Recession Insights From Zeller’s CEO

I just read an interesting article about Mark Foote, CEO of the Canadian retailer Zellers. Since Zellers is a discounter, the down economy is helping its business. But Foote isn’t just sitting back and pegging his company’s growth on the recession. Here are several things that he’s working on:

• Lowering the prices on 250 key items from paper towels to ironing boards
• Designing in-store displays and signage to more actively communicate price savings
• Putting more focus on its higher-margin apparel category with products that mimic upscale brands like Lululemon
• Pruning up to 25% of the inventory to concentrate on the products that are most important for its target shoppers: “mom and her kids.”
• Looking for ways to more radically change the Zeller store experience in the future

According to Foote:

A new Zellers store would stop them in the first few feet and give them a moment of pause. A great new store builds on but changes the character of the brand.

My take: Foote’s actions highlight the importance of four questions that every senior executive should be asking in the midst of this economic downturn:

1. What’s our core value proposition and how does it translate in this economic environment?
2. How can we more aggressively tailor products, services, and experiences to meet the needs of our most important customers?
3. How can we deliver more value and make sure customers recognize that value?
4. Despite the focus on tactics in an economic downturn, how can we maintain progress on our long-term strategies?

The bottom line: Navigating through a recession takes active leadership