TJ Maxx and Target have tied for the favorite value fashion retailer in a new Market Force study. The study also looked at other areas of value fashion retail such as e-commerce, merchandise selection and customer service.
TJ Maxx and Target barely beat out Nordstrom Rack, with a score on the Composite Loyalty Index of 47%. Nordstrom Rack came in one point below, with a 46%, Burlington came in third, with 45%, and Marshalls, Ross Stores and Walmart ranked in the next three positions.
"It surprised us to see Walmart scored so low for value for money, even ranking behind Nordstrom Rack," Brad Christian, chief customer officer of Market Force, told FierceRetail. "Most consumers associate Walmart with low discounted prices, but that doesn’t automatically equate to high value in shoppers’ minds. It suggests that value perception can be impacted by a number of factors aside from price, such as the quality of apparel, the merchandising and even the shopping experience."
Burlington topped the rankings for best selection and for giving shoppers the ability to create a look. Ross topped for value for money spent. And Target scored second highest for atmosphere, ease in finding items and checkout speeds. Although TJ Maxx failed to dominate any one category, it performed consistently in every area.
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Target did rank at the top of e-commerce for the most website visits and purchases and for the best online experience. More than half, 51%, of respondents reported visiting the retailer's website in the past 90 days, and 72% of those visitors made a purchase. Walmart's and Nordstrom Rack's websites were visited by 40% of participants, and nearly two-thirds make online purchases from them.
Christian notes that value will remain consumers’ top driver in 2018, as millennials and other shoppers opt not to spend more on expensive clothes even if they have the funds. With that said, he noted that in-store service will rank almost as important when making shopping decisions.
"This is especially true with value retailers because we found very few are doing a great job at assisting shoppers and recommending items to them. Even bargain shoppers want and benefit from this higher-touch level of service, and the retailers that deliver that will see more of their loyalty," he said. "Shoppers will also be drawn into stores that have an inviting atmosphere and where they can easily find what they need, which are two areas where Target and TJ Maxx excel. Target even reported recently that its sales grew in its renovated stores by as much as 4%."
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And while technology plays an important part of creating loyal customers of the future, Christian points out that store associates will continue to play a very important role in the fashion industry, as it's been proven they accentuate the shopping experience. In fact, Christian says that those brands that reduce in-store sales help are at risk of speeding up their irrelevancy.
"Our studies have shown that both premium and value apparel retailers have room for improvement on the service side, with only 43% of shoppers reporting they were helped by store staff during their last visit, and the assistance they received was mostly finding other sizes or getting set up in a dressing room," Christian said.
"With so many online and physical options available to consumers, there’s no chance for value retailers to engender strong brand loyalty without creating a true shopping experience for them, and that’s best done through an engaged and well-trained sales staff."