volume 19 issue 01 • 2011

VOLUME 19 ISSUE 01 • 2011
TIME TO EXHALE?
SORT OF...
1
THE RECESSION IS NOT OVER
2
NEW SHOPPER PLAYBOOK
3
FIRST SHOPPERS
4
BUT SHOPPERS MOVE ON
EMERGES
TO COME BACK
LESSONS LEARNED;
INSPIRATIONS OBSERVED
WHO WOULD HAVE
IMAGINED IT?
HAPPY EVERYTHING
5
6
7
TIME TO EXHALE?
SORT OF….
We made it through the 2010 holiday shopping season in relatively good shape. People
shopped (albeit with lists and lots of coupons
in hand). Inventory was turned. Discounts
were abundant but planned so retailers didn’t
give away the store. In the end, it was a season for most retailers to be satisfied – especially luxury retailers, deep discounters, food
and online retailers.
Is this a sign that our consumer-led economy
is back on track? A sign that Americans will
now spend consistently rather than their roller coaster behavior of last year? A sign we
can now exhale and move on? The answers:
Sort of, no and yes…
THE RECESSION IS NOT OVER
BUT SHOPPERS MOVE ON
In our new study How America Shops®
FUTURE SHOP 2011-2012-2013 published in
December, shoppers were resoundingly clear:
two-thirds said the recession (their recession)
would last three or more years. Half said their
personal finances would take at least one to
three more years to improve, while four out
of 10 said they had no idea when. Certainly
doesn’t sound as if we can exhale any time
soon. And yet…
…Shoppers are moving on. In fact, let’s erase
“recession” from our vocabulary because
shoppers have accepted the new reality of
their lives and are moving forward – and fast.
They’re utilizing all the lessons they learned
in the last three years to shop smarter.
1
This past holiday season showed how they’re
doing it. They made lists, checked prices be© WSL MARKETING INC. 2011
fore they shopped, used the Internet as both
shopping tool (for information and discounts)
and shopping place, spent within their means
so they wouldn’t get into debt again, bought
mostly what they needed, and a little of what
they wanted.
And that’s exactly what we can expect from
them in the year to come.
NEW SHOPPER PLAYBOOK
EMERGES
Their shopper playbook is clearly defined:
72% n ow pay more attention to price on just
about everything they buy
64% look online for the best prices and
discounts before going to stores
61% m
ake shopping lists to avoid
overspending
60% s tick to brands and stores they can
afford for most things they buy
57% u se more coupons now than they did a
few years ago, and
54% are willing to try products that cost less
Source: How America Shops® Future Shop 2011, 2012,
2013, December, 2010
For every company, retailer or manufacturer,
in any category, future success will be based
on the following:
1.Substantiating the value of everything
you offer shoppers
2.Creating ways to be part of the shoppers’
savings culture
3.Developing ways to get on their shopping
list -- for needs and wants
4.Validating why you are worth the price
and the trip
5.Using the Internet and digital tools to provide information, service and shopping
opportunities -- every day
VOLUME 19 ISSUE 01 • 2011
6.Recognizing shoppers are in control, and
rewarding them for that, especially Mom
WENDY LIEBMANN | CEO
will speak at:
01.25.2011 FMI MIDWINTER
EXECUTIVE
CONFERENCE
LOCATION:
The Arizona Biltmore
Phoenix, AZ
02.06.2011 NACDS REGIONAL
CHAIN CONFERENCE
LOCATION:
The Ritz-Carlton Naples
Naples, FL
Lanvin and H&M collaboration
FIRST SHOPPERS
TO COME BACK
A positive sign is the (slowly) improving optimism of three traditional economic optimists,
Men, Young and Affluent, plus the growing
confidence of Minority shoppers.
Men are more confident about their finances: 46% say their finances have already
improved or will within a year compared to
34% of women. (Did they forget to tell their
spouses?)
Younger shoppers are no longer as worried,
even if they still can’t find a job: 54% of
Millennials (18-34 year olds) expect their finances will improve within a year compared
to Boomers and Seniors who remain very concerned about their future.
No surprise, higher income shoppers are
more confident about their financial future
than middle and lower income. Hence, they
shopped with gusto over the holidays and will
continue to lead the way in 2011 -- but with
restraint. Even they don’t want to get into
debt again. Even they recognize a good deal.
