Little Rock has been named the seventh best metro for jobs in the nation. According to Forbes, the region’s net employment outlook is 12%, the percentage of jobs local employers expect to add this fall.
Forbes.com wrote: “Little Rock is home to Dillard’s Department Stores, Windstream Communications and Acxiom, which all hire in considerable numbers. The University of Arkansas drives hiring with its large medical complex.”
www.forbes.com for more information.
At number six, Arkansas has been named among the ten best markets in the U.S. for single-family real estate investment properties.
From The Wall Street Journal (August 21, 2010), By M.P. McQueen
Looking to snap up some investment properties on the cheap? You may want to consider Durham, N.C., Indianapolis and Huntsville, Ala (or Little Rock, Ark.). They are among the best places to invest now, according to a new report that ranks the best and worst markets for conservative residential-real-estate investors. Hard-hit Las Vegas and Orlando, Fla., are among the riskiest.
Local Market Monitor Inc., a Cary, N.C., firm that analyzes real-estate trends for lenders, builders and investors, compiled its first Investor Suitability Report using economic data through July 31 for 315 U.S. markets. The firm is best known for its housing-market forecasts, which use “equilibrium” home prices: what home values should be in relation to incomes, job growth and population. In its new report, it uses similar data to rank communities by their investment prospects, focusing on single-family homes.
Regions that rank highly for investment suitability are those where there is a low probability that home prices will fall further, says Local Market Monitor President Ingo Winzer. They are places where income is growing moderately; where employment is relatively stable because of a large percentage of jobs in health care, education or government; and where a relatively small share of jobs is in construction or financial services, which have been volatile. (Job losses in government and education tend to come later in an economic cycle, so some areas could be hit harder in coming months.)
The report, which excludes towns with fewer than 200,000 residents, focuses on price-appreciation potential instead of rental income, since falling home prices usually result in higher vacancy rates in apartment buildings and lower rents overall, Mr. Winzer says.
Good markets for conservative investors are those that already have stabilized and should yield average returns, Mr. Winzer says. Dangerous markets probably will see further price declines and have little potential for a turnaround because of poor local economies.
So-called speculative markets, by contrast, are those where prices could fall further, but which also have potential for greater appreciation of 3% to 5% annually after bottoming out—making them more suitable for investors with stronger stomachs. Local Market Monitor identifies Hagerstown, Md.; Jacksonville and Port St. Lucie, Fla.; Modesto, Calif.; and Myrtle Beach, S.C. as speculative areas.
In the best markets, home prices already are stabilizing. Durham, N.C., for instance, is home to Duke University and is near the University of North Carolina-Chapel Hill. Big companies like International Business Machines Corp., GlaxoSmithKline PLC and Nortel Networks Corp., as well as numerous biotech start-ups, have facilities at the nearby Research Triangle Corporate Park. About 40% of area jobs are in health, education or government, according to Local Market Monitor.
Haywood Davis, owner of a Century 21 real-estate brokerage in Durham, says home-sales volume in the area increased 13% last month over July 2009, though prices rose only slightly.
Some other metro areas with large percentages of relatively stable jobs and moderate growth include Knoxville, Tenn.; Lexington, Ky.; and Indianapolis.
Jason Moore, a 34-year-old auto-sales manager in Baltimore, took advantage of plunging home prices in his hometown of Indianapolis to snap up an investment property there—a brand-new four-bedroom, two-bath home—for $56,000 late in 2008.
Prices in Indianapolis were falling because of foreclosures and rising unemployment. Disappointed with their stock-market investments, Mr. Moore and his wife, Keisha, 32, decided to buy an investment property to add to their portfolio. The Indiana house is generating a positive cash flow of about $300 a month in rent after mortgage, insurance, taxes and fees, he says. If you are interested on getting the same insurance Mr. Moore has use this link to get all the details about this great insurance.
