Getting the retail store ready for the holiday season

5 B 1109 AqGet ready, retailers: Here comes the most important holiday season in memory. While Christmas sales are critical to success every year, this time around everyone's looking for some really festive revenues to help make up for a difficult 2009.

Given the current unemployment levels and the pullback in consumer spending, of course, no one is expecting a door-busting bonanza. Even so, signs point to a rebound.

"This holiday season should be better than last year's because the consumer is in a more optimistic mood and retail inventories are not as high," says James Dion, president of Dionco, a Chicago-based retail consulting firm. "This will be the year that gets consumers back to spending at reasonable prices again."

New Items

How can you sell more this Christmas? Here's a tip from Tom Shay, a retail consultant in St. Petersburg, Fla.: Watch where the big box stores have trimmed inventories and beef up your own selections to fill the gaps.

"Mass merchants have been engaging in line reviews in response to the economy," says Shay. "You may find that they are cutting back on some brands of certain items or even eliminating whole categories of merchandise."

Therein lies opportunity. "Customers who suddenly cannot find the items they want will look somewhere else," says Shay. "You need to be able to reach out and bring in those customers." Moreover, you can now get higher margins on those items that are not being sold at the big box stores.

You can discover what plans your local big boxers have by watching what goes on clearance and by engaging with their salespeople.

One more thing: Look for new, exciting items. "Find something new, cool and amazing and tell the customer about it," says Dion. "The original meaning of 'promotion' was just that: telling the customer about something new. We have gotten lazy about doing that. There are great, new innovative products around, so talk with your vendors."

Promote Business

Having the right goods on the shelf is one thing. Stimulating the public to visit your store is another.

"You really have to do something different, and it doesn't matter what it is as long as you don't give away the store," says Dion. "There are all kinds of gimmicks. Some retailers host 'pop the balloon' contests where each balloon holds a slip of paper with a specific percentage discount. But the customer can't pop the balloon until after they have made a purchase. Most of the balloons contain 10-percent-off slips, but there are 20 percent, 50 percent and even a few 90 percent slips."

Dion suggests using a "door crasher" item to generate footsteps. "Maybe you promote one item for a ridiculously low price, but everything else is regular price. The loss leader will get the customers in the door, then your job is to sell them your regular-price products."

Bottom line: Do more than cut price. "The refuge of the lazy retailer is the 20-percent-off promotion for a category or the whole shop," says Dion. "I have seen so many stores make that mistake. The customer buys the best 20 percent and leaves everything else." You can avoid a discount image by offering a "buy three get the fourth one free" promotion. That's the same as a 25 percent discount but your store benefits from a volume purchase.

Help your customers make great buying decisions with these ideas:

  • Impulse items. Set up displays of "stocking stuffers." These are small little gift items that can make the holidays come alive. Display them next to your checkouts for impulse sales.
  • Last-minute items. Many people wait until the 11th hour to shop. Mount a display of items that cater to these people in your store window.
  • Instant presents. Do your customers' work for them and wrap some items.
  • One-day events. Hold 24-hour sales events with special pricing for an hour or during selected hours of the event.

Reward Shoppers

"Focus most of your effort at those customers who already know and have done business with you in the past," says George Whalin, president of Retail Management Consultants, Carlsbad, Calif. "Using direct mail and e-mail you can hold evening special sales events for loyal customers by offering special pricing, drawings, free gift wrapping and special merchandise just for the event. Some retailers hold these targeted events for unique groups of customers like men, women or people who buy specific kinds of merchandise from the store."

Your regulars might also appreciate a series of one-day promotions during the holiday season, according to Whalin. "The promotions can be on weekdays to increase traffic on those days," he says. "They can also be held on Saturdays or Sundays to get the maximum amount of traffic. Consider featuring a single category or item on sale each day of the holiday season. These are designed to create a sense of urgency for customers to take advantage of the special pricing on that day."

Promote your new or sale items to your database of existing customers. Keep building your mailing list by emphasizing customer benefits. Rather than ask, "Do you want to be on our mailing list?" sell the idea by telling them your list can inform the customer of valuable new product lines or special sales.

"Maximize the value of your retail loyalty rewards program as a drive for more store traffic," suggests Al Meyers, senior vice president at Retail Forward, a consultancy based in Columbus, Ohio. "This tactic was very successful last year when retailers promoted double or even triple rewards points during the peak holiday season. We expect to see more of that this year."

Small stores can be as successful as larger chains with such programs, which don't require fancy technology, notes Meyers. "Many smaller operators have business-card-sized cards which are punched every time a customer comes to the store," he says. "These programs are low-cost ways to get customers to come back more frequently."

Stay The Course

Be patient. Don't run deep discount sales the second week in November or the first week in December, believing the consumer is done shopping. That's not the case.

"Don't panic if consumers are late starters," says Dion. "It used to be that Black Friday was the biggest sales day. That's not been true for the last five years. Customers are delaying their shopping. They have started coming in the first week of December, and every year it is a couple of days later. And the Saturday prior to Christmas is the biggest day."

When customers do come in, treat them well. "The effectiveness of your holiday promotions can be hurt if you don't have sufficient staff on hand to handle customer traffic," says Whalin. "Be sure the staff knows exactly what merchandise is being promoted. Nothing will turn off a customer more than store associates who don't know what merchandise is being promoted, where it's located in the store and the characteristics of the merchandise."

Train your staff to interact in a friendly, helpful way with customers. Communicate real excitement about the most innovative items on your shelves. Explain how they can make your customers' lives happier.

"If you can find the emotional tie you can make the sale," says Shay. "People buy with emotion and justify with logic."

Comments or thoughts on this article? Please e-mail [email protected].

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