Even they want to be smart shoppers.
The real surprise is African American and Hispanic shoppers. Over half say their finances
will improve within the year compared to only
34% of Caucasians. Not because they are
more confident about the economy but because they have paid down their debt. They
feel more in control of their finances and so
are willing to spend again, albeit cautiously.
The key is to keep these shoppers spending
even as unemployment remains high and gas
prices rise.
LESSONS LEARNED;
INSPIRATIONS OBSERVED
Ugg & Jimmy Choo
collaboration
2
© WSL MARKETING INC. 2011
As we begin the year, we enjoy the luxury of
looking back to go forward. In October, in
The EDGE, we offered some first thoughts on
what “forward” looked like. We noted a new
FLAT retail world and how it is fast changing
the retail landscape.
“Consider how people shop today. They
no longer shop vertically -- trading up and
down by brand or retail format based on
their income or experience. Now, they
shop horizontally.
The recession and technology have fueled
a FLAT retail world where shoppers have
total (horizontal) access to search out new
places to buy, new ways to save, and new
information to ensure they don’t make mistakes when they spend their hard-earned
money.
There are 3 layers to this FLAT retail world.
On the surface, shoppers skim across all
formats, options, brands, in their quest for
the smarter buy. Floating above the surface
is a technology cloud: a parallel world (the
Internet, WiFi) that provides access to all,
any time, anywhere (e.g., a smart phone
used in-store to check prices, obtain information about a product, that drives the
decision to buy or not, on the spot, in the
aisle). Hovering below the surface, there’s
the third layer: the social shopping world
where consumers talk, listen, share, opine
and take control of brands, stores, what
they buy, from whom, or not.”
Fashion, Beauty and Food are categories
where this new FLAT world is already most
pronounced. Inexpensive “fast fashion” retailers, such as H&M, Forever 21, Zara, Top
Shop, continue to force traditional fashion
retailers (department and high-end specialty
stores, and popular-priced chains like GAP,
Ann Taylor, Talbots) to innovate more and
faster, and reassess their value proposition.
High-end brands are learning to compete by
going more mass. One strategy is alliances
that enable a brand to gain broader reach,
e.g., Lanvin’s recent collection for H&M and
Jimmy Choo (of sky-high heel fame) with UGG
(the Australian footwear brand).
Pure play online fashion retailers such as
Net-A-Porter, Google’s boutiques.com and
Zappos are transforming the service experi-
And homewares big box Bed Bath & Beyond
is testing a L’Oréal Beauty Boutique in one
of its NYC stores. And so it goes – FLAT and
beautiful.
Consider how FLAT the Beauty world is now.
Retailers of every type, including Payless
Shoe Source, now offer beauty products, or
plan to.
In last month’s issue of The EDGE, we noted
how Food had become a shining star in the
FLAT retail world, and gave you examples
of how it was being presented to great effect beyond everyday need to drive everyday
wants. We’ve added one more retailer to our
list of food innovators this month.
ence, forcing traditional retailers to quickly
improve their online and in-store experience.
Talk about FLAT Beauty: Sephora, the specialty retailer, has become the incubator of
beauty, chaperoning such brands as Tarina
Tarintino and Tokidoki to success. It has
added a spectacular new store-wthin-a-store
concept for MAKE UP FOR EVER in select
Sephora stores. It provides JC Penney with
beauty “cred” with Sephora Inside JC Penney. And it revolutionized beauty shopping
with Sephora.com, one of the best and most
shopped beauty stores – brick or virtual.
Make Up For Ever in Sephora
Prestige retailers have finally recognized the
FLAT beauty world. Bloomingdale’s led the
way, redesigning its beauty department, added more affordable brands, emphasized hair
(Bumble and bumble), and created more self
service (Clinique offers shopping baskets so
you can shop as in a drug store). Macy’s has
added assisted self-service Impulse Beauty departments featuring more affordable
brands in select stores. UK Selfridges and
France’s Galeries Lafayette reinvented their
beauty floors with designer dazzle as well as
more popular-priced brands and services.
Mid-tier department store Kohl’s just announced it would add a new cosmetics line
from designer Vera Wang to compliment the
retailer’s exclusive Simply Vera fashion line.
France’s Carrefour, the world’s second largest
retailer after Walmart, recently opened a new
concept called Carrefour Planet with a stunning upgrade of its food (and beauty) offer.
