3 Retail Clichés for 2016

is a partner at MMG Advisors, an investment bank that specializes in retail, jewelry and fashion related mergers and acquisitions; he worked on the deal that helped bring Marchesa to Macy’s.

From his vantage point, he said he thinks the jewelers that will do well are ones with a strong bridal business and/or the right mix of brands on which they can make margins, generate a faster turn and create a point of differentiation for themselves that entices consumers to come into their store.

The stores that will continue to struggle, he said, will be the ones that are price-point driven, because they are just never going to beat the Internet at that game.

2. Retailers will remain “cautiously optimistic.”
I thought the proliferation of retail CEOs describing themselves as “cautiously optimistic” was a by-product of the most recent recession but Feller, who has been working in retail for well over 25 years, said he can’t remember a time when retailers weren’t this way.

And this year, “That trend will continue for sure,” he said.

There are different pressures and challenges in retail each year.

The squeeze on margins applied by the deflationary retail environment and the ever-increasing expectations of consumers will continue to be chief among the pressures both retailers, particularly brick-and-mortar retailers, and their vendors/suppliers face in 2016.

Contributing to the continued abundance of caution in the retail sector are geopolitical concerns—look at, for example, the impact the ISIS attacks in Paris had on the luxury sector there—and the upcoming presidential election in the United States, which is going to be interesting, to say the least.

Contributing to the optimism, meanwhile, are a relatively healthy labor market in the U.S., the recovery in the housing market, wages perking up, and low gas prices and interest rates.

3. Consumers will continue to seek out “experiences, not things.”
Consumers today simply don’t want to accumulate as many material possessions, which I think is due to the attitude and behaviors of the country’s two largest demographic groups: the baby boomers and their children, the millennials.

My mother is a baby boomer and what she and my father tell my brother and I before gift-giving occasions throughout the year is this: We don’t want any more stuff. Buy us gift certificates for the restaurants we like, or the golf course we go to all the time in Florida. Clear your calendars to come on vacation with us. But, please, no more things.

Their aversion to the accumulations of more “things” is due to the fact that they still live in the same house where my brother and I grew up but are looking to downsize, preferably to a house without any stairs. I think a lot of people around their age (my mother is 68 and my father is about to turn 72) feel the same way.

The millennials, on the other hand, have come of age in the sharing economy; owning as much stuff just isn’t necessary anymore. They no longer have to buy DVDs and CDs to watch movies at home or listen to music, own a car to have access to a vehicle, or buy a wedding or formal dress for a single occasion. They can stream, share or rent them.

They are happy to take advantage of these sharing opportunities, and who can blame them? They are a generation saddled with college debt in an economy with uncertain job prospects and a shrinking middle class.

All this being said, I think jewelry holds a bit of an edge over other “things” because of its value, both sentimental and real, and this isn’t entirely lost on either generation.

When I interviewed millennials for a story in our last digital magazine, I was actually surprised at how much they appreciated fine jewelry. Still, they don’t see a ton of advertising for it, don’t have as much discretionary income as past generations, and have a lot more options when it comes to where and what they can buy.

As for the baby boomers, I will speak here with authority on the one I know most intimately, my mother.

Though she shies away from accumulating more things, I still buy her jewelry and she never objects because she knows it is a present that will mean something long after she’s gone, just like her Terrible Towel.