Applied Marketing 101: December 2013 forecast

As I write this, I have just finished a turn at the helm of my sister’s Hylas 46, an offshore sailing vessel she and my brother-in-law recently commissioned in order to circumnavigate the globe. It is a fine yacht, appointed with all of the equipment one would expect on a sailboat built for crossing oceans, and I marvel at the fact that each of my helm watches has been spent not so much steering, but rather tending the autopilot. Computerized navigation and radar systems have rendered most elements of the traditional tasks of steering, dead reckoning, and collision avoidance irrelevant, and so on this 100 mile delivery up the Chesapeake Bay, all of us in the cockpit are really more overseers than active participants, as the boat is pretty much steering herself.

As I consider this, it seems an appropriate metaphor to use as a starting point for a discussion of what to expect this Christmas. No one has a crystal ball, but you really should be making the final appropriate moves now so that your store’s marketing and merchandising will be on “Autopilot” as you head into Christmas. Your plan will depend on the set of expectations that you have for the Season. Here are some of mine.

First, expect the whole “Vibrating Diamond” scenario to heat up very nicely. All of the majors will be doing nationwide launches over the next 60 days (in fact, by the time you read this, many of the mall stores will already have it in place), and on the independent side there are now over 20 suppliers selling this new category, so it’s probably safe to assume that your independent competitors will also have them. If you still don’t have some version of this very important new product, get it now, and have a game plan in place to advertise it, or you’ll be lost in the shuffle when everyone else’s advertising hits. And try to latch onto one of the three or four brands that will have staying power.

I encourage you to think about this the same way the ‘winners’ thought about beads. If you passed on beads, or went with one of the “also-ran” companies, then the bead phenomenon passed you by. If you selected one of the top three companies, then beads became part of the life blood of your store. And if you picked the brand that rose to the top, then you probably made a fortune, at a time when the economy was tanking. The vibrating diamond category has the potential to have a significant impact, so Don’t Miss It!

Second, recognize that you will likely experience monthly sales increases throughout the 4th quarter simply because you’re up against months that were initially deflated last year by the election, and then by sequestration. 2013 will be better than 2012 simply because it’s not 2012. Last year October was brutal, as consumer spending on discretionary items evaporated when we all became focused on the Obama/Romney Show. And then in November, affluent consumers who were generally disappointed by the election results sat on their wallets. And then finally, in December, sequestration took the wind out of the sails of affluent consumers (particularly self-employed entrepreneurs), and we all felt the effects when the big spenders didn’t spend.

So this year, with none of these negative factors occurring, you’re going to have organic sales increases. Plan for them, and be reluctant to reward your staffs too heavily for revenue expansion at modest levels. You’ll get that just for showing up. This year in the fourth quarter, aim high, because you’re going to have a chance to get some pretty large increases over the same months in 2012.

Third, expect average tickets to finally rise (and not solely because of a drop in bead units, as occurred this past spring). Last year, our customers who had sales increases (and the vast majority did) accomplished that because of significant increases in transaction counts, as average ticket purchases stayed stubbornly low. This was one of the reasons that traffic was so critically important last year, because given a consumer mind set focused on low price points, the only way to make the numbers was with tons of transactions. This time around, I think you’ll see similarly high transaction counts, but you may also finally start to see the average spend pick up. So take one last look at your inventory, and consider what you might actually need if your average retail sale goes up by 20 percent.  You may actually need to fill some holes, or you could wind up missing some (important) sales.

Fourth, expect Halos of all kinds to be smoking hot. DeBeers isn’t taking their foot off the Forevermark accelerator, and their TV advertising in December will continue to be about Halo looks. And remember, this isn’t just about engagement rings. It will also be about fashion. And given the fact that most of the vibrating diamond styles are also built with halos, you might just take a look at your diamond inventory and make sure you can weather a perfect storm built around halo styles.

Fifth, make sure your merchandising gun is loaded for sales of Personalized Jewelry. The entire category of personalization - with names - is on fire. Do not miss this trend!

Sixth, be aware that the impending expansion of Millennial shoppers in your bridal department will necessarily mean far more customization. The gals you’re going to be selling engagement rings to will definitely want it “their way,” so try to bring every element of cad/cam into play as you roll into the biggest bridal month (December). And make sure you incorporate advertising for inexpensive gifts into your overall Christmas game plan, aimed at young, potentially pre-bridal male gift givers.  Recognize that Christmas and Valentine’s Day provide you with unique opportunities to engage pre-bridal couples in an initial dialogue, which can ultimately lead to a very nice engagement ring sale during the subsequent twelve months.

Given this expectation set, I hope you’ll agree that it’s vital for you not to skimp on the advertising! December is the one time of the year when you have a chance to attract massive quantities of male gift-givers, many of whom should be new customers. Break your expenditures into two parts: one portion to attract your existing base, and a second portion to attract new customers. Remember that your goal isn’t just maximizing fourth quarter revenues. It should also be about building your base, so that as birthdays, anniversaries, and other special events occur throughout 2014, the new customers you attract this December will help fund your sales increases throughout the year.

Having a successful December requires the proper execution of your marketing and merchandising game plan. If you have the right plan, then you’ll be able to put your store on autopilot so you can focus on execution. The whole game now revolves around funding the traffic you need to get transactions, and then making sure that the products you’re carrying match up with the items that the consumers you’re attracting want to buy.

If you still haven’t finalized your plan, take this as a final wake up call. You still have time, but time is no longer your ally. And if you need the right “stuff” or you’re not sure your plan will allow you to accomplish your sales, profitability, and new customer acquisition objectives, call us. We may be able to help you get where you want to go.

Class Dismissed!

George Prout is Vice President of Sales and Marketing for Gems One Corporation, and can be reached via e-mail at This email address is being protected from spambots. You need JavaScript enabled to view it., or at Gems One’s New York office at 800-436-7787.