What has the disparity of incomes in the U.S. meant for the business of retailing? Is there room for middle of the road merchants in a country where the economic middle appears to be shrinking?
What has the disparity of incomes in the U.S. meant for the business of retailing? Well, of course, it has meant a proliferation of high-end retailers on one end, and a proliferation of discount retailers on the other. But is there room for middle of the road merchants in a country where the economic middle appears to be shrinking? Of course there is. Most consumers still consider themselves to be middle class, and still shop, buy and otherwise behave as middle-class. But growing income inequality is real and likely to grow, driven by several unstoppable trends: the education premium, the technological skills premium, winner-take-all labor markets, assortive marital patterns, and immigration. How can retailers respond:
- Cater to the luxury market (yes, plenty of people still have money, even after losing lots of it), and are still spending it
- Cater to those still striving to become middle class (lower income households comprise a huge cumulative market)
- Cater to ethnic markets that are growing (Hispanics, Asians)
- Target current customer retention instead of new customer acquisition
- Broaden (or narrow) offerings
- Variable pricing
- INTEGRATE IN-STORE AND ONLINE OPERATIONS (This may be the most important strategy, as it positions those who are prepared for the future competitive landscape).
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13318
Filed Under Consumer Behavior