The Treasure Hunt Is On
It has been said that there are three keys to success in the dollar store business. The first two are well known: sell extreme value and have a convenient location. But what about the third? This element is sometimes overlooked, but it is the most controllable of the three and plays a vital role.
We’re talking about the treasure hunt experience, that intangible ‘fun factor’ that keeps customers coming back for more. Ask a customer what it is they’re looking for and they probably wouldn’t be able to say. But successful retailers understand very well just how important this part of the business is.
What we do know is that Americans love to shop. We’re a nation of impulse buyers, and dollar stores fill this need in a way that’s fun and affordable. In fact, many consumers so enjoy hunting for a bargain they won’t leave the store until they find it. “Unlike most shoppers we study, very few dollar store shoppers have a list,” says Craig Childress, Director of Research at EnviroSell, a New York firm that tracks consumer behavior. “They’re not necessarily out for particular items. They’re out for the hunt.”
One reason why high turnover and good merchandising dollar store items are important is the fact that so much of a store’s business depends on repeat shoppers. AC Nielsen reports that 83% of sales come from customers who shop more than twice a month. By constantly refreshing the merchandise, retailers are able to better serve this customer.
How do you make sure your dollar store feeds this instinct? One key is rapid turnover. Make sure you have something new every few weeks, something that’s easy to find and well displayed. The use of specials is also a great way to keep shelves fully stocked – another key to success.
Among the most popular treasure hunt dollar items are glassware, party goods, kitchen items, plastic containers, tools and picture frames. Also, a heavy rotation of seasonal and holiday dollar items adds surprise and discovery to the shopping experience.
Gift items are another growing category that adds to the treasure hunt aspect. According to Deloitte, a New York based consulting company, a high of 22% of shoppers bought Christmas gifts at dollar stores last year.
Closely related to the treasure hunt aspect is the kids’ treasure hunt. Many moms with limited entertainment budgets take their children shopping when they visit the dollar store, where they can buy an armful of toys for a few dollars. Having a steady stream of new toys to be discovered gives them something to do, which results in a grateful mother.
Ultimately, the extreme value element of marketing will always be king, because it makes the customer feel in control. But by providing a constantly changing treasure hunt experience, retailers will retain their best customers and continue the rapid growth of the dollar store industry.