Monday, December 8, 2008

Tips from the Luxury Business Newsletter

For my work, I read a lot of information speaking to retailers, especially those targeting the Luxury market. But in this time of economic troubles, even the luxury research group can help provide some tips for "cash-strapped shoppers"

Expert Pam Danziger offers shopping tips for consumers this holiday season. Her credentials as a shopping authority include her latest book, entitled Shopping: Why We Love It and Retailers Can Create the Ultimate Customer Experience from Kaplan Publishing.

My business is advising retailers and marketers how to get shoppers to spend more money when they shop, but this year with shoppers feeling the economic squeeze, it is only right that I turn the research around to help the cash-strapped shopper," Danziger explains.

Danziger offers five tips that will make shoppers more effective this holiday season.

1) Don't buy it just because it is on sale: Finding things on sale is great and bargains give the shopper a thrill, but one of the best ways that shoppers can save money is not to get trapped into buying things they don't really need or want just because it is on sale. You can easily spend too much money if you focus on what you are saving, rather than what you are spending in order to save.

My rule of thumb about approaching items on sale is it is only worth buying IF it is something that you would pay full price for. My advice: Be watchful and careful when responding to sales. Keep your wits about you and only buy if it is really something that you would want at full price. If you wouldn't pay full price for it, than it probably isn't worth buying it on sale.

2) Don't be afraid to spend for quality: This is another trap for shoppers, especially those prone to shop only for sale items. It is often better to spend more, sometimes a lot more, for quality that will give you a lifetime of wear or use than to buy lots and lots of cheaper stuff. You definitely should spend more for an item that is a classic, that will always be in style and appropriate for all occasions. Sometimes you want to go for the cheap, but other times the smart shopper splurges for the best.

I have met shoppers in research who say they only buy something if it is on sale. That is simply a losing proposition because often times what is on sale is the stuff nobody wants anyway. Shoppers should never be afraid to pay full price or spend more if the quality and value is there. And this brings me to my next piece of advice…

3) Educate yourself about what quality is: Shoppers often limit their shopping trips to just the stores they usually shop in and never cross the threshold of a luxury boutique or department store because they feel priced out. Forget it! The only way to learn about quality is to experience it and that means taking time in upscale stores like Saks 5th Avenue, Neiman Marcus, Bergdorf Goodman or Nordstrom to see, feel, touch and try on the better brands.

To be a smart shopper, you have got to educate yourself about what quality is. Then you can take what you learn and apply it to shopping in the mass-market stores, as well as in the manufacturer's outlets and discount shops.

4) Mass-market has never been better: This is the really big opportunity for shoppers today. The retail environment has never been better for shoppers with excellent quality products available at all price points. You can find outstanding quality goods that can rival the luxury brands in stores like H&M, Target, Gap, Banana Republic, J Crew, Ann Taylor, Macy's, the list goes on and on, if the shopper knows what to look for. Armed with education and understanding about the quality features of the top-notch brands, you can shop much smarter and more effectively in any store. You don't have to buy the well-known brand name anymore to get quality, but you do need to be smart when you shop.

5) Think strategically before you go to the store: One of the most profound changes my research has found among shoppers, especially younger shoppers, is how strategically and business-like they approach shopping. They plan in advance by researching over the Internet the products and brands they want and the stores that are their destination before they head out to shop. Impulse shopping takes a back seat, while shoppers become more careful, more strategic and let their left-brain lead when shopping.

The simple fact is retailers play to emotion and pepper their store with powerful emotionally-laden cues and clues that encourage the shopper to indulge, buy and spend. The best strategy for shoppers to block these efforts is to keep their left brain in control and use discipline when entering the retail environment.

Danziger concludes, "Armed with these strategies, shoppers this season can take advantage of the wonderful shopping opportunities available in this recessionary environment without digging themselves deeper and deeper into debt buying more stuff that ultimately may not be worth it. Today's shopper needs to keep focused on value – getting the most value for the least amount of money. Often times that may mean turning away from poor-quality stuff marked down to fire sale prices and trading up to a more premium, higher quality brand that will offer years of use and enjoyment."

About Pam Danziger and Unity Marketing -

Pamela N. Danziger is an internationally recognized expert specializing in consumer insights, especially for marketers and retailers that sell luxury goods and experiences to the masses as well as the 'classes.' She is president of Unity Marketing, a marketing consulting firm she founded in 1992.

Advising such clients as PPR, Diageo, Waterford-Wedgwood, Google, Lenox, Swarovski, GM, Orient-Express Hotels, Italian Trade Commission, Marie Claire magazine, The World Gold Council, and The Conference Board, Pam taps consumer psychology to help clients navigate the changing consumer marketplace.

Her latest book is Shopping: Why We Love It and How Retailers Can Create the Ultimate Customer Experience (Kaplan, $27) is in the bookstores now.

Her other books include Let Them Eat Cake: Marketing Luxury to the Masses-as well as the Classes, (Dearborn Trade Publishing, $27, hardcover) and Why People Buy Things They Don't Need: Understanding and Predicting Consumer Behavior (Chicago: Dearborn Trade Publishing, 2004).

She has appeared on CNN's In the Money, NBC's Today Show, CNBC, CNN International, CNNfn, CBS News Sunday Morning, Fox News' Your World with Neil Cavuto, ABC News Now, NPR's Marketplace and is frequently called upon by the Wall Street Journal, New York Times, American Demographics, Women's Wear Daily, Forbes, USA Today, Associated Press, Los Angeles Times, Chicago Tribune for commentary and insight.


Ashe Mischief said...

These are great tips-- especially the "only buy what you'd pay full price for." It's something I *try* to live by, even if the budget won't accommodate it. (But I also try to take advantage of a sale on an item I can't afford full price on, but may be able to afford the discounted price on, if that makes sense. It's the grad school way of thinking...)

Freya said...

Such great advice!

And some I learned only recently. I used to be a "bargain shopper" solely and it broke my heart the first time I spent over $100 on an item of clothing. But it became my favorite piece, and I've since come to love slowly amassing a high quality wardrobe as opposed to cleaning out all the cheap, junky stuff each year.

jennine said...

Oh great tips, once I get a job again, I'm definitely going to follow them.


Well I've never read her books but that's the way I shop and it's important to keep those tips in mind. But what I found interesting in her research is the changes in younger shoppers approach and behaviour.

lisa said...

Really interesting read! Thanks for sharing such interesting retail insights.