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Today’s Successful Retailers Prepare for the 1960's

Posted by Tom Lombardo | Tue, May 12, 2015 @ 09:44 AM

We associate the 1960s with the Baby Boomers, but since members of that generation were still being born in 1964, the Civil Rights, Free Speech and “give peace a chance” movements were really pushed forward by the oldest Boomers, in their teens and twenties when the last members of their generation were still in the cradle.

Demographers can’t help but compare them to today’s Millennials, mostly because both generations are huge, but there may be other similarities that can help retail owners and general managers profit from the social changes Millennials are causing.

Millennial Money vs. 1960s Money

Big Box RetailersLet’s start with money. Ever wonder who paid for the 1960s upheaval? How was it possible for millions of young people to “tune in, turn on, and drop out” without starving? In her classic 1968 essay collection, Slouching Towards Bethlehem, Joan Didion describes her visit to a hippie sanctuary in Haight Ashbury, San Francisco – about forty miles from CrossCheck’s headquarters – and provides a possible answer. 

She found idealistic young people trying to stop a war and to fight for justice by being – literally “being” – a new type of American.  That alone ignited passions, and the young people she met were under a lot of self-imposed pressure to persevere. So what did they do when things got too rough, or money got too tight? They called home, and their parents helped them out. There’s a poignant scene at the end of the documentary Woodstock, about the infamous 1969 concert in upstate New York, where wet, tired, and stranded teens line up at a phone booth to do the same.

In the absence of Jim Crow laws and the draft, Millennials have a far less contentious set of concerns. But one of them is a lot tougher today: money. If a sixties hippie’s mom or dad didn’t come through, she had an option that doesn’t work for today’s young people: she could get a minimum wage job and live off of it.

In fact, the purchasing power of the minimum wage in 1968 was $2 more than it is today, and the economy was on a tear throughout the 1960s and into the 1970s, so jobs were plentiful. Conversely, Millennials have spent the last seven years in the worst job market since the Depression and we’re still not at full employment – even at $7.25 an hour.

The Millennials have another problem the hippies didn’t: their parents can’t bail them out. Mom and dad's median income is now less than it was in 1996.  If American-style social upheaval requires a pressure valve in the form of mom’s kitchen stash, then the Millennials will be the first to transform society on their own dime.

And they know it, or seem to, so the upheavals they’re causing come in subtle, powerful shifts rather than flashes of confrontation, and two major ones are playing out right in the middle of your business.

Millennial Employment and Better Sales

You’ve probably tried to avoid thinking about the first one: wages.

When some working college students need aid in order to have enough to eat, and when two parents working full-time at the minimum wage bring in only thirty thousand dollars a year, the exact same behaviors that enabled people to be self-sufficient in the sixties no longer do. Every presidential candidate so far has identified this problem as one of the root causes of the country’s unusually long, slow climb out of the recession.  

And since retailers generate $2.6 trillion of the country’s GDP, providing one in four jobs in the process, your business stands at the crossroads.

Monster.com lists retailers that pay more than the minimum, and includes one reason why a retailer would do so by quoting Ben Cohen, co-founder of Ben & Jerry's: "There is only so much Chunky Monkey one rich guy can eat. For Ben & Jerry’s to succeed, we need more than one ice cream buying rich guy. Raise the minimum wage and everyone can have a scoop.”

There’s another reason why you might consider competing with Ben & Jerry’s self-imposed $15.97 wage. According to the most recent report by Retailwire, “Knowledgeable sales associates are more powerful – and vital to retailers’ success – than ever before.”

If more than nine out of ten customers are likely to buy when helped by a knowledgeable salesperson, then grooming your sales staff may be the quickest and most effective way to increase your profits. And once you’ve invested in someone and seen their skillful work, it might be worth it to compensate them at a level that will prevent them from looking for a job at Ben & Jerry’s. 

Millennial Revolution

There’s a Millennial angle to this, too. Retailers have always relied upon word of mouth to build their brand and increase sales, but today’s smartphone obsessed Millennial takes that to a whole new level.

Like the activists from the sixties, they’re interested in changing culture, but they seem to be choosing to use the power of their demand to reach their ends. They’re more like activist investors – people who buy a company’s stock to influence its corporate policies, a phenomenon rapidly growing in size and ferocity.

You can use this to your advantage by thinking like Joan Didion. She traveled to San Francisco, among other places, to have an experience and to find relationships. She spoke her truth through essays the way Millennials speak through Facebook and WeChat.

She cared deeply about her subjects, but she never dropped out of society. Which is probably why Céline just signed her to feature in their latest ad campaign, and why Vogue had this to say about it:

Well, did you just feel the collective intake of breath shared by every cool girl you know? Did you feel the pulse-quickening vibrations of every recent college grad and literature fan?

From a retail store owner or manager’s point of view, Vogue’s most important insight is this: “we’ll be buying whatever Joan’s wearing.”

For your store to be as cool as Joan, or Céline for that matter, you need to have what appeals to Millennials. An “authentic” shopping experience tops the list, which is something only your knowledgeable sales staff can deliver. If you try to provide one of those to everyone, you might find that the tweets and FB posts they send will net you new customers.

And beware of what you sell. It’s all well and good to wonder if the revival of 70s prints and bell bottoms is another Millennial/Hippie connection, but what matters more is the story behind what you sell.

Artisanal merchandise, especially things made locally or traded ethically, seems to be a trend growing and gathering strength. It’s an obvious extension of the Millennials’ desire for an authentic shopping experience. If they buy, they want the story about their possession to satisfy that “activist investor” sentiment.

Of course, if you put all this effort into appealing to Millennials, training your staff (and perhaps paying them better), and making sure you deliver the shopping experience of a lifetime, the last thing you want to see is a sale left behind because the customer can’t afford it.

You have a layaway program but you know that most people abandon items there, costing you in several ways. Millennials won’t run up debt on credit cards, so don’t ask.

But you can provide them with another option that many of our clients call “in-home layaway.” You get the sale, you get guaranteed revenue, and your customer doesn’t have to pay in full upfront. Click the image below to find out more.

And when you think about your business and about your customers, maybe this is the year you can leave behind the heavy thoughts from the recession and rekindle the fire of youth. To help you remember what you felt like in 2007, here’s what Didion wrote about the idealists she met:

Nothing was irrevocable; everything was within reach... I could make promises to myself and to other people and there would be all the time in the world to keep them.

 

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Topics: Retail

Written by Tom Lombardo