While accessories benefitted from a return to discretionary spending, Marshal Cohen of The NPD Group, Inc. cautions that future growth requires marketing to an entirely new consumer. Jeff Prine dissects the numbers
You could almost hear a gasp of relief as fourth quarter sales tallies came in from the U.S. Department of Commerce, retailer and manufacturer earnings reports and Wall Street analysts: the consumer, albeit still cautious, is spending again on discretionary items, including accessories, at retail.
“When you look at the numbers,” says Marshal Cohen, chief industry analyst at The NPD Group, Inc., “it appears that overall retail was indeed robust. But when you dissect what really sold, it’s a different picture.” For the most part, Cohen says, the increases were on big ticket items, from automobiles to consumer electronics. “Consumers spent bucks on big things, not little bucks on a lot of things.”
Except accessories, which along with footwear, fared better than apparel and other fashion categories. Accessories were more likely to be bought at regular price, avoiding price off promotions that plagued other fashion categories.
Although Cohen says “accessories business is much healthier than we’ve been lead to believe,” there’s a caveat in the growth numbers. “Yes, sunglass business grew but it was mostly due to sports sunglasses. Handbags grew but mostly due to smaller silhouettes,” Cohen says, noting that particular segments within categories fared well, bolstering the entire category. Few increases were across all classifications, pricepoints or lifestyles.
Engage Consumers in Your ‘Wheel of Contact’
One of the biggest sources of growth is the emergence of the under 35 age group, including teenagers, who have latched onto accessories, not only as fashion but also for their practicality.
White their interest in accessories may echo that of the Baby Boomers, the way they think about shopping and the way they shop is unlike any previous generation. “They pre-shop online, comparison shop with friends on Facebook or other social media, search for the best price and then maybe go into the store and check it out. Then they buy it online or through their mobile phones,” Cohen says. “They may not even go into a physical store.”
To capture this “Text Me” generation, the fashion industry must embrace a new consumer model, one Cohen calls Consumerology.
“In traditional retailing, when a consumer buys from your store, that’s it. Maybe someone asks the consumer where she bought that new pair of shoes, but essentially that’s as far as the connection goes.”
However a consumer finds your brand or retail store–from a website, advertising, social media, in-store experience–you have to be able to keep that consumer interested by including them in your “wheel of contact.” For example, encouraging them to “like” you on your Facebook page, signing them up for a phone app where they get incentives or news, or subscribe to your newsletter.
“The consumer has to be involved in every part of the equation or you’ll lose them,” Cohen says. “This holds true not only for the retailer, but for the brand or manufacturer, too. They have to be involved and engaging the consumers, too.”
Although these consumers grativate toward the latest and greatest trend, they want what they buy to be personal, too. “This generation is used to having the products they buy personalized for them. They may all want an iPhone or iPad but what programs, applications, games etc. they add to them make them their own.”
Cohen calls it “Distinct Conformity.” “I teach a class where I look out and all the students have Apple laptops. But what makes them difference are the accessories they’ve added to them.”
The same concept holds true in apparel and accessories. “They are all wearing jeans and T-shirts, it’s the accessories that give them the personal touch,” adds Cohen. That may sound familiar to those who marketed and sold to Baby Boomers, but the new generation takes personalization even further. For instance, Nike offers running shoes for which consumers can select color, fabrics, materials and emblems. And Mini Cooper lets car buys select colors/patterns/designs for everything from the roof to side mirrors without an upcharge.
Change for the Sake of Change
“That approach is a huge opportunity for accessories,” Cohen says. “When you offer a fashion watch, you don’t just give them color options on the dial and strap, but color options on the hands, bezels, closures, etc. Belt are another example, offering not just strap colors, but buckle, materials etc. much like what many Western wear retailers do. The days of putting merchandise offerings on the floor and basically saying, ‘here it is, take it or leave it’ are over.”
Similarly, merchandising must change, too. When consumers shop online–or on their smart phones–they immediately get suggestions of coordinating or similar merchandise, something that traditional segmented merchandising doesn’t accomplish.
“Showing merchandise the way it’s been shown for years is like leaving a pile of dirty clothes on the floor; evenutally you walk by and don’t pay any attention.”
Cohen points out how Saks Fifth Avenue and Bloomingdale’s moved their sunglasses to the front of their stores and sales improved. “That worked because it was an unexpected change. These days change for the sake of change resonates with consumers.”