The shopping gods are reporting initial results from the opening retail season. So far traditional retailers had a year over year increase in sales of about 7%, while online retailers have had a 24% increase. Good news, right?
Well, the same shopping gods predicted a much smaller increase for the time period.
- NRF (National Retail Federation) predicted a 2.8% increase over last year (pre-recession growth rates were at 5-6% year-over-year increases)
- ShopperTrak predicted a 2.2% increase (to be on the safe side)
- Purdue University Retail Institute gave a range of 2-4% increase
Do they suck that bad? Yes, they do, because they don’t pay attention to people and REAL behavior, not just the behavioral models and predicted data analysis they so love. They know shoppers are unemployed, under-employed, and wary of the stock market. They know we are bombarded with news stories of global economic collapses daily.
They know these things, but they ignore them, saying we are a resilient bunch, and still like to shop. They say things like ‘Heck, look how much these folks spent on Halloween candy and treats, that means they like sharing, buying, spending on traditional needs-based things with small, simple luxuries that endure.” Then that translates into “They’ll spend boatloads on iPads and big screen TVs for the holidays.”
Had they stuck their heads out of their think tanks they would have realized that Black Friday shopping has become a family tradition, one where groups of people who have just consumed stupid amounts of food, then watched an annoying amount of football, have decided to take the relatives who are already re-awakened from their post-turkey comas to the mall.
This latest tradition is another way to spend time together without having to talk much, to walk off the guilt of 3 desserts, and to get great deals on stuff they don’t need early so they don’t have to go back to the mall later in the season.
The retail gods should have realized that opening at midnight should have been done years ago, because we’re already up then, having napped. But they didn’t. Because they don’t consider themselves one of us. They don’t consider people, just data. They don’t see how this economy has created a need for new traditions.
We now have a uniquely extended holiday shopping season. Thanksgiving was early, Christmas and Hanukkah come late. There’s an extra weekend in the shopping season this year, AND, it started at midnight, instead of 4am.
Now they will go back to their conference rooms and make new predictions for the overall season. They’ll make public comments about consumer confidence and the resiliency of the American people, to overcome the despair by shopping for specific types of products. Then the retailers will price and stock accordingly, but in the end, the consumers won’t come as predicted. And once again the shopping gods will have been wrong.
Why? Because the economy still sucks. People don’t have jobs. Living expenses have increased and disposable income and credit are no longer in our cache of ammo to draw from. If they got their heads out of their butts they’d know that. They’d be able to tell retailers that this first weekend of the holiday season was as good as it’s going to get, and if they were too risky with their discounts, their profits will be toast.
Retailers, manufacturers, wholesalers, distributors, agencies … they’re all making plans for next year based on year-over-year results, behavior modeling, and data analysis. Once again they are waiting with baited breath on the final numbers for the season to make their decisions for the future ordering, sales and strategies. And once again the data they’ll base their decisions are will be wrong.
Eventually retailers will revolt and begin to protest, along with the 99%ers. Maybe then, once the lobbyists join us, Wall Street, Banks and Washington will start to understand what we’re saying. Your numbers, your perspective, your data is WRONG.
People are not datapoints, without really knowing your customer you will always be wrong.