“It has been adding income, and the tax benefit has been helpful,” Mr. Moore says.
Yet in gambling-and-tourism-dependent Reno, Nev., home prices slid 50% from their market peak in 2006—and don’t seem to have bottomed yet. Mr. Winzer calls the city “frankly dangerous” for investors, along with Las Vegas and Naples and Orlando, Fla., because home prices are still tumbling and local economies are shaky.
John Burns, chief executive officer of John Burns Real Estate Consulting Inc. of Irvine, Calif., says he thinks Reno and Las Vegas have “overcorrected,” but he agrees prices could fall further.
Dana Hall-Bradley, a real-estate agent in Florida’s Orlando-Kissimmee area, near Disney World, says sales were up 39% last month over July 2009. But prices are still sliding because most sales involve so-called distressed properties—bank-owned homes or short sales, where lenders agree to sell properties for less than they are owed.
Investors, especially those from Canada, the U.K., Brazil and Venezuela, are buying vacation and retirement villas, condos and townhouses in the area, Ms. Hall-Bradley says, because prices already are 40% to 50% below what they were as late as 2007. Many are paying cash.
Condos are even cheaper. “Right now you can get a condo for $30,000 that was selling for $150,000 to $200,000 in 2005 or 2006,” she says.
Eamon Lavin of Locust Valley, N.Y., recently purchased three condo units and a single-family home in Celebration, a planned community outside Orlando designed by Walt Disney Co. Mr. Lavin, 43, says he knows prices could tumble further but he isn’t worried because he plans to rent out the properties for 10 or 15 years.
“I love the area, and I think it is going to come back,” he says. “I get more of a return on investment than putting it in a bank or anywhere else.”
Write to M.P. McQueen at mp.mcqueen@wsj.com.
The fabled discounter is aiming to thrive even if the economy sputters. That’s good news for shoppers — and shareholders
IN THE PAST TWO DECADES, Target, the Minneapolis-based discounter, carved out a unique niche as a purveyor of cheap chic. Its brand-name apparel and Michael Graves-designed housewares were stylish enough to earn it the Frenchified nickname “Tarzhay,” while its prices were low enough to lure serious bargain hunters.
This looks-are-deceiving formula worked like a charm until 2008, when the financial markets imploded, the economy tanked and America headed for Wal-Mart, which offered even lower prices, and the heck with style. As customers fled, Target’s sales and profits tumbled, and its shares, once 70, were marked down to 25.
Never underestimate a savvy merchant, however, especially one that can make potholders sing. Target (ticker: TGT) has crafted a comeback plan that looks to be winning new fans on Main Street and Wall, where its shares, like its wares, are now cheap and chic. They rallied very slightly last week, to around 52, helped by Thursday’s report that same-store sales, or sales at stores open at least a year, rose 2% in July, even as the broader economy showed signs of slowing. If the company’s merchandising and price promotions succeed in driving traffic and lifting profits, the stock could hit 70 in a year.
“Consumers do not appear to be returning to their bunker of late 2008 and early 2009,” Adrianne Shapira, a retailing analyst at Goldman Sachs, wrote in a recent report. Shapira rates the stock Neutral, with a price target of 55, but notes she is “warming up to the Target story,” given the company’s “unique top-line drivers that aren’t dependent on a macro recovery.”
These include initiatives such as PFresh, a rollout of fresh groceries in many of the chain’s 1,743 stores, and a 5%-discount program, which will be launched this fall. Target also boasts excellent cost controls, which could help boost earnings by more than 15% in the fiscal year ending January 2011, even if sales remain soft.
Analysts expect Target to earn $3.88 a share for fiscal ’11 and $4.40 for fiscal 2012. Shares trade for only 11.7 times 2012 estimates, in line with the valuation accorded Wal-Mart Stores but below that of Costco Wholesale.
