New York—The lack of innovation is the single biggest lost opportunity among retailers today. That was the consensus of a panel of Wall Street analysts during a Jan. 13 session at the National Retail Federation Conference and Exposition.
Panelist Angela Selden, North American managing partner for Accenture’s Retail Industry Group, said that a consumer survey the consulting firm conducted last year showed that consumers aren’t averse to paying higher prices “as long as there’s something to buy.” But retailers, she said, have been sacrificing long-term growth for short-term earnings—in part by sticking with the tried-and-true, which many buyers are tiring of.
Marketers “need to unleash latent customer demand,” Sson said. “That’s what Wall Street wants.” She cited Williams-Sonoma as an example of expert innovation. She pointed to Williams-Sonoma’s goal of outfitting every room of consumers’ homes through its assorted catalogs and stores. She also praised the company’s tactic of testing new properties as Pottery Barn Kids and West Elm via catalog and Internet before rolling out stores.
In assessing the state of retail and the U.S. economy for 2003, other panelists had low expectations for the first half of the year but were bullish on the second half. “Consumers are still in good shape financially,” pointed out Diane Swonk, director of economics/chief economist/senior vice president for Bank One. “They’re still in the black, and as interest rates rise, they won’t be squeezed.”
Swonk said that low consumer confidence “isn’t representing what consumers are willing to spend. Once this ‘Iraqnophobia’ passes, consumers will be ready to spend and invest.”