Study reveals paradigm shift in Americans’ shopping behavior
Chicago — The new, post-recession American shopper is high maintenance, promiscuous and demands an innovative and engaging experience in-store and online. According to a new study released by Leo Burnett’s marketing services arm, Arc Worldwide.
“The recession has forever changed people’s mindset about shopping,” said Dr. Alan Treadgold, head of retail strategy at Leo Burnett Worldwide. “People have developed new rules for retailers. As a result, retailers must understand the changed role they play in people’s lives and meet their expectations to maintain customer loyalty.”
The study — “Re-Imagining The Retail Store” — identified five key findings retailers should note when implementing new strategies:
1. DON’T LET TECHNOLOGY UNDERMINE THE SHOPPING EXPERIENCE. Retailers tend to view in-store technologies as a better way to connect with their customers, but customers don’t agree. Yes, people want to experience a seamless transition between the physical and virtual store by using technology, but they also want educated and friendly service when visiting the physical store. Technology is not a suitable substitute and this practice can damage an already fragile relationship.
2. SHOPPERS ARE PROMISCUOUS. They shop around and their loyalty is hard earned. The recession has taken a toll on consumer confidence and people’s perceptions of retail business. Customer loyalty has to be earned by understanding in detail the expectations of the shopper and delivering every time.
3. PRICE GETS YOU AN INVITE TO THE PARTY, BUT NOT A VIP PASS. Consumers will not accept a trade-off — low price versus quality experience and merchandise. Today, people are more than happy not to spend if they feel that retailers do not give them a sufficient reason to purchase.
4. BREAK THE RULES. If you’re not winning by following the rules, break them. There are two clear ways to win in store-based retailing — excel within your store archetype or take a radical path to greatness and create a new store format that breaks out of category conventions and delivers a unique experience.
5. THE BASICS ARE STILL SEXY. It may not be exciting, but there is work to do and profit to be made from making the basics better. Retailers are struggling to get the basics right and people are visibly frustrated. Taking a page from “Retail 101” will help to improve customer appeal, retention and ultimately, profitability.
Click here to view the complete the study and click “download the whitepaper."
Ann Taylor profit tops estimate, upbeat on holiday
New York City — AnnTaylor Stores Corp.’s fiscal third-quarter profit rose, aided by better-than-expected sales growth. Net income surged to $24.2 million in the third quarter ended Oct. 30, compared with $2.1 million a year earlier.
Total sales rose 9.3% to $505.3 million, above analysts’ expectations of $492.8 million.
Same-store sales increased 11.7% overall, with a 21.9% rise at the Ann Taylor brand and a 4.5% less expensive Loft chain.
The company forecast total sales in the fourth quarter approaching $500 million and a mid- to high-single-digit percentage increase in comparable sales in the period, which includes the holidays.
It expects double-digit same-store sales growth at the namesake brand and low single-digit growth at Loft.
For the full fiscal year, the company expects net sales approaching $1.97 billion and positive same-store sales growth at both brands.
"While we anticipate a promotional environment in the upcoming months, we feel good about our overall business as we enter the fourth quarter," CEO Kay Krill said in a statement.
Hibett Sports 3Q comps up 12.5%, co. raises outlook
BIRMINGHAM, Ala. Hibbett Sports reported that net sales for the third quarter increased 14.8% to $167.4 million compared with $145.9 million for the 13-week period ended October 31, 2009. Comparable-store sales increased 12.5%. Net income for the third quarter increased 43.5% to $12.6 million compared with $8.8 million for the third quarter of fiscal 2010. Earnings per diluted share increased 45% to 44 cents compared with 30 cents for the third quarter of fiscal 2010.
Jeff Rosenthal, president and CEO, stated, “We are very excited about our performance over the last three quarters. Not only has Hibbett achieved three consecutive quarters of double digit comparable store sales growth, we have also experienced continued margin improvement. As a result, we are raising our earnings guidance for fiscal 2011. In addition, we are accelerating our store opening plans for this year.”
The company increased its earnings guidance for fiscal 2011 to a range of $1.63 to $1.66 per diluted share, which equates to 47 cents to 50 cents per diluted share for the fourth quarter, and a mid-single-digit increase in comparable-store sales for the fourth quarter.