BEARS CAUTION A sputtering recovery will hamper Target’s growth, and that PFresh is an expensive undertaking that won’t stimulate sufficient traffic and sales. They note that Target was badly burned by the recession that started in 2008: For many months, same-store sales trailed those of Wal-Mart, which is more reliant on low prices and nondiscretionary items such as groceries. Target earned $2.86 a share in the fiscal year ended January 2009, compared with $3.33 a year earlier, as revenue grew by a paltry 2.5%.
Last year the company began taking steps to re-energize top- and bottom-line growth, consistent with its “Expect More, Pay Less” marketing message. In July 2009 it started matching competitors’ advertised prices on identical items in local markets, and this past January it launched The Great Save, a seven-week program aimed at competing with warehouse clubs on staples such as bottled water.
Management, led by CEO Gregg Steinhafel, 55, also has been working directly with vendors to keep costs in check, and has increased Target’s reliance on higher-margin private-label goods, sold under names like up & up, Archer Farms and Market Pantry. Analysts estimate that private-label goods now account for more than 20% of all food products, up from 18% in 2007. Target declined to make Steinhafel or other executives available for interviews.
These initiatives and a typically intensive focus on costs seem to have worked, as earnings rebounded to $3.30 a share in the latest fiscal year, even though revenue rose less than 1%, to $65.4 billion.
This fiscal year started strongly: Target earned 90 cents a share in the April quarter, up from 69 cents the prior year, on a 5.5% jump in sales, to $15.2 billion. Same-store sales rose 2.8%, the best showing in 10 quarters, and operating cash flow approached $1.2 billion, compared with $1 billion in last year’s first quarter. Plus, the company paid off nearly $1.2 billion of long-term debt, leaving its debt-to-capital ratio at about 50%, reasonable for a capital-intensive business such as retailing.
Two other signs of good expense controls: Gross margin was 31.3% of sales, up from 30.8% a year earlier, suggesting Target didn’t take costly markdowns, and sales, general and administrative expenses totaled 20.6% of sales, down slightly from the prior year, and continuing a favorable trend.
Target sells at a slight premium to Wal-Mart, but a discount to Costco. Apparel, which made up 20% of revenue in the fiscal year ended January, has been strong this year, but home furnishings have been soft.
In the latest quarter, sales of housewares have slowed, but apparel has remained strong. Although same-store sales growth of 1.7% was below management’s prior guidance of 2% to 4%, monthly gains are trending up. Target will release July-quarter results on Aug. 18.
ONE RESPONSE TO TOUGH times has been a roughly 50% reduction in capital spending, to between $2 billion and $2.5 billion. Target opened about 100 new stores annually in the past few years, but plans to open a net total of only 10 new this year. The precipitous decline also reflects a dearth of viable real estate, as fewer shopping centers have been developed since the economy and financial markets tanked. The company said in a presentation to analysts earlier this year that it will add at least 20 new stores, net, next year.
Less money spent on store growth means more cash available to buy back shares and pay dividends. In late 2007, Target’s board authorized the repurchase of $10 billion of common stock, but suspended the program a year later to preserve liquidity. In January the company said it was resuming buybacks, and bought in $394 million of stock in its fiscal first quarter. Target has repurchased 111.1 million shares since late 2007, for a total cost of $5.7 billion.
The company has paid dividends for 171 consecutive quarters, or more than 42 years, and lifted its quarterly payout by 47% in June, to 25 cents a share from 17 cents, for a current yield of 1.9%.
About half this year’s capital expenses will fund the remodeling of 340 general-merchandise stores in markets such as Washington, Los Angeles and Chicago. In all, Target plans to remodel roughly 1,100 of its nearly 1,500 general-merchandise units, which are smaller than its 251 Super Target stores.
Central to the remodeling strategy is the introduction of PFresh, which adds meat, fresh produce and baked goods to an existing lineup of dry grocery, dairy and frozen-foods products. Nearly all PFresh products are prepackaged and bar-coded, facilitating checkout and inventory control. At an extensively renovated Target in Edgewater, N.J., which introduced PFresh in mid-July, the grocery section now features items such as ground beef, chicken and prepackaged cold cuts.
