Drano

Dollar General targets wealthier suburban women with "Popshelf"

Friday, October 9, 2020 by Snacks

Googling "how to be special"... First, change your name. Dollar General is tired of selling you $2 necessities like Cool Whip and Drano. So the discount chain is launching "Popshelf" (so fun, so fresh) — a store aimed at higher-end shoppers who still love a good deal. Inside, it looks like a mashup of Ulta Beauty and Blick Art Supplies. Hence...

  • The crowd: Popshelf is geared toward suburban women with household incomes of $50K-$125K/year, compared to Dollar General's core customers from $40K households.
  • The goods: Popshelf will feature "nice-to-have" goodies (think: home decor and beauty products), rather than showcasing 24-packs of TP at the entrance ("need-to-have").

The thrill of the hunt... DG wants to cash in on the "affordable splurge" treasure hunt experience that TJ Maxx thrives on. Most Popshelf items will cost less than $5 and will be changed out on the reg to surprise customers (and encourage more visits). Instead of rushing out of one of DG's ~16K stores with Clorox, you're spending an hour in Popshelf browsing scented candles and charcuterie trays. The fun experience leads to more spending.

THE TAKEAWAY

Nail the target, then expand it... Dollar General is living its best life with its lower-income target customers. Wallets are corona-hurting, so DG's thrifty basics are winning. Sales jumped 19% last quarter and DG stock hit at an all-time high yesterday. This growth means it's a perfect time for DG to reach beyond its tapped-out customer base to wealthier shoppers.

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