Recent economic woes have caused shoppers to be less impulsive, less loyal and more likely to shop within their means. Two retail executives shared advice on how retailers can maximize sales with this new type of consumer.
A Retail Solutions article by editor-in-chief Matt Pillar talked with Bjoern Petersen, president and general manager of the retail industry group for HP Enterprise Services, and Dianna McHenry, director of the global retail practice at SAS institute, about these trends, and they shared some advice for retailers.
When it comes to dealing with the needs-based consumer who is less impulsive, Petersen advises retailers to try selling different products to see which will beat the competition. He also said retailers should experiment with different prices to see what the changed consumer is willing to pay.
Consumers now may be more focused on price than loyalty, said McHenry. To maximize sales, she said retailers should use market research data to determine price, markdown and promotion optimization. Petersen said this focus on price has been fueled by mobile commerce, or m-commerce as he called it, and retailers should promote via shoppers’ mobile devices.
They also discussed the demise of the "aspirational" shopper who spends more than he or she really should based on income on specific brands. Petersen suggested retailers make incremental adjustments to their merchandise mixes to retain or win back the folks who like to "shop up." Instead of offering the highest price-point luxury item, he suggested offering second-tier items. McHenry said this strategy offers opportunity to great private label products.