In light of the gimmicks that are Black Friday and Cyber Monday, I have thought a lot about this -- both on the aforementioned higher, more abstract or philosophical level, but also from practical standpoints.
Some thoughts, keeping in mind my style. I like to take readers through my thought process, which is always a work in progress. I reread what I write and assess the feedback I receive obsessively. So I am always evolving and, more importantly, open to evolution of thought.
Cyber Monday sales/promotional emails: I get tons of them. And I still am. Today, for instance, several companies have emailed to tell me that "Cyber Monday" deals or savings continue. But, it's Tuesday. Gimmicks quickly lose their meaning and spell desperation when you hump them beyond their usefulness.
All deals, all of the time: I outfit myself these days, by and large, at two places: Kenneth Cole and ExOfficio. Kenneth Cole sends me multiple emails a day with sales that I apparently "can't miss." ExOfficio drops me a line, at most, three to four times a week. Sure, it's based on anecdote, but if Kenneth Cole was still public, I would shun the stock. However, I would love to see an ExOfficio IPO with Lululemon (LULU)-inspired retail stores.
Buy exclusive premium brands: Apple (AAPL) might be the best example, but it's not the only example. It doesn't do "real" sales on Black Friday. It does nothing for Cyber Monday. And it doesn't apologize for a $329, 7.9-inch tablet. iPad mini, like the rest of Apple's slate, speaks for itself.
Who else?: Under Armour (UA) emails me once a day. For the last week, including Black Friday and Cyber Monday, it sent me slight variations on the same email each day. Something relatively uninspiring like 25% off of a hoodie or something. I love that. Makes me want to buy the stock. Under Armour does not sell on price; like Apple, it sells on quality and cool. Like LULU, it's part of its core market's lifestyle. Intimately.
Aspiration: But, at the same time, Apple, LULU and UA are not completely out of reach. You don't have to be rich to own one or more of their products. They might represent splurges for some, but they're aspirational. If you're in retail today, there might not be a better word for people to use when they describe you. People want what you're selling and they save to get their hands on them. You have their discretionary spending.
The low-end: As a unit, Mitt Romney's 47% has some real power. I know Jim Cramer and Stephanie Link own Dollar General (DG) in their Action Alerts Plus Portfolio. The stock's recent addition to the S&P 500 should help drive volume buying, but, as a business, Cramer and Link like it because the majority of items DG sells are not discretionary. In other words, people on tight budgets need toilet paper and other "consumables," so they'll buy them repeatedly.
Takeaway: You can win on the both the low- and high-end. The high-end cats, when the dust settles, will buy Apple, LULU and UA products no matter what happens macroeconomically. People at all points along the spectrum will aspire to them with varying levels of reliability.
--Written by Rocco Pendola in Santa Monica, Calif.
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