Beyond its usual mouth-watering fresh produce, seafood, meat, cheeses, wines, it now
includes an expanded “Le Bio,” organic and
natural products, an alliance with Picard, the
French frozen food company (yes, the French
do eat frozen entrées), and more. It has enhanced its broad hypermarket presentation,
created a better, more shoppable experience,
and continues to emphasize its big
box value message.
The next category to be flattened will
be Health. It’s ripe for it. The economics and politics of health means
more Americans will soon have health
care coverage, and more will have to
take care of their health and that of
older family members. As a result,
more companies will see the potential
to innovate in this space.
As global retail strategists and
shopping futurists, we at
WSL/STRATEGIC RETAIL are
recognized for our ability to
turn shopper insights into smart
actionable strategies.
Since 1989, in our HOW AMERICA
SHOPS® studies, we have tracked the
mindset, attitudes and behaviors that
shape shopper trends, successfully
predicting how they transform brands
and retailers throughout the US.
Check out our database at...
www.wslstrategicretail.com
For more info, contact us at:
PHONE
212.924.7780
FAX
212.924.7608
EMAIL
[email protected]
Carrefour Planet Organic & Natural and Beauty department
Already we’re seeing it. Insurance
companies, such as Empire Blue Cross
& Blue Shield of Florida, are opening
health clinics, regional drug chains, like North
Carolina’s Kerr Drug, Canada’s Rexall, and independent drug stores are expanding health
services, specialty retailers, such as Max
Wellness, are adopting a holistic approach
to wellness, and food retailers like Wegmans
have broken down the walls between grocery
and pharmacy offering healthy food right in
the pharmacy.
No part of this publication may be
reproduced without written permission
from the publisher.
© WSL MARKETING INC. 2011
3
VOLUME 19 ISSUE 01 • 2011
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CONTRIBUTORS
Wendy Liebmann
KC Chung
Kimberly Charles
Candace Corlett
Randi Fater
Melissa Krantz
Paul Menichelli
Elizabeth Neagle
Shilpa Rosenberry
Peter Silsbee
Peggy Wang
We have lots of tools, research,
shopper insights to help you.
Drop by to find out more...
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© WSL MARKETING INC. 2011
Chain drug stores, long the domain of all
things health, are now being assailed by the
most obvious (mass merchandisers) and the
least (all of the above). And shoppers will
drive it all.
lowers -- and the leverage to do it at a great
price. Smart...and FLAT.
Welcome to the FLAT world. Are you ready?
Our heartfelt thanks to clients and friends for
helping make 2010 our best year ever. We
wish you the best of everything in the coming
year. One last thought from Vogue magazine’s Lynn Yaeger. She’s writing about fashion but her thoughts are relevant to all of us.
WHO WOULD HAVE
IMAGINED IT?
If you still doubt we are moving into new retail waters, consider…
American Airlines sent a holiday thank you
card to customers. An airline saying, “Thank
you”… what next?
Gilt, the online sale site, offered three 2011
Jetta cars for $5,995, way below the retail
price. All proceeds were donated to Dress for
Success, the not-for-profit organization that
provides business attire to low-income women entering the workforce. Talk about 2011
relevance – the confluence of a new retail format offering a great deal for the better good.
The New York Times and Zagats (the restaurant review guide) are selling wine to the
newspaper’s readers. They have created a
wine club where members buy wines from
around the world at great discounts. The
companies recognized they had the credibility
to sell this non-endemic category to their fol-
Do you know where your shoppers are?
HAPPY EVERYTHING
“The recession…changed the way people
think about getting and spending… Women are increasingly unembarrassed, even
proud, of how they mix inexpensive finds
with luxury items…
For a global brand to stay relevant, it has
to be open to all kinds of adventures… a
real desire to become involved in a wider
retail world, be it through online shopping,
or live-streaming runway shows or collaborating with lower-end chains…”
We wish you “all kinds of adventures” in
2011.
See you from The EDGE,
NEW REPORT FROM WSL/STRATEGIC RETAIL
• Internet Survey, National sample of 1500 adults
• Analyzed by Gender, Generation, Income Group, Ethnicity
• 21 Channels | 44 Leading Indicator Categories
• Analytic Cells & Workshops also available
For more information,
please contact us at [email protected] or 212.924.7780