Jan 27, 2010

Retailers try new survival strategies for 2010By Jayne O'DonnellUSAToday

New York — The recession pushed shoppers to pick necessities over discretionary items, discounts over luxury. But retailers hope to shift such behavioral changes further in coming months, affecting what consumers will buy, pay and experience at stores.

“Retailers are following through on their strategy to get their houses in order during the recession so they are positioned to be strong players as the recession ends,” says Dan Butler, vice president of retail operations for the National Retail Federation, which held its annual conference here this month. “Whether it’s technology, product assortment or sustainability, they’re asking themselves, ‘How can we be smarter about meeting the needs of our customers quickly?’ ”

The NRF said today it expects retail sales to rise 2.5% in 2010, up sharply from a 2.5% sales decline in 2009.

Increasing sales often means responding to what consumers want, such as reasonable prices. But many times, the changes are designed to ensure retailers’ survival, such as when they reduce inventory so they don’t have to resort to deep discounting. Sometimes it does both: Macy’s strategy of offering customers different merchandise around the country allowed the company to downsize its corporate headquarters.

Such changes will continue in 2010; here are four ways shopping will be different.

Retailing is more competitive than ever, so stores have to focus on exactly what the customer wants to buy, says Kevin Sterneckert of the retail advisory firm AMR Research. They need to have a store-by-store sense of how much to stock.

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