U.S. Retail Sales Up in May

Short and sweet:

From Forbes.com, retail sales in May were up 1.0% which was double economists predictions.  It was the largest consumer spending month since the Christmas season. 

It was the second month in a row that retail spending was higher than expected.  If you deduct automobile sales, the May increase was 1.2%, the largest gain since November, 2007.  Surprisingly, building store sales rose 2.4% in May.

Obviously we’d like to see larger increases, but the fact is that people are spending money.

High Energy Prices Aren’t Bad for Everybody

 

In a story from the Associated Press, writer Rachel Beck points out the rather obvious fact that, with gas prices hovering around $4.00 per gallon, people are staying home and “entertaining themselves with backyard barbecues, craft projects, and lots of television watching.”

drabble_pool

Obviously that’s a problem for many industries, but what about those of us who sell products that are used at home?  Television sales were up in May versus April, and versus May, 2007.  Merrill Lynch chief North American economist David Rosenberg says “households seem  bent on cocooning by staying home to watch television rather than driving to the local theater and shelling out more than $11.00 to watch a film (and an extra $5.00 to get there).” 

While MYOB tries to be industry-neutral, there’s good news for the sewing and vacuum industries.  According to the Conference Board, consumers plan to buy more vacuum cleaners.  The theory is that if you’re spending more time at home, you want the place to be clean.  Wal-Mart  said last week that floor care is currently one of their strongest departments.  Don’t let them have all that extra business!

 

More good news, Jo-Ann Stores posted a first-quarter profit and exceeded Wall Street expectations.  Same store sales were up 4.5%.  If people are staying home, they need something to do and that means more sewing and crafts.  Add the $600 tax rebate that many consumers are still waiting to receive and you have an opportunity to make some extra sales.

 

The arrival of hot summer temperatures combined with increasing energy costs should also make for a lot of ceiling fan sales, especially if people are spending more time at home.  If you sell fans and you’re not promoting their energy-saving potential, you’re leaving money on the table.

 

I could throw out some tired old cliche about making lemons out of lemonade or clouds with silver linings, but I won’t.  I’ll  just point out that there’s always an opportunity to create sales, no matter what’s going on in the economy.  The thing that separates successful merchants from the rest of the pack is the ability, and the willingness, to find those opportunities and turn them into sales.

 

What are you doing to create sales this summer?

What’s More Important–Gas or Beer?

      

From the Wall Street Journal comes a report on the consumer unrest being caused by the increasing cost of beer.  According to WSJ writer Nancy Keates, the anger over $4.00/gallon gas is nothing compared to the outrage over increasing beer prices.

 

Falsie_glass
It seems that some bars and restaurants are serving beer in glasses that look like a pint but actually contain only fourteen ounces.  The glasses, called “falsies” have a thicker bottom.  They look like a pint, but they’re not.  There are also complaints that bartenders are pouring beer with a deliberately thick head which means the customer is paying for two ounces of beer but getting two ounces of foam.

 

Angry beer drinkers are fighting back by identifying the establishments that are serving the so-called “cheater pints on Internet discussion boards, blogs, and podcasts.  A group called the Honest Pint Project (their slogan-pay for a pint, get a pint) collected more than 400 names on a petition asking state governments to enforce a 16 ounce pint.

 

The article points out that in the U.K., where a pint is 19.2 ounces, beer must be served in “official” glasses that bear the CE mark, etched in the glass.  Still, British beer drinkers complain that bars are “pouring short”.  Their official organization is called “Campaign for Real Ale.”

 

Meanwhile, gas prices are spiraling out of control and we seem to be taking it in stride.  I wonder if either Mr. McCain or Mr. Obama were to announce plans to ensure that beer drinkers are getting a fair shake, they might be assured of a victory in November?

 

The lesson here?  Perception equals reality.  When you try to anticipate how consumers are going toGas_beer_2

respond, there is no sure thing.  A 16 ounce bottle of beer at Busch Stadium in St. Louis costs $8.75, or $70.00 per gallon, making gas look like a real bargain.  But the same people who ride the bus to the ball game to save money have no problem with drinking five or six beers (after buying an $80.00 ticket).

 

If you make them want your particular widget badly enough, they’ll pay your price.

81 One Line Ideas

Here’s an interesting list of 81 marketing ideas from Sam Decker on the Decker Marketing web site.  You won’t be able to use all 81 of them, but if just one of these suggestions get your creative juices flowing, then it’s worth the few minutes it will take you to look them over.  The list is a follow up to an earlier post called 193 Creative Marketing Ideas.  Check it out too.

Good luck and let us know which, if any, of the ideas you decide to try.

Downgrading Your Operating System

Windows_xp_logo_

Windows_vista_logo
You may have heard that Microsoft’s Windows  Vista operating system has been less than a booming success.  You may have also heard that you will no longer be able to buy Windows XP, the system that Vista replaced after the end of this month.  Really?  Well, yes and no.  Here’s the real scoop from PC World.

Microsoft will stop selling XP to retailers and OEMs on June 30.  But, the retailers and OEMs can continue to sell XP software and XP computers as long as they have inventory.  So the imminent demise of XP has been overstated.  Microsoft will continue to provide support through 2014.

But wait, there’s more!  Because there have been so many problems with Vista, Microsoft offers what they call  "downgrade rights."  A computer manufacturer can sell you a new machine with Vista installed and then downgrade it to XP before you take delivery.  You’ll receive the installation discs and drivers for both operating systems, giving you the option to "upgrade" to Vista if you choose.

