TJX is boosting marketing, payroll to sustain winning streak

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TJX Companies’s winning streak continued in Q1 with big sales gains across its off-price banners, including TJ Maxx, Marshalls, and HomeGoods. Comparable sales jumped 6% for the quarter, up from 3% in the same quarter of last year.

The secret sauce of this success is a combination of strong demand for off-price goods, and a steady supply of off-price products to keep inventory fresh.

But the company isn’t resting on its laurels. Executives told shareholders the company will be proactive in the coming quarters to gain market share, and called out payroll increases and increased marketing as two pillars of its strategy.

“We are playing offense to drive our top line and gain a larger share of both the apparel and home fashions markets,” CEO Ernie Herrman said.

Multiple TJX banners are launching new marketing campaigns this year, with a focus on both existing shoppers who visit less frequently and on first-time customers, which have become an important metric for the company, according to Herrman. He noted that a disproportionate number of new customers are coming from a younger demographic.

“Marketing has become more of a weapon,” as the company grows market share, Herrman said.

The other weapons in TJX’s arsenal are payroll increases and training. The company plans to invest in wages to maintain customer satisfaction, improve the store environment, and increase checkout speed.

In addition, TJX is investing in employee training and education. Herrman said the “tenure and depth of our off-price knowledge and expertise within TJX is unmatched,” and now the goal is to develop the next generation of store leaders.