Coming off the brightest Christmas season since 1988, retailers might be forgiven for basking in their sunny sales results.
Yet the mood in retailing is anything but relaxed as industry leaders prepare for an annual appraisal and assessment of the future.The message to store operators gathering at this week's National Retail Federation's Convention is that the industry can't afford to be complacent and must keep pace with the changing technological tools of their trade.
Despite relief over the end of the economic recession, retailers don't foresee a windfall of consumer dollars like in the free-spending '80s.
"We don't have the go-go years. We don't have inflation. We don't have consumers out there spending money to feel good," said John J. Schultz, president and executive director of the retail federation. "We have a conservative public driven mainly by their confidence in the economy."
Underscoring those points, a study that will be released at the convention shows customers of the '90s have a more demanding attitude toward shopping, partly because the task of buying things has to compete with so many other demands on their time, energy and money.
The proliferation of shopping choices - from sprawling warehouse clubs to specialty boutiques - has contributed to this demanding attitude and made people extra discriminating about where they go for what, the study found.
Not surprisingly, the study commissioned by MasterCard International for the federation indicates shopping has lost some of its allure. It's now the nation's second - not first - favorite pastime. Dining out has bumped shopping from first place in the ways people reward themselves, according to the study conducted by Mimi Lieber and Yankelovich Partners Inc.
Mindful of such findings, retailers aren't wasting much time patting themselves on the back for a job well-done during the Christmas season. Instead, store operators are scrambling to be in good positions to grab market share from their rivals.
As they position themselves, stores still rely on some time-tested principles of successful retailing updated with modern methods.
Above all else, retailers must have what customers want, when they want it, or they won't make a sale. That sounds simple but any retailer who has misjudged a fashion trend knows it isn't.
Veteran retail analyst Edward Johnson says only retailers who incorporate state-of-the-art technology into their operations can expect to stay on the cutting edge.
Take computerized inventory control. It allows stores to keep close tabs on what's hot and what's not and react quickly to buying patterns. It speeds up the process of reordering fast-selling hits and canceling orders for proven duds.
Before computers were common in retailing, Johnson said stores had to employ "too many men in eyeshades" tediously counting inventory to deduce what was selling.
Johnson, director of the Johnson Redbook Service, a publication of Lynch, Jones & Ryan, a New York brokerage that monitors the performance of retail companies, said technology holds labor costs down in one of the most labor-intensive industries there is. Cutting overhead costs is crucial for retailers who increasingly must battle for business by slashing prices to the bone.
Competing on the price front is especially important now that "reverse snob appeal" is motivating shoppers, Johnson said. In shopping, the "In" thing is finding quality merchandise at the lowest possible price. Buying pricey, name-brand merchandise just for the sake of the label is out, with a capital "O."
Visitors to the federation's 82nd Convention and Expo in New York will have little doubt about the emphasis the industry places on technology. Besides numerous sessions at which experts will talk about the topic, the Expo itself is built largely around technology.
The events begin Sunday and run through Wednesday.
As for this year, retailers armed with good information about what's moving off the sales floor undoubtedly will discover a marked change in tastes.
For one thing, the popularity of blue jeans and other commodity-type apparel seems to be fading. Denim and glorified T-shirts - a la The Gap Inc. - are being shed in favor of more fashion-oriented items, some analysts say.
This shift was foreshadowed in The Gap's subpar holiday performance. After routinely chalking up double-digit sales gains during the recession, The Gap eked out only a 5 percent December increase at stores open at least a year.
Jackie Bivins, a retail marketing specialist at the Coopers & Lybrand consulting firm, said years of collecting commodity clothing have left weekend wardrobes ample for the time being: "How many pairs of blue jeans do we need?"