Consumers Procrastinate Back-to-School Shopping

Retailers, take notes. American families are putting off their back-to-school shopping in an effort to make sure they’re getting the best deals.

Marshal Cohen, chief industry analyst with the NPD Group, told msnbc.com, “The consumer is not in any rush.”

An earnings call from Walmart indicated more shoppers are making their school supply purchases closer to their schools’ start dates. The National Retail Federation also predicted a quarter of school shoppers won’t begin their back-to-school shopping until one or two weeks before school begins. In some cases, families may even put the shopping off until later in the fall after seeing what’s in style and what students really need.

Still, the National Retail Federation predicts American families will eventually spend more on back-to-school supplies and clothes than last year. Back-to-college spending should remain about the same.

Meanwhile, retailers are offering deals for the customers now. Abercrombie & Fitch’s jeans are currently 40 percent off, Target is offering free shipping on $50 online purchases and Amazon.com has bargains on coffee makers, printers, microwaves and textbooks for college students.

Consumers Craving Gift Cards

The National Retail Federation tells us that gift cards are again finding favor with consumers who enjoy the flexibility of selecting their own merchandise at participating stores. The NRF says that gift cards are preferred by 55.2% of adults as a holiday gift. They choose this gift ahead of clothing, books, DVDs and electronics.

Christina Veiders, Managing Editor of Supermarket News, writes how retailers, realizing that the old idea still has some life, are using gift cards as not only a sensible gift idea, but also as a means of sales promotion. The technology behind gift cards takes an old idea, the gift certificate, and gives it new life because they are cheaper to produce, easier to track and provide a long lasting branding opportunity. Consumers love the convenience.

After taking a dip last year because of retail bankruptcies, gift cards are again experiencing growth. After market stabilization and some needed legislation, retailers are taking advantage of the trend for promotional purposes. Some grocery chains are offering savings on the grocery bill for the purchase of a certain value card. This makes a good tie-in to their loyalty card programs. Others are offering fuel discounts or tying using the cards as an incentive to buy certain items.

There are very few ideas in the business world that are truly win-win. For enhancing the customer experience and proving effective and efficient for retailers, the gift card seems to hit this lofty goal.

Black Friday VIPs

The general consensus is that Black Friday resulted in an increase in store traffic, but a decrease in spending per shopper for some overall mild sales gains. But the big question remains, what needs to happen to turn retail browsers into retail buyers? Some brand marketers played the shopper experience card by offering VIP treatment on the busiest shopping day of the year.

A story in the Boston Globe documented some unique approaches. Best Buy offered a limousine ride, special seating outside the store prior to opening, a private shopping tour before opening and a $1,000 gift card. All of this was for winning an essay contest.

The early results of Black Friday show that deep discounting isn’t enough to coax consumers. It also takes an equal amount of clever promotions and some good old-fashioned customer service to close the deal. According to one retail analyst, “The combination of value and service will be the great differentiator,’’ According to the National Retail Federation, sales for November and December are expected to decline 1 percent.

Some other examples of VIP treatment are free cookies, holiday tote bags, gift cards, subscriptions, limousine rides, wardrobe consultations, shopping butlers, gift-wrapping assistants, video cameras and celebrity wake-up calls. Most of these special offers and VIP contest were advertised via social networking outlets like Facebook and Twitter.

The Value of a Happy Customer

Imagine spending several hours with your child in one of those hip, trendy, music-blaring fashion stores, picking out endless layered outfits for camp, only to be told at the register that there is a cap on the number of purchases an individual can make, and, unfortunately, you’re over the limit. Or, imagine you purchased a phone several months ago and it just doesn’t work. You write, you call, you threaten to involve your lawyer and the media….and still the store won’t take the phone back because it violates store policy on the return of electronics.

The clothing store is concerned about individuals purchasing large amounts of merchandise for resale. The electronics division of the department store won’t take back anything electroinc that was purchased more than six months ago. On the surface, these policies don’t seem overly unfiar. But when store policies violate everything that seems right and fair to the customer, who’s wrong? Is it the store, for setting up seemingly inflexible, stringent policies or is it the customer for having unreasonable expectations? Complaints like these are at the core of the customer experience, and stores who make it exceedingly difficult for their customers to return unwanted items are losing those customers.

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Keeping One Step Ahead of Consumers

According to the STORES Top 100 Retailers ranking, the most successful retailers in the industry are constantly reinventing themselves to stay one step ahead of the competition. Susan Reda, Executive Editor of STORES, the official magazine of the National Retail Federation, states, “It’s not enough anymore for retailers to carry the same merchandise as their competition. From their own brand of food to an exclusive line of tools, today’s retailers will get ahead by differentiating their merchandise and offering products that consumers cannot find anywhere else.”

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