The staff at fashion retailer Fat Face celebrate a double win after assessing the effects of announcing no price reductions before Christmas eve 2016.
The price reduction trend in the run-up to Christmas has, in recent years started earlier and earlier as the Black Friday and latterly the Cyber Monday hype has eaten into the seasonal profits.
Strategists at Fat Face took the bold decision to not reduce prices before Christmas eve. Statistics issued this week revealed that not only did the gamble pay off by spreading sales over the whole period, its sales value for the period increased by nearly 8% over last year.
Anthony Thompson, chief executive of Fat Face said:“This [price promise] clearly resonated positively with our customers. Our focus on improved quality, design innovation and more choice of luxury yarns, fabric and gifting was also received well, and provides the opportunity to further enhance our offering in future seasons.”
Thompson said that the introduction of the price promise caused shoppers to spend earlier. “Customers could pick things up, wrap it up and then not worry about it. We saw sales increase immediately, particularly around the November pay day,” he said.
Despite this, Fat Face recorded its record week of full price sales in the week to Christmas Eve.
The price promise was also rolled out in the US, where Black Friday originated, and it’s four stores that opened earlier this year out-performed expectations.
Thompson said that due to its success, the same price promise will be issued this year.
Fat Face entered its Boxing Day Sale with 22% less inventory than last year, which has, in turn, enabled them to launch their Spring range two weeks early.
Thompson said that 2017 would be a challenging year. “Currency devaluation, consumer uncertainty, and cost inflation. However, we remain confident that with our focus on quality, design modernity, and value for money we will remain resilient and become even stronger in a weaker market.”
The retailer introduced more high-end products for the festive period which sold well. Thompson predicted this would be a trend in the year ahead: “Customers will have less in their pocket to spend. They will be buying less but buying better.”
The original objective of the New Year sale was to clear out the residual stock left over from the Christmas period at reduced prices and to make way for the new season’s stock offering. Combined, of course, with squeezing the last few pounds out of shopper’s pockets.
The current festive season trend is to “stack it high and sell it cheap” to compete with other outlets doing the same thing. Fat Face has bucked the trend and won. Other retailers should take note and return to the classic values of quality, range, and service.