The Consumer Economy and Trends 2014
The landscape of warfare for the almighty consumer dollar, especially in household goods, has never been so stacked in favor of the merchandise chasing consumers. For starters, there are too few customers chasing too much furniture, electronics, and other goods.
The consumer marketplace is changing irrevocably now during the economic “non-recovery” as a result, driven by the “new normal” in the economy; this intermediate phase is stacked completely toward the end-user, the purchaser. Many old line retailers will negotiate on pricing – once virtually illegal during the days of “Fair Trade.” The Internet experience also shops the competition for you, bricks and mortar locations are cutting each other’s throats, and estate sales have become a “Let’s Make a Deal” fantasy land of bargains.
This last category is really becoming a hot item, as the rare and period piece of merchandise is up for bid and bargaining like never before due to the immense number of downsizers and the gentrified, let alone estates that must be disbursed due to the end of life.
Problems for merchants:
On the one hand, a nightmare for retailers is that the buyers are fractionated in terms of where they shop and how they shop, plus how they take in their advertising...all at once!
How to spread advertising dollars? Newspapers are in decline, and read by the over 50 crowd only. Some readers read only small sections, on the one hand, but at least ad-buyers can target their ads in delivery to specific select communities.
Direct mail seems to be hitting the trash cans unread; so, much of this bulk is going away.
Social media and email marketing are hot, but there are so many options to locate ads that many a solution is so diluted as to be not cost effective.
The opposite side of the coin is that the consumer is being chased to google, especially among the younger set, just in order to find a fair sample of just what is available...and where to find it.
Who are the consumers now?
This can take on boundaries measured by age, with the under 35 crowd leaning more and more to the Internet exclusively for shopping and purchasing. Those 50 and over vastly trust they can touch and feel in a traditional “bricks and mortar” storefront.
Some breakdowns of types of shoppers now include:
· Price only shoppers – don’t care where they shop and have no brand or retailer loyalty. They google and pursue what they want, wherever it may lead, be it on the Internet or on the land...Find them at Costco, or just googling away.
· Sport shoppers – are a minority of the moderately wealthy where it is the game of shopping that is the driving force. These are middle agers where the “how-much” trumps the shopping venue itself. It’s about wringing out the deal! Estate sales and flea markets are good traps for them.
· Downsizers looking to simplify – and they know what they want. The last big screen TV, the last refrigerator, or the last casual living room suite of furniture is what they want; utilitarian and robust in design are the hallmarks of the products sought.
· New thrifty couples – looking for high value relative to quality is their calling card. New couples setting up their first households span the markets going from the Net, to Big Box stores, to Estate sales and flea markets.
But where to shop and how to buy in general? Even big box retailers are now pushing their own customer base online, developing stand-alone online shopping destinations. This, of course, is a double edged sword. The Net steals from your neighborhood store.
An hh gregg, Sears, or Best Buy all play both sides of the street now, hedging their bets to capture most of the above shopper categories. You may buy in person, over the phone, or on their individual Internet stores alike. You may choose home delivery, home installation, or pick up at a store yourself.
With total Internet sales rocketing by 20% last year alone, surely the long-term outlook for these hybrid business models will include taking on Internet sales from the storefront locations themselves; salespeople walking around with google-glasses to proxy-shop for online customers from anywhere.
What differentiates the various shopping modes, destinations, and opportunities?
The big box stores, as noted above, will enjoy purchasing quantities of commodity goods, allowing for better final pricing to you. Customer service reputations must remain intact, so expect a very lenient return policy and “customer is always right” mentality. Selection may not be so great if a niche product is sought.
The Net offers huge breadth of product availability, but they may not stock much, as it may be set up for direct ship from manufacturer or distribution center. And forget touching or seeing what you want first. Sales tax you will pay if a storefront is in your state. Amazon, too.
Some estate liquidation companies involve unique business models that will certainly engender the business of the ecology minded among us, such as the recycling component of Frederick’s own “The Great Estate Recycle; Mission Transitions – Ameriestates.”
They introduce unique used merchandise weekly, much of it rare or hard to find. They will deal on price enormously, and art treasures, Steuben Glass, wares of silver and gold, plus true antique furniture are common. As a public service and side-benefit to the customer, leftover items from estate liquidation are donated to civic organizations and recycled.
Today’s ongoing trend of consumer leverage means less worry about caveat emptor; price pressure means you win in the competition.
Life has never been so fruitful for the “shop – ‘til-you-drop crowd” as today. The big side benefit is the downward pricing pressures are holding off Inflation...for now.
But shop early for the best selection.