AMERICA’S RETAILERS FACE GRIM 2009 AFTER CHRISTMAS TRAIN WRECK
The nation's retail community is still in shock about the dismal Christmas, 2008 shopping season. The busiest buying season of the year was a bust for practically all retail categories and left many major chains struggling just to keep their doors open.
Discount stores like Wal-Mart, and Target, comprised the only retail category which showed growth over the 2007 Christmas season, and the growth was minimal. Categories suffering the worst included upscale stores like major department stores and jewelry retailers, along with catalog and internet sales.
Some, with Circuit City being the latest example, limped into the season with poor sales and could not survive the onslaught. More retail giants are likely to follow suit before the retail bloodbath ends.
The 1,000 American shoppers we interviewed for America's Research Group’s Consumer Mind Reader ™ survey realize their retail debt levels from existing credit card balances and other obligations are simply too high. If they have jobs, they are continually worried about keeping them. Belt-tightening is no longer an option. It is a clear necessity.
How did America’s once flourishing retail community find itself in this perilous situation? I believe the answer is simple and basic. Too many retail corporations stopped listening to their customers on Main Street and paid too much attention to the bankers on Wall Street.
Customer service was sacrificed on the altar of more efficiency and a healthier temporary bottom line. Service personnel disappeared from retail floors. Companies enforced strict return policies and forced disgruntled customers to deal with automated calling systems rather than live personnel.
The end result was that the companies destroyed any semblance of customer loyalty. Turning their back on customers when times were good made it much easier for their shoppers to abandon them when times got bad.
Americans are hopeful that the job outlook will brighten soon, that they can pay down their existing debt and return to being able to buy what they want and not just what they need. But until then many retailers may pay the ultimate price.
Britt Beemer, founder and chairman of America's Research Group, is the country’s leading authority on retail buying habits of consumers. ARG tracks consumer buying habits more than any other survey research firm in the nation. The company conducts customized surveys for retail and manufacturing clients across the United States, designed to provide clients valuable marketing recommendations to grow their businesses.
Beemer is author of two best-selling business books, Predatory Marketing and It Takes a Prophet to Make a Profit. His third business book, entitled The Customer Rules, was released in October and is available at bookstores nationwide. More detailed information is available on the America’s Research Group website at www.americasresearchgroup.com