“Target can offer prices 10% to 15% below the grocery store,” says Stacey Brodbar, an analyst at asset manager W.P. Stewart, which owns shares. “It will be a home run if they can get customers to cross shop.”
Indeed, PFresh is designed to draw more shoppers into stores, in the expectation they will pick up higher-margin housewares and apparel after stocking up on consumables. Customers who purchase food at Target stores spend 8% more than those who don’t, and they visit the discounter four more times a year, according to Citigroup. “In order to drive traffic, you need to do consumables,” says Citigroup analyst Deborah Weinswig, who has a Buy rating on the stock and a 12-month price target of 75.
TARGET HAS A MINUSCULE share of the U.S. grocery market, and food will never be as central to the company as it is to Wal-Mart. But that doesn’t mean PFresh won’t generate tasty returns.
It costs roughly $3 million to remodel a store built in the past five to eight years, with about $1.8 million allocated to merchandising improvements, mainly PFresh. In the first year following renovation, Target expects to see an average increase of 6% in traffic and sales, Chief Financial Officer Douglas Scovanner, 54, told analysts earlier this year. By the third year it expects sales to rise 10%, and is forecasting 10% to 14% returns on invested capital.
“Even if it turns out to be 10%, that’s still a pretty encouraging metric for them,” says Barclays Capital analyst Robert Drbul, who rates Target Overweight, with a 12-month target of 65.
Target also is remodeling other sections of its stores, including electronics, beauty and shoes. At the Edgewater, N.J., outlet, some shelving units have been lowered to 54 inches from 84 inches to improve sight lines. In the electronics department, flat-screen televisions are displayed along a wall instead of on shelves. Interactive displays throughout the store give customers additional information about various products.
This fall, Target will start offering customers a 5% discount on nearly every purchase made via its REDcard program, which includes the Target Visa credit card and a Target charge card. The program tested well in Kansas City, even though the company relied only on in-store advertising and marketing, notes Colin McGranahan, an analyst at Bernstein Research. “Five percent is a number that gets people’s attention,” McGranahan says.
Target’s sales at stores open at least a year rose 2% in July, the company reported Thursday. Same-store sales tumbled in April, most likely due to an early Easter, but have been trending higher since.
Target Card charges accounted for only 5% of retail sales last year, and the discount is apt to spur more card use, which is lucrative for the company. Target hopes the discount program will lure new customers and induce existing shoppers to shift more of their spending to Target from other retailers. Management predicts the program will boost same-store sales by one percentage point in the fourth quarter, and one to two points next year, when it will be accretive to earnings. McGranahan reckons the discount program will increase annual sales by about $1 billion, split between new and existing card users, and add eight cents a share to earnings next year.
Competitors most likely will respond, but at Wal-Mart, at least, a higher percentage of customers use cash, not plastic.
TARGET’S CREDIT-CARD PORTFOLIOhas generated controversy in recent years. Hedge-fund manager William Ackman of Pershing Square Capital Management mounted an unsuccessful proxy fight in 2009 after pressing the company to sell the card business, which had mounting receivables at the time.
Target was late to get its hands around its worsening credit-card problems, but the portfolio is on the mend now. Although net charge-offs climbed in the latest quarter to 15% from 13.9% a year ago, delinquencies are trending downward, as is bad-debt expense. In the first quarter the provision for bad debt was $197 million, versus $296 million a year earlier.
The company has tightened its underwriting standards and lowered the size of its credit lines. Fewer receivables, and impending legislation that will lower late-fee revenue, mean less potential income, but a healthier portfolio also is less of a drag.
