Surgical Shopping and the Hangover Market

Last holiday season I coined the term “surgical shopping” to describe the highly precise way many consumers were purchasing.  While the panic of late 2008 and early 2009 subsided, consumers were only gradually opening their wallets, focusing primarily on needs vs. wants and often trading down to brands that gave very clear bang for the buck.  By the time the numbers were in for the 4th quarter, it was clear that business was better, but not particularly good.

As an economic recovery struggles to gain traction, this “surgical shopping” behavior remains rampant, and in my opinion is not likely to change any time soon.

This behavior is evident on the lower end of the market, as private labels (or more accurately “private brands”) gain market share.  And it’s apparent on the higher end, as accessible luxury brands such as Coach, Nordstrom and J. Crew beat their more exclusive and expensive rivals.  Even at the absolute luxury tier, brands like Louis Vuitton, Gucci and Hermes outpace the competition as they emphasize their heritage of investment quality craftsmanship to win over flash in the pan, mostly pure image brands.

This is now the Hangover Market.  Waking from the intoxication of too much marketing and societal hooch, consumers are now shaking off the cobwebs and dry mouth of excessive, superficial spending.   And while it’s always difficult to predict future consumer behavior, many consumers are not going back to their old reckless spending habits.  For some, this will be out of economic necessity.  For others, this will be values based, as they become more discerning about the quantity of what they buy and the price they pay for certain items.

So what does this mean for business leaders and brand stewards?

Tangible, obvious value wins.

Craftsmanship wins.

Authentic wins.

Experience wins.

Connectedness wins.

Being remarkable wins.

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Author: stevenpdennis

Steven Dennis is a trusted advisor and thought-leader on customer-centric strategic growth and innovation. As President of SageBerry Consulting, he applies his C-level executive experience to drive growth and marketing strategy for multi-channel retail, e-commerce and luxury industry clients. He shares his ideas and wisdom regularly in the press, as an industry speaker and through his popular blog "Zen and the Art & Science of Customer-Centricity"(https://stevenpdennis.wordpress.com/). Prior to founding SageBerry, Steven was Senior Vice President of Strategy, Business Development and Marketing for the Neiman Marcus Group. As a member of the Executive Committee he drove the company's major growth initiatives, multi-channel marketing programs and customer insight agenda. Before joining Neiman Marcus, Steven held leadership positions with Sears, including Acting Chief Strategy Officer, Lands' End acquisition integration team leader, Vice President-Multichannel Integration and General Manager-Commercial Sales. Earlier in his career he was with NutraSweet and the global management strategy consulting firm, Booz & Co. Steven received his MBA from the Harvard Business School and a BA from Tufts University. In addition to his consulting work, Steven is an executive-in-residence at the JC Penney Center for Retail Excellence at SMU’s Cox School of Business, President of the DFW Retail Executives Association and serves on the Advisory Boards of Invodo Inc. and Nectar Online Media. He is also active in the social innovation and education reform arena as a Partner and member of the Board of Directors of Dallas Social Venture Partners. He is currently co-leader of DSVP's investment and engagement with SMU's Center on Communities and Education "School Zone" initiative in West Dallas.

1 thought on “Surgical Shopping and the Hangover Market”

  1. Steve,

    I believe you to be ‘right on’ with your remarks and study of the most current economic trends of late. People continue to have the desire to shop and spend their discretionary income. However, they want do acquire more (as you stated in so many words) “bang for their buck”. I see the situation taking a horrible turn for the worse in terms of the manufacturing / supply. This is where the ‘rubber meets the road” and quality is IMHO the first thing to decline. It’s sad but true. I wonder how all of this will play out? I for one will take less (quantity) if it means I get more / better (quality).

    Like

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