June sales are leaving many retailers anxious about the approaching back-to-school shopping season. Consumers continue to buy less and they are more discriminating than ever. However; many brand consultants argue that the recession has not created a pricing shift but a higher degree of awareness regarding the value of products and brands. Today’s discount shopper is clearly reluctant to spend on premium brands if the value is missing.
I recently pulled out C. Britt Beemer and Robert L. Shook’s book "It Takes a Prophet to Make a Profit ... 15 Trends that are Reshaping American Business." Published in 2001, trend #6 reads:
"Consumers Are Reluctant to Pay Full Retail Price"
Their research showed the number one reason Americans dislike paying full retail price is that they think prices are too high. Fifty-seven percent of discount shoppers expressed that opinion. In addition, they reported:
• 82 percent said they knew the item would be on sale someday.
• 82 percent also said that somebody always has it on sale.
• 79 percent said they normally wait for sales because they don’t need an item right away.
• 46 percent felt that quality has suffered.
• 34 percent said that service has declined.
It’s difficult to read consumers because they are not always consistent. But when your customers are skittish about spending it’s not hard to see that both quality and value for the dollar are important.
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