5 Common Habits of Successful Retailers in a Recessionary Economy

As we move into Holiday of 2008 during a recession, what will separate the successful retailers from those that struggle or go out of business?

I'm going to group retail brands into two categories although they don't all fit cleanly this way. Retailers that sell:

1. Products/services we want
2. Products/services we need

In times of economic uncertainty consumers often heavily reduce spending on the products/services we want category and trim back to a lesser or greater extent on the "need" category. However, there are common habits of successful retailers from both categories even when sailing into a stiff economic headwind.

These common habits include:

1. Strong value proposition for a "best" customer segment that is sufficiently large enough to create economic prosperity for the company. Be focused.
2. The ability to introduce new and relevant products/services that are affordable and "low" risk. We know consumers want to take fewer risks when they are worried about their job and 401K but do we offer lower risk products. Reduce risk.
3. Trigger marketing programs that will allow customers to provide clues on their needs and the company has the communications infrastructure to engage the customer based on those triggers (this could be lack of activity that signals the customer may churn or recent activity that suggests the customer may have additional unmet needs). React to their triggers.
4. The ability to actively "listen" to customers and quickly meet their needs. This could be through formal guest loyalty research or by using online tools to dial into what the most passionate participants are discussing online either on your site or in a forum that attracts other similar consumers. Listen and participate.
5. A nimble structure to move quickly and apply the learnings to ensure the value is delivered in a timely manner. Move fast.

Feel free to comment.

Jeff Fromm

jfromm@adamson-usa.com