Newspaper article THE JOURNAL RECORD

Frugal Family to Change Retail Marketing Trends in '90S

Newspaper article THE JOURNAL RECORD

Frugal Family to Change Retail Marketing Trends in '90S

Article excerpt

The "frugal family of the 1990s" will change the face of retail marketing, according to a University of Oklahoma researcher who predicts slow income growth will cause millions of Americans to struggle to maintain lifestyles they became accustomed to in the decades following World War II.

Jack Kasulis, associate professor of business administration at OU, points to four "key coping strategies" - wives working, fewer children, increased credit and bargain shopping - as solutions which came of age in the 1970s and '80s, and have been stretched to the limit in many families.

"The post-World War II prosperity gave way to a new set of circumstances where it is not as easy as it once was to succeed," Kasulis said. "Therefore, it is more difficult for Americans to retain their standard of living."

Studies show this trend is hardest on families, and the retail marketers who focus on family frugality will stand the best chance for success, Kasulis said.

He identified four trends he expects to gain momentum in the 1990s:

- Sales promotions, including rebate offers, coupons, sweepstakes and other consumer targeting tactics, will play an expanding role, as mass-media advertising budgets are cut.

- Nonstore buying, including catalog orders, television shopping and home-delivery by local merchants, will account for up to one-third of all retail sales by 1995.

- Non-traditional buyers will become a powerful force, as teen-agers and fathers are entrusted with more of the routine shopping responsibilities. More women will shop for things like hardware and auto parts. Financially secure grandparents will fill some gaps for their extended families, contributing the time and money their offspring increasingly lack.

- The "high-velocity, limited-assortment" store will spread to more and more product lines. Presently, Pit Stop USA and other narrowly focused retail and service businesses are enjoying success by generating large volumes through a specific niche.

Kasulis cites the Connecticut-based chain of Stew Leonard stores.

"The Stew Leonard shopper patronizes his or her regular supermarket for regular purchases, but periodically shops at Stew Leonard's to stock up on non-perishable items," Kasulis wrote in a paper presented Aug. 7 in a marketing educators conference in Washington, D.C.

Kasulis said on a recent Sunday in Connecticut, he observed a Stew Leonard store with "23 check-out stands, and two full carts at every one. That gives you an idea of the volume."

Because supermarkets continously operate near break-even thresholds, the introduction of a Stew Leonard-type of high-velocity operation in the Oklahoma City market would shake up the grocery business citywide.

"The advent of such a concept in new markets will cause a re-shuffling, and have a dramatic impact on what the local retail structure looks like," Kasulis said. "It will happen, and we will see a re-shuffling of merchandise mixes."

He points to the convenience store, fast-food and gasoline service station businesses, which have blurred the strong distinctions which once separated them. …

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