How to Merchandise Home/Gift & New Products in Your Store

 

– by DICK SEESEL

 

 

The upcoming Off Price Specialist Show at the Sands Convention Center promises to be the biggest and most exciting ever. The off price industry has never been in a better position to take advantage of changes in the retail landscape and the economy. And your customers are looking to you for the latest ideas in fashion apparel and much more.

 

As you shop the show this August, you’ll find more exhibitors than ever with expanded assortments of accessories, gifts and home categories. The time is right for you to decide which of these new businesses belong in your store. This article is meant to give you some strategic guidance as well as some tips for driving incremental sales.

 

Let’s start by answering the most important question: Why add new businesses to my store? In today’s retail climate, there are a few important answers to this question:

 

• Off-price stores like yours are already capturing market share from other types of retailers, so it makes sense to broaden the competitive playing field.
• Consumers are more time-starved than ever (that’s why the Web gains share every year), they are looking for “one-stop shopping.”
• If your apparel business is more seasonal in nature (such as outerwear), it makes sense to create more year-round businesses and to take advantage of holiday peaks in demand.
• Most importantly, add-on sales of new categories increase your customer’s “market basket” and average transaction.

 

Next, I like to apply some simple benchmarks for consulting clients (and the students I teach) when they make changes in their assortments: IS IT STRATEGIC? IS IT CONSISTENT? IS IT RESPONSIVE? IS IT RELEVANT?

Let’s dig a little deeper into these four questions to help you consider new categories for your store:

 

STRATEGIC: Is the assortment of new businesses (home, gifts, accessories, etc.) aligned with your store’s existing strengths? Will the new categories appeal to your target market, fit into your store format, let you gain market share from your competitors?

 

CONSISTENT: Is the offering consistent with your apparel offering? Do the price points make sense? Does the mix of brands also make sense?

 

RESPONSIVE: Can you execute the new categories well, and can you continue to execute your existing businesses? Can you devote enough space, or do the new products turn your store into “a bunch of stuff”?

 

RELEVANT: Does your customer want you to expand your offering? Is she looking for the types of products you intend to add?

 

If you can answer all four of these challenges, you are primed for success by adding gifts, accessories and home categories to your store. Now let’s consider the types of categories that make sense for your particular store:

 

• In my opinion, accessories (handbags, shoes, jewelry and so on) make the most sense as add-on businesses for apparel retailers. This ought to be your starting point if you’re not already there.
• Gifts would be a good second choice. These are typically space-efficient impulse businesses that can be freshened seasonally.
• The home store would be my third recommendation. This probably requires a bigger space commitment and better replenishment systems. It’s also most likely to seem “out of sync” with your apparel offering unless you have enough real estate to avoid overcrowding.

 

Whatever categories you start with, you need to consider your existing (and targeted) customer base. Are your shoppers looking for more upscale goods or more opening-price product? Are they interested in “labels” or more generic product? Your new assortment choices need to be consistent with the goals of your apparel selection.

 

Finally, consider the benefits of a seasonal rotation of gift items in your store. For example, you can drive boxed watch business during the Mother’s and Father’s Day seasons. Then follow up with dorm-room and other Back-to-school items. Next step would be Halloween novelty items, and holiday volume-drivers such as fragrance gift sets. The constant newness in your gift assortment will keep your customers coming back for more.

 

Good luck at this year’s Off Price Show, and happy shopping!