Discount retailer T.J. Maxx is poised to overtake Macy’s in sales.
The brand is “the most consistent, most powerful apparel retailer in the United States,” analyst Howard Davidowitz told Fortune.
T.J. Maxx, which is notoriously tight-lipped with analysts and investors, is also among the most secretive companies in the industry, Fortune’s Beth Kowitt writes.
But the company’s success comes down to one thing: creating a treasure hunt for shoppers, retail expert and author Robin Lewis writes on his website The Robin Report.
The company’s 900 merchants search the world for the best good from designers like Diane Von Furstenberg, Rag & Bone, and Versace. Once those items sell out, they’re restocked with new ones.
“The shopping experience is likened to Costco’s popular “treasure hunt,” except that instead of finding a designer brand or other unexpected item that Costco offers only once every few weeks, the thrill of the hunt — and surprise findings that delight — occurs every day in the T.J. Maxx stores,” Lewis writes.
The “treasure hunt” strategy helps T.J. Maxx in two ways.
Shoppers are more likely to spend impulsively when they know the item might not be available again.
They’re also compelled to come back to see what new products are in stores.
T.J. Maxx is more like fast-fashion retailers than department stores, according to Lewis.
“Because it is not buying full lines, its merchandise flow is similar to the fast-fashion giants Zara and H&M, introducing new merchandise, brands, styles and fashion at least once a week, rather than every month,” he writes. “Scarcity is built into the process, compelling consumers to visit more often to hunt for what’s new, and when finding it, to buy it, since it will probably be gone in a day or two.”
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