Retailers Remodel

As reported in Industry Retailer’s June 2010 issue, most brick and mortar retailers felt the effects of a sluggish economy. The result was reduced inventory. Ultimately, low stock led to remodeling, in an effort to dismiss the barren shelves as nothing more than a cleaner appearance to customers. Economic remodeling, however, wasn’t successful for all.

As some same store retailers lost business due to high prices, others such as Walmart were ready to pick up the flood of customers looking for better deals. According to the Wall Street Journal, Walmart decided to renovate as others had, believing that low prices and the cleaner appearance would work in its favor as it attempted, “to appeal to a more well heeled shopper.” Unfortunately, Walmart’s efforts were unsuccessful, encountering one of the longest slides in domestic same store sales in its retail history. The economic conditions seemed to dismantle all rules, and strategic maneuvers used by retailers had a 50 percent chance for success.

As the economy is now seeing a turnaround, brick and mortar retailers are not only adding to their bottom line dollar by dollar, but also refilling their shelves item by item. The new marketing strategy incorporates another remodeling plan, taking a more cluttered approach. Although the effect on customer satisfaction has yet to be known, retailers appear to be profiting from the more claustrophobic renovation. Keep in mind, sales aren’t necessarily a result of customers’ wants or needs, but a lot of times about perception. As Ben DiSanti, senior VP of planning and perspectives for TPN, tells The Seattle Times, “Messiness, or pallets in the middle of an aisle, is also a cue for value. There are a lot of cues that the shopper picks up on in stores.” In summary, and a lesson learned by Walmart, fewer items represent expensive prices, while more items represent discount prices.

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