Thursday, March 21, 2013

FOOTSTEPS



One less set of footsteps on the floor go the words of an old Jim Croce song.

Croce was singing about breaking up with his significant other, something consumers often do with significant brands.

In business jargon that translates into every retailers' worse nightmare, fewer footprints. Whether its bricks and mortar or e-retailers that means fewer footsteps as in customers.

Since customers buy things they affect other things like inventory, less turnover means more shelf time or inventory pile-ups, not what any merchant hoping to make a decent profit wants.

So how does one get rid of stuff? Giving it away is probably the easiest, unless you're my old girlfriend. That took some ingenious PR work.

If you've read Jonah Berger's new best seller, "Contagious. Why Things Catch On," you'll know what I mean.

 Retailers might call it something else, dropping prices. Falling prices squeeze profit margins. It can become a vicious fire sale. If you're a bargain hunter and you like the merchandise, a retailer's hard times can be your good ones.

A case in point is once hip Aeropostale, trading today a little over 13$ a share. About this time last year ARO changed hands around $22. That brings up the well-known but usual response: What happened?

To explain we've listed a few links below.

In the meantime, forget all those bogus Black Friday sales. Look for fewer footsteps.

http://www.investorguide.com/article/12368/aeropostale-aro-crashes-as-the-brand-continues-to-deflate/

http://www.thestreet.com/story/11871046/1/aeropostale-stock-falls-on-unusually-high-volume-aro.html?puc=yahoo&cm_ven=YA

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