June Retail Sales - What If They Gave A Recession And Nobody Covered It?

The New York Times today reported that retail sales at stores open at least a year, rose higher than expected in June. Analysts were shocked that consumers were even less tightfisted with their stimulus checks in June than in May.

Again, oh my gosh – the sky isn’t falling! Just because CNN and the rest of the media can’t put the big red R on the news, and the oil prices continue to bubble upwards and the stock market remains a roller coaster  - people are still shopping.

What would happen if we had a recession and nobody covered it? Would it still happen?

Business owners must be careful to not let the “Sky is falling” phenomenon sweeping the news contaminate their own thinking about their business.

Here are some of the numbers. June same-store sales at Target increased more moderately, 0.4 percent.  Costco Wholesale Corporation’s same-store sales rose 5 percent, excluding fuel.  Kohl’s same-store sales increased 2.3 percent.

Unfortunately, Limited Brands, which includes Victoria’s Secret and Bath & Body Works, said same-store sales decreased 9 percent.  Nordstrom’s same-store sales decreased 18.6 percent, with the shift of its “half-yearly sale” into May. Neiman Marcus same-store sales decreased 2.8 percent.

Victoria’s Secret, even with those lagging sales, announced in Advertising Age that they are expanding the success of its Pink Label, to include a Collegiate Collection of licensed products rooting for the University of Michigan, Texas A&M, and Harvard—to name a few of the 33 universities.

In addition, the Collegiate Collection is taking it to the streets for promotion with a campus tour program and two to three paid brand ambassadors at each of the 15 campuses. 15,000 people are expected at Pink’s July 17 official back-to-school program, Pinkapalooza, at the Santa Monica Pier. To up the ante, the event will feature competitions between rivals USC and UCLA, and a concert performance by Fall Out Boy.

The problem with many retailers today is the employees don’t wear the clothes the store carries, robbing the stores of the chance to literally sell the clothes of their back. Victoria’s Secret’s Collegiate Collection is right on.  In the old days, we’d let things naturally work – people asking people where they purchased an item. VS paying to prime the pump is very smart. Now will we see the same attention in their stores?

With the explosion of celebrities licensing their names, it is important to not just have a pretty picture in a magazine, but also see the outfit on the backs of employees – whether that is on a college campus or in a mall.  The lesson any retailer should remember is basic – people buy more when they see it on.

And that isn’t a function of pricing or discounts.