Recession Means Big Changes in Retail: Less Inventory, More Invasion of Privacy
According to The New York Times, the recession is going to permanently change that landscape of retailing. In order to stay in business retailers are reevaluating every aspect of their operations to make it more efficient and more more appealing to consumers. So what exactly will that mean for the consumer? Big changes.
And the impact will mean both sweeping changes in the merchandise on their shelves and subtler alterations, like how many pantyhose to keep in stock.
High-end stores like Neiman Marcus, Saks and Coach will offer more midpriced merchandise. Many chains, including Wal-Mart, will carry less inventory and fewer brands. The likes of Sears and J. C. Penney will put self-service computers in stores so customers can browse collections or buy out-of-stock items. And retailers of all stripes will offer more exclusive merchandise and more attentive customer service.
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At high-end stores, the era of ever-escalating prices on luxury goods appears to be over. In the future, consumers will still be able to buy chic brand names, but at a wider range of prices.
"Our customer loves our brands," said Stephen I. Sadove, chairman and chief executive of Saks. "They don't want to trade down to lower brands. But they want more of a range in price within the brands that they love."
And that is what retailers intend to give them. Burton M. Tansky, president and chief executive of Neiman Marcus Group, told investors on a conference call last week that "we're working with the designers to try and ease a portion of their collections into a new price range."
Prices will also be lower at some "affordable luxury" chains, like Coach, which is increasing the proportion of handbags it sells for less than $300. About 50 percent of the company's handbags will cost $200 to $300, in contrast to about 30 percent of handbags last year.
Another change is that consumers will have fewer brands from which to choose. Wal-Mart, Target, Home Depot, and PetSmart are just a few of the chains winnowing their brands. As Home Depot's executive vice president for merchandising, Craig Menear, put it: consumers are "time-starved” and “looking for simplification in the entire shopping experience."
If the service gets any more "attentive" at luxury retailers, we're going to need a restraining order. It's gotten so bad that lately we are actually avoiding some luxury stores because of the obsequious sales help. We can't even get from the cosmetics counter to the shoe salon without being accosted ten times by desperate sales people. Friendly is one thing, but we feel stalked every time we hit an upscale department store these days.
Other changes are downright creepy. Saks has implemented software so any salesperson in the store can immediately pull up your clothing size, how much you spent and what kind of shoes you buy. That is an invasion of privacy that we find appalling. This is totally different from having one salesperson who knows your preferences and guards them -- and the rest of her clients' preferences -- jealously. When you go into a store and a sales person asks for your name and address, that's what's happening. You're being tracked in a computer database. Computerized snooping, less selection and more self-serve kiosks: these are not good things.
