Welcome to this week's retail round up of news.

Toy sales resilient, but mums worried about cost of Christmas

We are in an economic downturn. But that doesn’t mean we aren’t going to cut down on toy purchases for our kids. Although value of toy sales in the UK dipped about 1% to £568m between January and May this year, it has risen slightly in June and is likely to grow between 1 and 2% this year, according to NPD Group.

Buying toys for our kids comes with consequences though. ASDA’s Mumdex research shows that almost half of mums in Britain are more worried about the cost of Christmas this year than last year. And despite more than five months to Christmas, 93% of mums are already stocking up on Christmas gifts.

Sources: FT FT

Poundland posts record results

A poor economy doesn’t mean retailers can’t make money. Poundland has just posted profits of £18.2m - up 50% on last year’s £12.2m. Sales are up 21.6%, to £780m. In the twelve months to April, the store has also hit its target of 400 stores, having opened 62 new stores in the period.

Source: Retail Week

Dixons focuses on service in its ads

Dixons is replacing its Star Wars themed ads with a focus on promoting service in its latest campaign. A key reason according to Dixons’ marketing director is the vast array of products in its stores.

This reminds me of the Apple proposition. Apple undermines the notion that people always want a vast array of choices. Instead, Apple focuses on providing people with the means for doing what they want to do. In a lot of cases, this doesn’t require choice.

Source: Marketing Week

Tesco rewards its customers

Tesco has been criticised for dropping the popular double points initiative as part of the Big Price Drop campaign, which it launched late last year.

Now, news this week that Tesco is launching a promotion encouraging its 800,000 followers on Facebook to ‘share’ any of its products on the network in return for double Clubcard points. Customers earn the points if they go on to buy the product themselves or if their friends do.

Yes, some customers will like this. But others will ask that in an economic downturn, why not just give people double points anyway as a reward for their loyalty? Also, rewarding people for sharing a product only gives short term value to a brand because sharing in this instance isn’t an expression of genuine value or impact upon a person.

Source: Retail Week

M&S set to post poor quarter

M&S will report its first quarter sales on Tuesday at its annual meeting. Analyst consensus is that sales of general merchandise, which includes clothing, will show a 6.7% drop – the department store’s worst performance since the 2008-2009 financial year.

People confused by 'imitation' packaging?

Mountainview Learning and University College London have released research which apparently shows that supermarket customers often mistakenly buy supermarket own brands when they in fact intend to buy other brands.

This can cause reputational damage, yet some brands are likely to feel unable to tackle this because of the close commercial relationships they have to forge with supermarkets.

However, I’m not so sure these purchases can be put down to ‘mistakes’. Isn’t it more likely that the similar packaging helps create the belief that the own brand is as good as the alternative?. Rather than a mistake, it’s a conscious decision.

Source: Marketing Week