Some Target watchers fret about the company’s growth prospects, noting its U.S. footprint is mature. But Steinhafel told analysts in January that Target could boost its store count to as many as 3,000 outlets. Wal-Mart, which has a bigger presence in rural markets, has 4,100 stores and clubs. Target is considering smaller formats in cities that can’t accommodate mega stores, although it recently opened a 174,000-square-foot outpost in Manhattan’s East Harlem neighborhood.
As for international expansion, Target doesn’t see that happening for at least three to five years. Canada, Mexico and other parts of Latin America are considered ripe targets for expansion.
FOR ALL ITS FOCUS ON the “Pay Less” part of its marketing mantra, Target also is encouraging shoppers to “Expect More,” at least in terms of products and presentation. Some maintain the company has lost its merchandising edge, but company-wide promotions such as last spring’s Liberty of London for Target, which encompassed more than 300 products, suggest otherwise.
Other successful merchandising initiatives include the Giada De Laurentiis for Target cookware line, launched in January and endorsed by the Food Network star, and Converse One Star, a sportswear program that’s been built around the famously retro footwear. Target also is the exclusive bricks-and-mortar retailer for the Amazon.com Kindle, which could grow even more popular as prices continue to drop.
Lately Target has found itself the object of a boycott by consumers who are irate that the company donated $150,000 to a pro-business group backing a Minnesota gubernatorial candidate strongly opposed to gay marriage. As more corporations exercise their newfound right to make such political donations, however, the company could find itself just one of many denounced by the left or the right.
Unlike many retailers, Target is well prepared to combat an arguably more insidious threat: a second U.S. recession. Then again, being well ahead of the curve is just what consumers—and shareholders—have come to expect from Tarzhay.
Is an out-of-touch industry starting to get it?
As retailers seek to excite the elusive consumer and pump up underproductive space, a surge of store prototypes are being rolled out in an attempt to transform America’s cookie-cutter landscape.
All eyes will be on the West Coast next week, where Bloomingdale’s and Nike unveil prototypes in Santa Monica Place in California. In the case of Bloomingdale’s, it’s a beachy version of the department store’s contemporary-driven SoHo unit in Manhattan, which the company hopes to replicate elsewhere. At Nike, “there’s a new mission on retail stores now,” said a source. “They want to take control of the environment where their products are sold.”
Jeanne Jackson, former Banana Republic president and former chief executive officer of walmart.com and Gap Inc. Direct, was a Nike Inc. board member but last year shifted into the role of president of direct-to-consumer and has been leading the retail effort.
The two-story, 20,000-square-foot Nike store will provide sports teams customized products in 115 styles, market-tailored product offerings, community resources and the introduction of Nike+ Run Club, and is Nike’s first multicategory opening in the U.S. since the last one in 1999 in Denver, according to Nike media relations manager Jacie Prieto.
They aren’t the only brands tinkering with their retail formula, however. At Brooks Brothers, a younger adult offshoot is on the drawing boards. “We have something in mind but didn’t start anything yet. We put it on hold. There’s nothing before 2012,” said Claudio Del Vecchio, chairman and ceo. In line with its younger state of mind, Brooks Bros. on Wednesday opened its first freestanding girls’ and boys’ shop called Fleece, in Westport, Conn. The unit is a 1,500-square-foot “test” store, marking the company’s first go at girls’ merchandise, said Del Vecchio.
AnnTaylor Stores Corp. is cooking up an Ann Taylor prototype in Atlanta to test new concepts while a Loft prototype opened earlier this year in the Paramus Park Mall in New Jersey. Elements of the new Loft look will be rolled out in varying degrees to other sites. J. McLaughlin, the preppie chain, is developing a 5,500-square-foot format in Westport, five times larger than its largest store. Earlier this year, J. Crew opened is first bridal store on Madison Avenue that takes a broad point of view to the business, covering the before and after parties, rehearsal dinners and the honeymoon night, as well as the actual wedding.
