Unpacking emotional shopping triggers
President Trump returned to Washington this week, signing a slew of executive orders and actions, several of which will impact the economy and the retail sector. We’ll take a closer look at his calls for tariffs on Canada and Mexico and his move to delay the TikTok ban, along with everything else you need to know this week, starting with takeaway’s from the National Retail Federation’s annual convention.
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Retail’s big show: NRF expo pushes storytelling, staying fresh
The National Retail Federation’s annual conference and expo last week yielded key insights for retailers via sit-down talks with keynote speakers Tracee Ellis Ross, actor, producer and founder/co-CEO of Pattern Beauty, Tommy Hilfiger and New Balance CEO and president Joe Preston. Brands founded by celebrities like Ross often rely on their star power to sell units, but Ross said her haircare line was born from her need for curly hair products and that remains the focus. For Hilfiger, the North Star was pop culture. “That was my focus, and it still is today. It’s gone beyond just music and fashion ... and it helped me carve out this journey to build this lifestyle global brand.” New Balance’s Preston said he’s “running our global offense” to ensure that the brand is presenting top-selling styles based on well-gathered research and a genuine connection with ambassadors, like Shohei Ohtani, and consumers old and young.
Why this matters: Authenticity may have been the buzzword five years ago, but what it really means is know yourself, and present your true self to your customers with storytelling. That could mean in-store events, store design or social media livestreams. (Inside Retail)
Price paranoia: Dynamic pricing = skeptical shoppers
Core inflation rate slows to 3.2%
How to compete with speedy delivery? Slow down
Apparel, accessories, footwear spending falls 3%
Glow-up: Sephora stores getting major makeover
We feel you: Why emotions matter in customer journeys
Digital business consultant Renee Ellis of Cella by Randstad Digital thinks retailers should understand the emotional triggers that drive customers to certain brands and cause them to make purchases. This way, they can better design the “customer journey” or the path from brand discovery all the way to post-purchase experience and customer lifetime value. If 95% of purchase decisions happen in the subconscious mind, retailers need to identify which emotional cues influence customers and establish a baseline customer experience tailored to their priorities (fast checkout and empathetic customer service, for example). Ellis says the future will combine psychology and technology to achieve these goals quickly and at scale.
“When emotions are amplified, brands that acknowledge and respond to their customers' heightened sensitivities — whether through compassionate communication, relevant product offerings or clear advocacy for shared values — stand out as reliable and trustworthy." - Renee Ellis, Cella by Randstad Digital
Why this matters: No matter how much AI there is, customers are humans and humans have emotions. Playing to these emotions through customer service, customer experience, merchandising and brand values pays off.
Read Renee's column here.
Trump signs order pausing TikTok ban for 75 days
On Monday the president issued an executive order directing the Attorney General not to enforce the ban on TikTok, upheld by the U.S. Supreme Court, for 75 days. During this time, the Department of Justice can take no action to enforce the law or impose penalties for non-compliance. Trump also said Monday that he’s considering a deal in which the U.S. would get half the company and Chinese parent company ByteDance would keep half. Meanwhile, the current law states that Trump must satisfy a “qualified divestiture,” which means making sure it’s impossible for China to control TikTok’s algorithm and data sharing. The law also bars Trump from allowing a Chinese entity to be involved with TikTok, even through an agreement with a U.S. company.
Why this matters: All the businesses and creators who’ve come to depend on TikTok for sales and their livelihoods can exhale for 75 days. But the ban was put in place because of security concerns, which could become a real problem if China maintains partial ownership of the platform. (Axios)
Trump threatens 25% tariffs on Canada, Mexico by Feb. 1
Echoing his campaign promise, the President said in an Oval Office signing ceremony on Monday evening that the new administration will impose 25% tariffs on Mexico and Canada on February 1. This shift in North American trade policy could increase prices for American consumers and likely will raise the prospect that the two countries impose retaliatory tariffs on U.S. goods, potentially hurting domestic businesses. Trump outlined his broader trade policy in an executive action Monday, but it doesn’t put into place the global tariffs that Trump promised on Day One. Regarding tariffs on China, Trump noted extensive tariffs he imposed during his first administration were still in effect, and on universal tariffs, he said, “We may, but we’re not ready for that just yet.”
Why this matters: The executive action signed Monday also directs the secretaries of Commerce and Treasury and the United States Trade Representative to analyze how the U.S.-Mexico-Canada trade agreement signed by Trump in his first term is affecting American workers and businesses — and whether America should remain in the free trade agreement. While the intent may be to protect U.S. businesses, one analyst said tariffs “would create a self-inflicted wound on America’s own economy.” (CNN)
What we’re reading: Big Box USA: The Environmental Impact of America’s Biggest Retail Stores (University of Wyoming Press), a collection of essays addressing the ways American retail institutions have affected physical and cultural ecologies around the world.
What we’re watching: Yahoo Finance host Brad Smith’s Top 4 Takeaways from last week’s NRF conference, in under 4 minutes.
What we’re listening to: The Glossy Podcast’s latest episode features Mack Weldon founder Brian Berger talking about the importance of flexibility, the ways he’s navigated the mens’ DTC brand through a challenging few years and its first big TV marketing spot.
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The SKUpe is curated and written by Marcy Medina and edited by Bianca Prieto
