it.
• Involve your employees in coming up with ideas. Offer a prize for the best idea. It is critical that your employees “buy-in” to the program to make it as successful as possible.

Most of the strategies discussed above are much less expensive than traditional media and can be far more effective. The traditional media is not helping us out; why throw our profits down the toilet by helping them out? Make sense?

When designing a plan, don’t focus on just one of the suggestions mentioned above, but choose a variety of approaches. Just make sure you clearly outline your strategy on a spreadsheet, make sure they are doable, and stick to the program.

Last, but not least, BE PROFITABLE AND HAVE FUN DOING IT! If anyone would like to brainstorm a strategy, I would be more than happy to speak with you about the plan for your store. Feel free to call or e-mail me personally.