Shoppers will moderate and curtail spending during the upcoming holiday season, says Diane C. Swonk, chief economist and senior managing director at Mesirow Financial.
In the Nov. 10 Themes on the Economy newsletter, Swonk says everybody will move down the retail food chain this year, seeking practical purchases.
“The days of designer bags, shoes, and luxury cars have temporarily passed, unless you buy them at outlet or discount stores,” she wrote in the “Nowhere to Hide Special Holiday Edition” of the newsletter.
Other predictions from Swonk:
- Department stores are expected to continue to lose market share relative to discounters.
- Discounters are expected to continue to gain market share from more traditional department stores.
- Men’s and children’s apparel stores are expected to fare better than women’s apparel stores, mostly because of overbuilding in the market for women’s apparel.
- Electronic and appliance stores are expected to ration, as competition from discounters entering the consumer electronic market intensifies.
Take these predictions to the bank by planning your holiday season accordingly. Have a plan to inform your customers of values available in your store. Stay in touch with customers throughout the season. Create reasons for customers to visit your store. Free coffee? Cookies? A drawing? Put on your thinking cap.
Review with employees your rules of customer service. Then, improve upon those rules. Make sure every shopper’s visit to your store is rewarded with friendliness, surprises, holiday spirit, values and genuine interest in what your customers want and need.