<\/p>\n
\n\tThe big blue wave that swept across America and put Democrats back in charge on Capitol Hill clarified the relatively rosy retail outlook for the holiday season.<\/p>\n
\n\tAnd investors were happy to have the election resolved definitively and to feel the ground that much firmer under their feet on Wednesday.<\/p>\n
\n\tThe Dow Jones Industrial Average rose 3 percent to 53,356.12 as retail stocks rallied. Among the big retail and fashion winners were Reformation Inc., up 9.4 percent to $18.41; American Eagle Outfitters Inc., 9.3 percent to $21.36; Abercrombie & Fitch Co., 8.6 percent to $171.09; Under Armour Inc., 8.6 percent to $5.58; Victoria\u2019s Secret & Co., 8.4 percent to $108.95, and Gap Inc., 8 percent to $23.75.<\/p>\n
\n\tAll year long, consumers have been feeling squeezed by inflation in general and higher gas prices in particular, a product of President Donald Trump\u2019s war with Iran.<\/p>\n
\n\tBut shoppers have held up better than many expected \u2014 and soon they might literally have some more fuel in the tank.<\/p>\n
\n\tMartin Lindstrom, founder and chairman of Lindstrom Co., a global brand and culture transformation group, said consumers are hurting and \u201cvery hesitant to believe anything.\u201d<\/p>\n
\n\tBut the vibe could change quickly.<\/p>\n
\n\tLindstrom predicted the war with Iran will end \u201cfairly quickly,\u201d loosening up the oil supply.<\/p>\n
\n\t\u201cI don\u2019t think there\u2019s any political power to continue in that game,\u201d he said. \u201cYou\u2019ll first see when the oil price goes down that people will start reconsidering whether they have money or not. The oil price is directly linked with any consumer confidence. We would see the confidence going back in the minds of the U.S. population fairly quickly.\u201d<\/p>\n
\n\tThe story is different overseas, where the dynamic around oil is starker and mistrust of the U.S. has grown after the tariff brinkmanship and combativeness of the Trump presidency.<\/p>\n
\n\t\u201cWe will be on the brink of a recession for a very long time,\u201d Lindstrom predicted. \u201cIt\u2019s happening in Europe right now. Mostly because you see issues in many of the countries, you see that people have been stretched and lost and now when they\u2019re going into the winter period,\u201d when the oil supply becomes all the more important.<\/p>\n
\n\t\u201cI think we go through a sluggish holiday season,\u201d he said. \u201cIt won\u2019t be a boom, but it won\u2019t be a disaster either. People are getting to really feel they have a little bit more oxygen. Had [the political sea-change] not happened, we would have seen a disastrous holiday season for sure.\u201d<\/p>\n
\n\tForecasts for the rest of the year in the U.S. have been relatively rosy, with experts expecting the consumer resiliency that propelled spending all year to continue to hold.<\/p>\n
\n\t\u201cOur holiday prediction was for 4 percent to 7 percent growth,\u201d said Sonia Lapinsky, leader of fashion retail at AlixPartners.<\/p>\n
\n\tWith inflation running at about 3.7 percent, that has retail sales almost stagnating at the low end. But there now might be a little extra consumer cushion.<\/p>\n
\n\t\u201cI would surmise that we might be putting ourselves in that higher end of the range, that there might be some more willingness to even spend right now because we\u2019re feeling somehow optimistic about what\u2019s going on,\u201d Lapinsky said.<\/p>\n
\n\tAfter a year that\u2019s seen credit card balances and delinquencies rise and one awful consumer confidence survey after another, shoppers could use a little optimism.<\/p>\n
\n\tBut that doesn\u2019t mean consumers are going to become any less discriminating.<\/p>\n
\n\t\u201cThey\u2019re frustrated by increases in price when they\u2019re not seeing a commensurate or even equal level of quality or definitely not an increase,\u201d Lapinsky said. \u201cWe\u2019re living in a polyester world, even though we\u2019re paying for silk and wool. Everything\u2019s a blend and synthetic and the consumer is finally caught up, is doing their own research and frustrated as heck.\u201d<\/p>\n
\n\tIn the end, getting a vote and getting a sale are not so dissimilar, making politicians the cousins of retailers.<\/p>\n
