IMRA show illustrates vitality of discounting - International Mass Retail Association

Discount Store News, June 1, 1992

ORLANDO -- The $170 billion mass retail industry has led the economy's recovery, according to President George Bush who spoke to the more than 2,000 retailers, manufacturers and associated industry guests at the annual convention of the International Mass Retail Association here May 19.

Bush, who appeared via a video hook-up at the end of the four-day convention, introduced guest speaker General Norman Schwarzkopf, who gave a rousing speech on leadership skills.

Highlights of the convention included: * The release of a new study on consumer buying behavior that found, among other things, that personal responsibilities have more influence over a consumer's shopping behavior than his or her gender; * Partnership is still an important goal of the retailer/vendor relationship, but industry execs are widely split on the degree to which their counterparts are truly committed to such a relationship; * Micromarketing, i.e., adapting individual stores to meet shoppers' specific needs, is gaining currency as the "cookie-cutter" approach to merchandising becomes outmoded; * Interest, and concern, over retailers' extended use of private labels, at the expense of facing for national brands.

Generally, attendees at the convention were upbeat, expressing more than the usual degree of "cautious optimism." On the eve of the convention, most discount store chains were reporting double-digit percentage sales gains for the month of April, with many also posting 10% or more comp-store figures.

However, Bob Buchanan, principal, Alex. Brown & Sons, cautioned retailers not to get too excited. In a general session entitled, "Mass Retailing in the '90s--A Critical Analysis," Buchanan said, "January and February both started strong," but he believes it was a "false start." Buchanan estimated there will be 1% to 2% real growth in consumer spending this year, compared to a 1% decline last year.

Moderator John McLaughlin, host of the McLaughlin Group, noted that consumer confidence was up 8% in April, retail sales were up during three of the past four months, and the trade deficit was down.

Janet Mangano, vice president, Burnham Securities, predicted modest growth this year due to strength in the consumer market, but due more to the purchase of services than products.

On the manufacturer side, business appears equally improved. Vidal Sassoon appliances is "running well ahead of last year," said Bill McCorvey, senior vp, and Tony Taggart of Seymour ironing goods called the current year ending June 30 "the best year we've ever had."

Robert Verdisco, completing his first year as IMRA's president, attributed the increased attendance to IMRA's ability to expand its appeal to home center chains and warehouse clubs, among other types of specialty discount formats.

The absence of Kmart, which resigned from IMRA this year, was more than replaced by first-time attendees from BrandsMart U.S.A., Computer City, Conway, Everything's A Dollar, Grandpa's Leedmark, Lowe's, Phar-Mor (registered but not seen on the merchandise show floor), Warehouse Club, and Wholesale Depot.

IMRA's 1992 Consumer Research Study, conducted by Deloitte & Touche/TRADE Retail and Distribution Services Group and entitled, "Stop, Look & Buy . . . Where & Why," outlined the various shopper groups, merchandise selection, advertising vehicles, store layout, and price strategies that work best for each.

Shopping behavior, the study noted, is driven by time, availability and for whom the person is shopping--for themselves or for their children. However, prime motivators continue to be low price and selection, although each shopper group now reacts differently to the five key shopping motivators of low price, selection, location, quality and in-stock position.

The survey, based on 1,006 phone interviews, identified four primary shopper groups: working shoppers without children (38%) working shoppers with children (34%); homemakers (10%); and retirees (12%, but growing).

Study highlights include: * 73% of mass market shoppers are female; * 70 are employed; * 59% are married; * Food is the mostly frequently planned purchase; * Mass market outlets are the stores of choice followed by food and department stores.

Reaction to the study was somewhat mixed. Many thought the report was insightful, while others said they expected more answers to critical problems of how to appeal to a broader spectrum of customers.

The emphasis on partnership, begun at last year's convention, continued with the presentation of IMRA's Associate Member Committee's Partnership Award to Venture chairman Julian Seeherman.

"The first thing that's important is to have partnership yourself," said Seeherman, who attributed Venture's success to having "others help us. We work with each other to a common goal."

Interviewed by DSN on the convention floor, Jack Shewmaker, former Wal-Mart vice chairman and now an independent consultant, described partnership as a crucial ingredient for retailers who hope to respond to the challenging business landscape of the 1990s. However, Richard Kronrad, president of jewelry supplier, AAi, pointed out that not all retailers take partnership seriously enough. "They have to take the word partnership seriously and not just put the burden on the supplier," said Kronrad.