Dollar General Eyes a New Demographic

Popshelf Aims to Attract New Customer Base

Dollar General (DG) is opening up a new line of stores, but legacy customers at the discount chain might not recognize them. The new brand is called Popshelf.

Popshelf will sell non-essential goods, including home decor, cosmetic products, kitchen supplies, and party provisions for around $5 or less. The household income of Popshelf’s target customer is $125,000 per year. For contrast, Dollar General’s current customers are mostly women from households earning around $40,000 per year.

Shoppers around Nashville will be the first to experience Popshelf, but Dollar General plans to open 30 more stores in the suburbs of large metro areas before the end of 2021.

Seeking Relevance Mid-Pandemic

It may seem counterintuitive to open a chain of stores selling non-essential goods during a global pandemic that’s forced many Americans to make tough choices about what’s essential to their lives. Indeed, the idea for Popshelf came about before Americans ever heard of COVID-19. However, Dollar General thinks the new Popshelf brand could become more relevant due to the pandemic. According to Emily Taylor, Dollar General Executive Vice President and Chief Merchandising Officer, customers might be attracted to a store where they can indulge without worrying about their budget.

Plus, in the past few months, shoppers have bought more and more home decor items. Popshelf hopes to attract customers looking for “fun” purchases at a reasonable price in an ailing economy. Like many grocery chains, Dollar General has seen increased sales during the pandemic as shoppers stock up on cleaning products, canned goods, and paper products. In the last quarter, Dollar General’s sales ballooned by 19%.

Keeping the Brands Separate

Dollar General will still make a concerted effort to keep its discount chain brand separate from Popshelf. Over the past few years, the company conducted an experiment in stores by adding more holiday decorations, beauty products, and home decor items to its shelves. Executives decided they could attract more high-earning customers by creating a new brand for those items and separating it from Dollar General.

Instead of focusing on reliable, inexpensive household items, Popshelf will carry what the company calls “treasure-hunt items.” These limited-time-only products should spur more frequent shopping trips to Popshelf. With social media advertising, different items, and a special team hired to source new products, Popshelf will be a very different type of store.

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