Watching a story on the news about one of the latest jobs reports, the reporter spoke about how while retailers had seen greater sales (or something like that, I can't remember exactly), there hadn't been a correlating increase in retail hiring, after which he said something like, "But that doesn't make sense." Sorry, sir, but it does. It makes perfect sense. Hiring more people means paying more people, and if the stores want everyone to think that they're making money, then they can't do anything to take that money away. I also think the lack of hiring might have something to do with the fact that the reason some of these stores are selling more is because they're giving out coupons like candy, which in turn may be the reason for the increased sales and may correlate into more merchandise sold, but not necessarily more money earned when adjusted for inflation and whatnot.
Now, I'm not saying that stores should never give out coupons. What I'm saying is that coupons are like drugs, and you can't get people addicted and then take them away without consequences. Sure, coupons may get people in the door, and those people might or might not buy more because they have a coupon, but the problem is that if the store offers too many too often, they condition people to shop only when they have coupons, meaning that during those times when a coupon isn't offered, there's a decrease in store traffic. In effect the store has trapped itself by offering so many coupons because if it ever wants to cut back on the number it offers in order to make more money, there are going to be problems. Initially, customers are probably going to wait for the coupon to arrive, and when it doesn't, they're going to become angry because they've become accustomed to receiving them and now feel that it's their right to have them and how dare the store do that to them. I think this then means that there's a good chance of a backlash occurring, during which customers will either seek other stores, or make threats about how they will never shop there again, how the prices are too high, and how it just isn't fair, inevitably resulting in fewer shoppers and lower sales. If this happens, and if the store isn't strong enough, or doesn't have good enough community relations, to weather the storm, it risks going out of business because let's face it, people are only as loyal as their wallets allows them to be, and there's always another option.
Personally, I've always been leery of stores that give out too many coupons as it seems to be a tactic of last resort for a business in trouble. It also seems to be a road that can't be taken without great risk should the decision be made to turn around, and I wouldn't be surprised if there haven't been several that went too far down this road of no return and couldn't survive the backlash of a course correction. Yes, I know that times are tight (Believe me, I'm well aware of that.), but I think you have to be careful with coupons because sure, they bring on the deals, but they also lower the perceived value of the products, not that there aren't quite a few that could stand to be sold for closer to what they're actually worth, but then all of those celebrities would have to take a pay cut, and you risk another backlash when people become angry because they realize just how much extra they've been charged over the years, but that's another matter entirely...
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