Keep Your Customers
When it comes to incentivizing customers to visit stores, less may be more, according to a September 2008
The study found that nearly half of all customers (48%) are “much more likely” compared to a year ago to shop at a store that waives the sales tax, generally a single-digit savings. By comparison, a retailer that offers storewide sales of 33% or more off regular prices garnered just 44% support, while stores that increased their selection of private-label products received the lowest support from consumers, just 16%.
The Chain Store Age/Shapiro study of New Age Buying Incentives examined 21 different incentives. They included promises of savings and service. In the difficult economic environment that consumers must now negotiate, nearly half say they are managing their household budget mainly by buying less; almost as many say they are doing so mainly by taking advantage of money-saving opportunities.
The findings of this study demonstrate what is now at stake in retail promotional programs and, more importantly, can assist retailers in designing programs that are likely to achieve a competitive edge.
The three most powerful incentives were suspension of sales tax, store-wide sales of 33% or more, and the opportunity to buy overstocks or irregulars at a low price. Aside from an indifference to more private-label products, other relatively weak incentives were trading stamps (and, by implication, point systems on travel or merchandise), e-mail coupons (as contrasted to pre-printed coupons) and a 3% discount for using a store’s charge card, implying that incentives to use credit are being resisted.
Big-ticket purchases were studied separately. Of six incentives studied, free installation was the strongest draw, at 53%. Four others had somewhat lower appeal. Among them, free delivery was strongest, followed by manufacturer rebates offered on many of the products the store sells. Interest-free financing was weaker, suggesting again that even for big-ticket items, consumers are reluctant about incurring debt.
The audience for retail advertising has surged over the past year. Consumers are depending on advertising to inform their more cautious shopping. In particular, attention to newspaper retail advertising has grown. Growth in coupon redemption is being supported by hard-copy coupons derived from newspapers as well as by direct mail.
While year-to-year growth in attention to e-mails from retailers is relatively modest, the use of retail Web sites is growing at a robust pace.
Best Buy LCD TV line to earn Energy Star label
MINNEAPOLIS Best Buy has announced that its entire line of exclusive-branded Insignia LCD televisions manufactured after Nov. 1 will meet the new ENERGY STAR version 3.0 requirements, including six Insignia models which will exceed the new specification for energy-efficient televisions by 15% or more.
All Insignia LCD televisions available at Best Buy stores across the U.S. by Dec. 31 will be ENERGY STAR 3.0 certified. For more information and an updated list of brands meet the 3.0 specification, visit www.energystar.gov/products.
Klein’s Markets joins Wakefern under ShopRite banner
KEASBEY, N.J. and FOREST HILL, Md. Klein’s Family Markets, based in Harford County, Maryland, announced that it will be joining the Wakefern Food retail cooperative. With membership in the cooperative, Klein’s will transition its seven stores to the ShopRite banner.
“Transitioning to the ShopRite banner will allow us to expand our offering throughout our store including a broader selection in our meat, produce, deli and bakery departments,” noted Marshall Klein, perishable director of Klein’s Family Markets. Marshall Klein also noted that the quality of the ShopRite private label brand was another consideration when deciding to join ShopRite. “Harford County residents will now have access to more than 3,000 ShopRite branded items, including imported specialty foods, that we believe will bring a new level of quality and value to our customers,” said Klein.
The Klein family becomes the forty-fourth member of Wakefern Food Corp. and will complete their transition to the ShopRite banner by the first quarter of 2009. In addition to providing its members with procurement, warehousing and distribution services, Wakefern is the marketing and advertising arm for ShopRite.