Taking chances on stores
With the major operational challenges addressed, Mason began leading the company on an aggressive push for new markets for stores.
During her tenure, the number of stores has grown from 415 in 2000 to 732, with plans to reach 1,000 by 2010. She doesn’t shy away from small cities but says a new market must meet specific criteria, such as median income. Tuesday Morning aims for communities with an average household income of $60,000 but doesn’t consider that a hard-and-fast rule. Executives also look at other factors, such as average educational levels, that help them get an understanding of the community and whether it will support a store.
“They do have to have more of an aspirational customer, a customer who really wants quality at a price,” Mason says. “That can still cut a pretty wide swath. Even a young customer on a limited budget wants quality. If they recognize a name brand, nothing else will do. … We are opportunistic in everything we do, so we might bend the rules a little bit. But there are a number of metrics that we look at.”
To keep costs down and profits up, Tuesday Morning looks for bargains in real estate, sometimes settling for locations that other retailers might pass up because it knows that customers will make the effort to find the store.
It has been aggressive and taken on some risky markets, but there has only been one that simply didn’t fly, Mason says. A store in Cheyenne, Wyo., opened in February 2001 and closed in June 2002.
“That was a real stretch for us,” Mason says. “Although it is an upscale community, there are just not enough people there who are interested in shopping. It’s too spread out, too remote.”
Mason says her only other flop was attempting to make the stores more attractive with better-looking shelving. But after several tries, she abandoned that effort because the new shelving was difficult to work with and didn’t seem to matter to shoppers.
“We thought it was a way to pretty up the stores and better display merchandise,” Mason says. “It was expensive and too specific. Our customer is used to the treasure hunt and doesn’t mind that. We are not for everyone, but the customers who have come to appreciate our no-frills format really do benefit by finding some of the most fantastic things from around the world.”
Mason also has increased the number of days the stores are open. When she came to Tuesday Morning, they were open about 250 days a year and closed in January, July and between sale events. Now, they are open about 300 days a year.
“There is always that risk of hurting that sense of urgency that was part of our formula,” Mason says. “But we had to balance that with the consumer’s desire for convenience. It was a clamoring request, especially from younger customers who say, ‘Look, I’m a working woman and I can’t pay attention to when you are open and closed.’”
Mason and other Tuesday Morning executives give a lot of thought to that customer, who she is and what she wants. They want to know who those customers are, how much they make, where they live and what their shopping habits are.
In 1998, before Mason came to the company, Tuesday Morning did a complete analysis of customers through surveys to get that information. It recently completed another year-long survey, and the results will likely guide future decisions.
“It helps us really refine our understanding of who is buying at Tuesday Morning and to be more pointed in addressing that customer in terms of communication in every way,” Mason says. “It’s like when you give a speech, you need to know your audience. You don’t communicate with everyone the same way. The more you know that person, the better you are able to communicate with them.”
The survey results are still being tabulated, but Mason says it appears that the Tuesday Morning customer is very much the same person she was six years ago.
“We still have a wonderful core customer who is an upscale customer,” Mason says. “She really appreciates and recognizes brand names. They really have to be a shopper.”
HOW TO REACH: Tuesday Morning, www.tuesdaymorning.com