The "downgrade option" won’t be available on all computers, so check before you buy.  System builders, that’s people who custom make computers to order, will be able to offer XP until the end of the year.

Support

Microsoft will offer what it calls "mainstream support" which includes bug fixes security patches until April 14, 2009.  From 4/15/09 until 4/8/14, you’ll be able to get "extended support".   Extended  support includes security updates but no bug fixes. 

There it is, crystal clear.  There seems to be a love-hate relationship with Vista.  Some people love it.  Some people hate it.  MYOB runs on XP and we have no desire to change.  Vista may be great, but have you ever heard of any manufacturer offering "downgrade rights" on anything?  It does seem a bit odd.  It’s like selling you a 2008 Chevy but giving you the option to trade it in on a 2007.  Sounds like an admission of guilt, doesn’t it?

Small Business is Bucking Employment Trends

According to U.S. News & World Report, the National Employment Report, issued yesterday (June 4) shows that employment among small businesses (less than 50 employees) grew during May.  In fact, while total employment grew by 40,000, small business employment grew by 61,000.  Here are the details of the report:

 

Total employment +40,000
Small businesses +61,000
Medium businesses -3,000
Large businesses -18,000
Goods producing sector -37,000
Service providing sector +77,000

 

The Labor Department will release its May unemployment figures tomorrow (Friday, June 6).

Advertising

Read this.  It’s good.

Don’t Overlook the Boomers

This started out to be a statistics-heavy post.  But as I realized how boring it was to write, I knew it would be even more boring to read.  So, here’s one statistic for your consideration.  In 2008 one half of all Baby Boomers will be 50 years old or older. In other words, that’s 39 million potential customers.

For years advertisers have considered the "18-34" age group the most desirable.  This made perfect sense thirty years ago when this demographic held the lion’s share of the purchasing power.  But the 18-34s of the mid-seventies are the 48-64s of today.

These 50+ boomers are alive and well and have money to spend.  Not only that, thanks to advances in medical care, nutrition, and life style, they  don’t see themselves as "old".  There’s a HUGE market in products designed to either slow-down the aging process, or at least to make us look and feel younger.  Add the fact that thousands of boomers are turning 50 every day and you have an important market.

So what do boomers want? They want the same things they’ve always wanted, only with some modifications.  They can’t run as fast, jump as high, or see and hear as well as they once did—but they may think they can.  Our job is to help them maintain the illusion.  That means brighter lighting and bigger signs and tags in our stores.  It means giving some consideration to the music we play as background.  It means having chairs in the store.  It doesn’t mean asking a senior boomer if they want to sit down.  See the difference? 

It means sending the customer home knowing how to operate the expensive widget they just bought.  It means treating them with respect, but not as if they’re doddering senior citizens.  If you have young staff, make sure they understand that. 

The life span of the baby boom generation has coincided with some of the greatest advances in technology in human history.  (Boomers invented the PC and the Internet.)  Boomers are used to having the newest and the best.  That hasn’t changed.  You’re leaving money on the table if you assume that someone with gray hair isn’t interested in the hot new toy that just came in.

Senior boomers have more free time today than they did a few years ago.  The kids are grown.  They can afford to hire someone to do the jobs they used to do themselves.  But, don’t waste their time!  Convenience is very important to them.

Heaton_grammer
The 50+ crowd doesn’t want to feel old and they don’t want you to treat them that way.   If you’re a member of this elite group, you remember that you used to think 50 was old.  Now you think 50 is young and maybe, just maybe, 80 is old.  But we’ll check back with you in ten years. 

The bottom line is that smart manufacturers and retailers will cater to the groups who have and want to spend the most money.  And don’t forget the influence that seniors have on their adult children. A recommendation from mom or dad is about as strong an endorsement as you can get.

Here are some interesting links:

AARP

Stores.org-"Five Things You Don’t Know About Baby Boomers"

The Boomer Project

One Thousand Lessons-A Milestone of a Daily

Blogging
One of the sources that Mine Your Own Business follows closely is Doug Fleener’s "Daily Retail Experience" newsletter.  You may recognize Doug’s name because he has been quoted here many times.  His blog, "Retail Contrarian" should be daily reading for anyone in the retail business.

Doug hit a real milestone last week when "The Daily Retail Experience" number 1,000 was posted.  Trust me, it’s not easy to crank out worthwhile content every single day!  To do it for 1,000 consecutive days is amazing

In issue 1,000 he talks about the 1,000 lessons he’s learned.  (You may recall that MYOB recently passed 500 posts, meaning that Doug is at least twice as smart as your humble blogger.)  Among other things, he’s learned to do what ever’s needed, whether you want to or not.  He’s learned that learning equals growing.  He’s learned, as I have, that some of the best business lessons happen outside of business.

He also points out that you must be passionate about your subject.  Trying to write every single day about something you either don’t know or don’t care about would be deadly dull and it would show in the content.

Finally, Doug says you can’t over-communicate the basics.  A writer wants to come up with something exciting and new every day.  But, without a foundation of the basics, the rest is just window dressing.  He says, "But then all I have to do is go shop some stores at the mall and I’m reminded
stores win or lose on the basics.  You can never, ever, over-communicate to your
staff about the basics."

I would apply these same truths to anyone in the world of business.  You have to be constantly learning, and the learning often comes from the most unexpected places, if you’re looking for it.  Every activity, every interaction, every conversation may contain the seed of a great business idea…. if you have the radar turned on.

Congratulations to Doug for the first 1,000 newsletters!
 
To paraphrase what he wrote when MYOB hit number 500, "Doug, you don’t look a day over 900!"  And thanks for sharing what you’ve learned.