Written by Allison Herrera
CNN Business wrote an article back in February (click here & read it) on how TJ Maxx hopes customers will “revenge shop” in hopes of making up for business lost over the past year from Covid-19. TJX (TJX), the owner of discount chains TJ Maxx & Marshalls, said Wednesday that sales at stores in the United States open for at least a year dropped 7% during the 13 weeks ending January 30 compared with the same stretch last year.
Crazy, right? But, wait…what is “revenge shopping”? The article quotes that revenge shopping is a, “theory that once the pandemic is over, people will go out and spend loads as revenge for being restricted from so long”. This theory is proposed by Neil Saunders, managing director at GlobalData Retail. Saunders also believes that as people return eating out for dinner, traveling & returning to work, shoppers may invest more money in clothes for these occasions. The article explains that…
- This is already playing out in China, where Saunders says there has been a surge in spending on luxury items. The trend helped create an uptick in sales last spring for several companies, such as Tiffany & Burberry.
- The National Retail Federation forecasts retail sales to grow between 6.5% and 8.2% to more than $4.3 trillion this year. The group says that would mark the fastest growth since 2004.
- “We are very optimistic,” NRF CEO Matthew Shay said in a news release. “Healthy consumer fundamentals, pent-up demand, and widespread distribution of the vaccine will generate increased economic growth, retail sales and consumer spending.”
So, what do we think about these predictions?
Remember the “Roaring 20s” – the explosion of lavish after WWI, the pandemic & economic slump The main reasons for America’s economic boom in the 1920s were technological progress; which led to the mass production of goods, the electrification of America, new mass marketing techniques, the availability of cheap credit & increased employment which, in turn, created a huge amount of consumers. I think this article is on to something in terms of predictions. History has a way of repeating itself – especially economic cycles. I think this pattern of technological progress, mass production of goods, new mass marketing techniques (*sough* TikTok *cough*), the availability of cheap credit (which we already see) & increased employment is potentially reflective for 2021.
This pandemic has restricted many people’s way of life, & stripped the need or ability for luxury items. We wouldn’t term this predicted economic boom for product wants as “revenge shopping”, but perhaps refer to it as “revitalized shopping”. As our “new normal” conforms into a version that feels like pre-pandemic, yet still focuses on safety, people are now celebrating life & vitality. We believe shopping will re-energize our economy by reinvigorating the idea of celebration, a state of great comfort & will glamorize extravagant living once more.
What does this mean for you? This is a free-market economy, babe, & only the best of the best will survive. Let’s up your marketing game, because this economy will only let the fit survive…one thing we learned from quarantine was digital is the king of sales & your business is only as strong as your marketing is. Let’s chat today, so we can get your sales & branding back on top, as more people are looking for ways to spend their money. Let’s show them why they need (not want) your products/services.