Accessories are famous for their ability to boost margins and retain customer interest. In fact, consumer appeal in accessories shows no signs of slowing down – with the National Retail Federation reporting that jewelry was at the top of customers’ holiday wish lists in 2017. Yet despite most retailers being aware that adding accessories to their store can help them increase profits, there is often confusion about which items are the biggest money-makers in the category of accessories – as well as what factors to consider when they’re ready to invest in this important area of inventory.
To help bring clarity to these questions, consider the below three factors.
#1: Accessories Cross Many Categories of Inventory
The “accessories” category encompasses a broad range of goods — from umbrellas to rings to belts to wallets and more. By definition, accessories is a general term and can be used to reference many different types of products – often confusing merchants who mistake accessories as impulse buys versus substantial product categories for their stores. Considering this, it’s important to review the various items that fall into the accessories category and identify which are most likely to sell out and increase profits for your one-of-a-kind business.
According to a recent study by Statista, fashion costume jewelry sales significantly trump all other women’s accessory category sales, with 20.4 billion dollars worth of costume jewelry sold in 2016. The second leading category is handbags (9.7 billion), followed by hosiery (3.1 billion), sunglasses (1.9 billion) and small leather goods (1.8 billion). In addition, Shopify reports that over 1.2 billion watches are sold annually, posing an opportunity for retailers to boost margins selling accessories for men – not just women – as well.
#2: Accessories Introduce Longer Shelve Life
One of the primary benefits of selling accessories is that they have a much longer lifespan than apparel, seasonal home goods and other inventory categories that have expiration dates clearly attached to them. Instead of expiring within a specific time from – such as trendy apparel does or time-sensitive cosmetics – many accessories stay desirable for multiple seasons. In fact, the Business of Fashion reports that 70 percent of apparel is discounted, compared with 37 percent of shoes and 31 percent of handbags. This reason alone proves that accessories such as fashion jewelry, shoes and handbags are great options to buy for your retail business – extending shelve life and offering strong margins along the way, as well. This is mostly due to retailers turning stronger profits on accessories due to their decreased need for markdowns. Furthermore, many accessories – such as low-priced fashion jewelry bought in bulk – can be high margin items. Retailers have the opportunity to significantly mark up the price on quality pieces and can make up to 500 percent the price in profit – a winning scenario for retailers selling to all consumers.
#3: Accessories Incorporate the Power of Touch to Consumers
It’s one thing to introduce accessories to your store… it’s another thing to merchandise them so that they become an engaging component to your customer experience. The question remains, however, how can retailers make this happen?
First and foremost, encourage customers to get hands-on with products. Whether a retailer is selling a $10 handbag or a $500 pair of earrings, a company’s sell-through rate will increase when employing a sensory marketing initiative. In fact, Fast Company reports that of the five senses, touch leads the way in selling products which are “…physically close to the customer, or for purchases made right now. In addition, when advertising products consumers may buy for a close friend, touch (and taste) will help sell the product better.” Keeping this in mind, train your associates to encourage a tactile experience by inviting customers to engage with any and all accessories. Incorporate mirrors into your merchandising, create inviting dressing rooms for customers to enjoy and use your accessories through-out store displays to help drum up consumer, hands-on experiences… and sales!
Finally, for retailers who want to invest in high-margin products with a minimal risk of discounting, expanding your accessories selection might just be the answer. To explore accessories vendors right for your store, attend ASD Market Week in Las Vegas from March 11-14, 2018. Register for free here!
Take advantage of ASD Market Week’s 90+ free retail strategy sessions this March 11-14, 2018 in Las Vegas.
By Nicole Leinbach Reyhle, RetailMinded.com