I was walking down a nice street in San Francisco where I noticed a sidewalk sign about 5 to 7 happy hours. I had to go back to check because I didn’t recall the place for eating or drinking. ‘Dog Day Care’ has happy hours daily from 5 to 7 and discounts apply. I thought for a few blocks and it made some sense to me.
Happy hour is just a period of discounts daily to draw customers in. The name is a good marketing catch but the purpose is to get extra business at the slow times even at steep discounts. That would make much sense for all retail places to have daily happy hours with good discounts. The discounts can change weekly to keep the customers from waiting till happy hour to do their shoppings.
I think the idea will work very well in the recession season for several reason. Happy hour concept is well accepted and understood culturally and people have no trouble understanding what it possibly means for a retail place. The retail and food (eat out) prices have gone up without regard for the customers in 2009. The assumption was the profit lost on quantity walk-ins is made up by raising the prices. The prices went up a great deal even for a normal year and the result is obvious by sluggish business everywhere. Every food place I know of has some kind of lower price approach to bring their menu and prices down to ‘real world’ levels. Happy hour for retail does just that. It allows some of the retail selection to be priced down a lot which makes them only reasonable for those living in the real world 2009. That allows products to move and customers to be happy and in touch with the business. There is no need to put everything on happy hour sale but enough revolving items to bring curious people in. The difference is the retail buying chain will move on and people can shop as they did without a recession.
The recession in most part means the consumer has as much money as before but not spending it as freely and the businesses sell the same products but have raised their prices to make as much money as if no recession and plenty of customers. The retail happy hour will bring price of some items down to a level that makes sense. I have a good example: I was at a $1 store looking for something they did not have but notice a pack of batteries is $1. The pack was available both in AAA and AA and had at least 18 or maybe 24 batteries in there. I cannot imagine seeing it that cheap ever because retail is priced not based on reality but on whatever the customer will pay.
One way to stimulate the economy beyond the holiday season and the sales that arrive in that season is by providing a discount opportunity all the time. Most customers are willing to buy things if time and place is right. A good window of time such as happy hour for retail will serve that purpose. The casual shoppers will try different stores of interest during that window and may find nothing or only one of the things they ever wanted but create some level of foot traffic. Part of the reason a retail or food establishment exists is to move merchandise and products. That is one objective and is of benefit to both buyer and seller. The recession has bottlenecked this route by raising prices too high and the closing of the customers’ pockets. A temporary opening will allow the products to move thus creating financial transactions for the business and the product benefits for the consumer. The consumer cannot get everything this way and some products that will always sell at retail will never be available at this discount opportunity and the business will never make high profit margins regardless of how much sales during this discount opportunity.
That still makes the event a win-win because the consumers will return indefinitely to browse and shop during the happy hour (discount window) and the business will have traffic and move slow-moving items on regular basis. Happy hour is a good idea not just for food and beverage but for all retail places whether times are slow or fast.