Retailers were expecting the Saturday before Christmas to be a blockbuster day, with winter clothing in demand. No one counted on winter storms to dampen the momentum.
Larger department store chains with outlet stores benefitted from their ability to move merchandise that didn’t sell as expected through their clearance centers, avoiding overstocked clutter in their primary stores. Another approach some retailers used was to focus on multi-tier loyalty programs that provide exclusive benefits that rewards members’ engagement with their brands, motivating action.
As large retailers sell off excess inventory at low prices, smaller retailers can still complete at higher prices. They can:
- Offer personalized experiences with technology, such as personalized recommendations and tailored email campaigns, to offer customers a more personalized shopping experience. This can help build customer loyalty and set a business apart from low-price competitors.
- Offer excellent customer service to stand out from the competition by offering free shipping, easy returns, and a knowledgeable sales staff. Price is important to many shoppers, but excellent customer service can be a crucial differentiator for a retail business and create loyal customers willing to pay a little more for a better overall shopping experience.
- Offer higher quality products, differentiating themselves from low-price competitors and justifying higher prices.
- Build a strong brand, allowing them to charge a premium for their products. Customers are often willing to pay more for products from a brand they know and trust. Also, building a unique identity can set them apart from low-price competitors.
- Use social media to connect with customers. Social platforms can be a powerful tool for retail businesses to connect with customers and build a loyal following. Companies can build a positive reputation by regularly posting engaging content and responding to customer inquiries.
- Focus on niche markets where they can offer unique products or services that are in high demand.
By implementing a combination of these strategies, retail businesses can effectively compete with low-price competitors and maintain a profitable business.
