Shoppers Aren’t All That Happy With Value Fashion Retailers

Source: https://www.fool.com

While the so-called retail apocalypse has caused a number of chains to either close stores or go out of business entirely, value retailers have largely bucked that trend. There are, however, clear warning signs from the data in Market Force’s annual study of value fashion retailers.

In a survey of over 10,000 consumers, the report found weakness at even the top-rated brands. That should concern an industry that faces significant pressure from digital rivals and declining mall traffic.

“Nearly half of those surveyed have shopped at a physical retail store at least three times in the past 90 days, typically to enjoy a great in-store experience and to hunt for a good sale,” said Market Force Chief Customer Officer Brad Christian in a press release. “However, it’s not always about price, even in the value apparel realm. Customers also want attentive and helpful service, and that’s one area where these discount retailers can and should bridge the gap with their premium counterparts.”

Which chains rated the highest?

T.J. Maxx, a TJX (NYSE:TJX) company, tied with Target (NYSE:TGT) for first place in this annual survey. The two companies, however, are moving in opposite directions.

Target saw the biggest gain of all fashion retailers, jumping 6 percentage points to score a 47% on Market Force’s Composite Loyalty Index. T.J. Maxx dropped by 6 percentage points to score 47%. The index ranks companies on an overall basis as well as areas including merchandise selection, customer service, and e-commerce.

Nordstrom Rack, the value division of Nordstrom (NYSE:JWN), came in just behind the two leaders at 46%, a drop from 50% in last year’s survey. Nordstrom itself was named the top premium fashion retailer in an earlier Market Force report.

The leaders were followed by Burlington at 45% with Marshall’s, another TJX company, just behind at 44%, unchanged from last year. Ross Stores (NASDAQ:ROST) followed at 42% while Walmart (NYSE:WMT) brought up the rear at a dismal 29%, although that was a 1-percentage-point improvement over the previous year.

Some troubling signs

In general, consumers did not report having very good shopping experiences. Only 42% rated their most recent experience at a physical location of their favorite fashion retailer as offering “value for money spent.” Only 31% of those surveyed said it was easy to find what they were looking for, while 38% reported being satisfied at the overall atmosphere of the store.

Retailers need to improve

There was a time when simply having convenient locations gave retailers an edge. Those days have long since passed since consumers can simply opt to skip brick-and-mortar chains and do their shopping online.

That means that even discount chains have to find ways to offer better customer service. That’s something that Target CEO Brian Cornell has actively embraced.

“We’re investing a lot in hours, staffing, training, and development and creating experts within our stores,” Cornell said in remarks reported by RetailWire. “Because we know as we listen to our guests in certain categories, they want someone there who is an expert.”

That’s a model every player in this space should consider embracing, especially as online customer service and technology improves. Fashion retailers even need to consider a future where trying on something virtually works well and people have even less reason to come into a store.

These survey results show that shoppers aren’t all that happy with even their favorite value fashion retailers. That should serve as a warning call to the entire industry to either improve or risk being driven out of business.



Categories: Apparel, Business, Retail, USA

Tags: , , , , , , ,

%d bloggers like this: