Jessica Gardner Reporter

Jessica covers Australia's technology start-up scene, writing on breaking news and trends in entrepreneurialism, media and marketing. She was previously named Australia's best New IT Journalist for 2011.

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No strength in the sales

Published 10 January 2012 10:22, Updated 19 January 2012 05:20

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It wasn’t bang on Boxing Day, but I did hit the post-Christmas sales this year. For the good of the economy, I braved the crowds at David Jones in Sydney’s CBD to pick up some discounted work clothes (boring) and new sheets from Bed Bath N’ Table (snore).

Like always, the queues for the fitting rooms were horrendous and the clothes were all askew, but the discounts were pretty good and I came away with a few bargains. But my view is not shared by all, especially my younger Generation Y siblings.

“Nope,” was my 21-year-old sister’s answer when I asked her if she found anything decent on Boxing Day on the Sunshine Coast in Queensland. Why? “The sales weren’t that great. They were just like normal sales during the year.”

If that’s not a warning to retailers to wean themselves off the discount bandwagon, I don’t know what is.

But then again, I recently learned that department store Myer and outdoor adventure retailer Kathmandu opened up their Boxing Day sales to a selection of customers before Christmas. Apart from being miffed I didn’t hear about this, I’m worried for the retailers. It feels to me that the only tool they believe they have left is discounting.

Kathmandu’s email to loyal customers about its early sale came one day before the retailer announced a first-half earnings downgrade due to weaker than expected sales in the lead-up to Christmas. Kathmandu was the third retailer to warn of a substantial slowdown in sales, following consumer electronics chain JB Hi-Fi and surfwear brand Billabong.

The latest figures from the Australian Bureau of Statistics for November 2011, released yesterday, echo this sentiment. Seasonally adjusted figures show that retail sales are flat compared with the same month in 2010. Looking at specific categories, expenditure in cafes, restaurants and takeaway food outlets rose 0.1 per cent, while clothing, footwear and personal accessories fell 0.4 per cent.

To open up their sales early makes Myer and Kathmandu look desperate and lacking in any other imaginative ways to get customers spending. I also believe it’s causing discount-fatigue among shoppers. I can’t remember the last full-price item I purchased.

The tactic by Myer and Kathmandu to bring Boxing Day sales forward certainly isn’t popular with veteran retailer Gerry Harvey. In an interview with me on the day after Boxing Day, Harvey called the move “unnecessary” and bad for credibility.

“If you have a Boxing Day sale and you bring it forward, then it’s not a Boxing Day sale,” he said. “Consumers will think ‘What the hell is going on?’”

In the long term, such strategies will hurt retailers, he said. “You can’t be on sale everyday. People then don’t take any notice of the sales.”

I couldn’t agree more.

Do you agree? Write and tell me your views.

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