\n\tBoth have a product that they\u2019re selling and both need to get their message in front of an audience.<\/p>\n
\n\tAnd both have learned that the old ways of making that connection don\u2019t work as well as they did.<\/p>\n
\n\tMarcie Merriman, cultural anthropologist, brand strategist and founder of Ethos Innovation, said both politicians and brands have \u201ctaken for granted that they can look at demographics and segments in a traditional way \u2014 and it just doesn\u2019t apply anymore.\u201d<\/p>\n
\n\t\u201cIf you think you\u2019ve gotten loyalty of a particular group of people, or if you think you\u2019re focused on a specific segment based on a demographic, you need to look so much deeper than that at what they really want, what\u2019s really important to them, and realize that it can change in a heartbeat if you\u2019re not delivering on it,\u201d she said.<\/p>\n
\n\tThat is a sentiment backed up by the fact that most of the big comebacks in American fashion over the past decade, from Coach to Ralph Lauren to Victoria\u2019s Secret, have been based on better product, better marketing and a better understanding of what the customer wants.<\/p>\n
\n\tPoliticians, or at least the ones that are able to best capitalize on the political winds going into the tail end of Trump\u2019s presidency, hit many of the same notes.<\/p>\n
\n\t\u201cThe biggest lesson retailers can take is that it\u2019s important to talk to consumers in their own terms,\u201d said Greg Portell, lead partner, global markets at Kearney.<\/p>\n
\n\t\u201cIf you look at the winners and losers of the election, the winners were much better able to communicate in terms that the consumers can understand and on topics that they can understand. For retailers, that means being smart about their pricing. It means being smart about how they position their brand against the consumer reality.<\/p>\n
\n\t\u201cIt comes down to an honesty and a trust that is built on being forthright,\u201d Portell said. \u201cThe biggest lesson for retailers is they can\u2019t preach to consumers about something consumers don\u2019t care about. Which seems very simple, but if you look at the history of retailers, they\u2019ve gotten that wrong as many times as they\u2019ve gotten it right.\u201d<\/p>\n
\n\tLuckily, retail and politics are both worlds where there are opportunities to try to do it all a little bit better every day.<\/p>\n
\n\tCalls are growing in Washington for the country\u2019s leaders to hear the voter on the all-important topic of affordability and make adjustments.<\/p>\n
\n\t\u201cAmericans want Washington focused on making everyday life more affordable,\u201d said Matt Priest, president and chief executive officer of Footwear Distributors and Retailers of America. \u201cFamilies are paying attention to the cost of necessities, and they expect their elected leaders to deliver meaningful relief.\u201d<\/p>\n
\n\tWith Democrats taking control of the House and Senate, he said there is opportunity to put affordability at the top of the agenda, with footwear as a good place to start.<\/p>\n
\n\t\u201cEvery child heading to school, every nurse reporting for a shift, and every worker earning a paycheck needs shoes. Yet footwear remains among the most heavily taxed consumer products in America, with combined tariffs on many children\u2019s shoes reaching as high as 87.5 percent,\u201d Priest said.<\/p>\n
\n\tSteve Lamar, president and CEO of the American Apparel and Footwear Association, also pinpointed affordability as the number-one issue for voters, but said it \u201cremains to be seen\u201d if there will be true change in trade policy.<\/p>\n
\n\t\u201cIf these newly elected officials are serious about responding to the electorate\u2019s concerns, reducing tariffs on everyday essentials should be on their desks before their nameplates are,\u201d Lamar said.<\/p>\n
\n\tBut, in retail and politics, it\u2019s easier to see a destination than it is to actually get there.<\/p>\n
\n\t\u2014 With contributions from Vicki M. Young<\/p>\n
#U.S #Election #Boost #Holiday #Outlook #Consumer #Confidence<\/p>\n","protected":false},"excerpt":{"rendered":"
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