“People are tired of the same old, same old. They’re hungry for new things that are not mass produced, and don’t want to buy into cookie-cutter,” said Raymond Graj, founding partner of Graj + Gustavsen, the creative firm that helps companies build and market brand images and also develops store concepts. “You do have established players looking to evolve. Progressive, more well-funded people are really trying to figure it out. Opening retail is not a cheap prospect, though the softness in real estate poses some opportunity.”
Among brands, Disney is reinventing its stores to revitalize the business; Levi Strauss & Co. has a trademark called Denizen, which, while not yet confirmed, retail sources said will be 1,000-square-foot stores targeting 18- to 28-year-old women and men in emerging middle-class markets such as India and China, and Kellwood Co., which has several labels in its portfolio, is said to be developing retail concepts. Kellwood currently operates just Vince stores and Sag Harbor outlets.
“We have been approached in the past six months by maybe a half-dozen major brands to do new prototype work,” said Tom Bowen, a principal of Callison, the architecture and design firm. “Some of those we have landed, some we haven’t. There is a surge among strong retailers looking at ways to position themselves ahead of the competition through new prototypes. We also see much more focus on making prototypes internationally adaptable. Real estate costs through the boom years went very high, so they’re paying [dearly] for underproductive space and have to figure out how to make those stores more productive.”
Innovation is also seeping into the outlet sector, which aside from the Internet has been drawing the best sales gains as shoppers trade down and seek better values amid the recession. Macy’s Inc. is considering opening Macy’s outlets, while the Bloomingdale’s division is set to open its first two fashion outlets, in Potomac Mills, Va., on Aug. 20 and Bergen Town Center in Paramus, N.J., on Aug. 27. Store executives say the Bloomingdale’s outlets won’t be the typical bare-bones rack operations that outlets tend to be, but will have an ambience befitting the brand.
“A small percentage of the merchandise will come from our stores, but the vast majority will be fresh for the outlets and within the Bloomingdale’s matrix,” Michael Gould, the retailer’s chairman and ceo, said in an interview earlier this year.
Bloomingdale’s moves follows those at Off 5th, the outlet division of Saks Inc., which elevated its look two years ago with a prototype in Orlando that’s being rolled out. Similarly, The Talbots Inc. in the past year opened about two dozen “upscale” outlets, and intends to raise the store count to about 100 units by yearend.
The prototype push comes after waves of store closings over the past two years, weeding out unprofitable units and rectifying years of overexpansion. With shored-up balance sheets, in many cases, retailers can take some of the cash they’ve stockpiled and experiment with new store designs and formats. Merchants seem to be waking up to what consumers want — retail experiences that are different and more exciting and sociable than shopping the Internet.
“The days of being able to just stamp things out isn’t good enough anymore,” observed Dawn Clark, vice president of international store design for Starbucks Corp. “The bar is now higher, especially for a more sophisticated, higher-value-oriented customer. They want to see variation. They don’t want boring. The customer has changed. When you are building multiple unit retail businesses, there’s great cost leverage by standardizing things. That’s something you have to look at from a business perspective. But things were overbuilt. Retailers became oversaturated.”
Starbucks, after seeing its business slump, is developing a concept called Olive Way, a bellwether store in Seattle selling wine and beer expected to open in the fall. Starbucks has also been testing its 15th Avenue Coffee and Tea concept, which has no Starbucks branding, save a tiny handwritten note on the door indicating the store was inspired by Starbucks. It also has different roasting methods and a European-style bakery.
“This was really an opportunity to create an environment that wasn’t affected by the already packaged nature of the established brand language,” Clark said. “It’s really an experimental store,” based on creating the aura of a privately owned local coffee shop with some of the standard elements of the Starbucks brand.
There’s also Roy Street, another Starbucks prototype in Seattle, which attempts to capture the character of the surrounding architecture and, last April, the Starbucks in New York’s SoHo on Spring Street reopened with a more sophisticated look featuring dark woods, big coffee-themed graphics, baskets to display coffee and comfortable seating.
The Starbucks prototypes are shooting for greater productivity and community aesthetics, and establish new formulas for further expansion, particularly overseas, where much more growth is seen and where Starbucks will be challenged to adapt to foreign cities what’s been a standardized approach in the U.S. According to Clark, Starbucks is developing different styles, palettes and environmental sustainable construction methods for greater adaptability to different settings. “Everything had become very systemized and very much the same,” Clark said. “Starbucks built out so fast there was not a lot of time to look more carefully at what was relevant to the local community. It was really one size fits all, and it turned out some communities didn’t relate to that concept.”
“Competition for customers is much stiffer and stores have been losing out to the Internet,” said Callison’s Bowen. “It’s crazy how the consumer dollar is being split across so many places. The days of people just going out and spending $500 in a day on clothes just doesn’t happen that much anymore. Retailers have to really appeal to the consumer with a differentiated brand and store experience.”
TO THE POINT
Formats for the Future — Who to Watch
Starbucks: Remaking stores with new designs and decors to break the mold, adapt worldwide and connect locally.
Bloomingdale’s: Scaling down with specialized stores emphasizing contemporary offerings, and introducing fashion outlets in August.
Levi Strauss & Co.: Launching a new chain for emerging middle markets, said to be called Denizen.
Brooks Brothers: Currently testing a new kids’ concept and planning a young adult chain possibly for 2012.
Nike: Looking to regain traction at retail with a prototype launching next week in Santa Monica.
Understanding the personality of your targeted shopper is the first step toward effective retail marketing.
“While demographics matter very little, there are two critical personality dimensions that will define shoppers in the new shopping reality,” said Wendy Liebmann, chief executive officer of WSL Strategic Retail, a retail and marketing strategy firm. “There are people who lived within their means during the recession and will continue to do so, and those with the shopping gene who live to shop and will do it a lot.”
In a recently released survey, 2010 How America Shops MegaTrends Study, The Odyssey Begins to the New Retail World, WSL identifies five shopper personalities:
– Shop-a-Lot Sue. She loves to shop, and although she has limited means — a household income of $60,000 — this is “not a deal breaker,” the survey found. “Sue knows she doesn’t have much to spend, so she shops smart, which lets her buy more.” She often opts for online options or chooses mass merchants such as Wal-Mart or even dollar stores. “She’s given up her aspirations for big-name brands and is OK with less.”
– Miserable Mona, who also has a household income of around $60,000. She is “so jaded by her financial situation that she finds no pleasure in shopping. Making ends meet is a constant struggle.” Although she, too, shops at discount or dollar stores, she doesn’t use online tools to help her.
Although both Sue and Mona are discount-store shoppers, retailers are better served marketing to Sue with coupons and sales promotions. “As a bargain hunter, she will return again and again to the places that reward her hunt,” the survey found. Merchants should also strive to make their stores as attractive as possible and offer as much “aspirational merchandise” as possible to appeal to this shopper.
– I’ll Pass Patty, who is apathetic about shopping and views it as a necessity. She has an above-average household income of $90,000 but lives within her means. She often opts for online shopping to avoid having to go to stores. “To her, smart shopping is no shopping,” the survey said. “Low price is important, but not if it means having to shop around.”
– Bubble Barbie, who spent the recession living in a bubble, ignoring everything and continuing to shop. Her household income averages $72,000, and she visits stores often although her debt level is high. “Bubble Barbie is the best reason to keep doing attractive displays of new products that stop her in the aisle and add more to her basket,” the survey said. “Sales and discounts are good, but not necessary for her to buy.”
– Chic Chic Charlotte, who has a high household income, around $101,000, and loves to shop. But even she was impacted by the recession and will buy less than she had in the past. “The more affluent have developed a case of retail guilt. She is not as spendthrift as she was in the Nineties. Reassure her that you are offering her value.”