The news: Five Below’s social media strategy helped deliver five straight quarters of double-digit comparable sales growth, CEO Winnie Park said during the company’s earnings call.

• Last year, the retailer shifted much of its media spend from traditional advertising toward social media, amplifying trends and building brand awareness.
• At the same time, Five Below remerchandised its stores and rethought how it presents products, with an emphasis on “really great stories and curated product stories that are grounded in what’s happening out there,” Park said.

The approach helped breathe new life into products like the Squishy Dumpling, which had been in stores for five years before becoming a viral phenomenon last year.

How we got here: Five Below said a three-pronged flywheel was key to its success.

Curated product storytelling. Five Below positions its stores as a destination for kids and the young at heart, offering extreme value on trends such as squishy items, licensed products, and seasonal offerings.

Amplifying those stories through social and digital marketing. By shifting spend from traditional TV commercials to the social and digital channels, Five Below is meeting its core customers where they are. It also uses social signals to spot emerging trends and feed those insights back into merchandising.

A fun, easy-to-navigate store experience. Five Below reorganized its stores by eliminating the separate, higher-priced “Five Beyond” section and integrating those products throughout the store. It also organized the floor around areas such as Candy, Style, Party, and Room, making it easier for shoppers to find products they discover online. The changes have helped increase conversion and basket size while driving repeat visits, Park said.

Implications for retailers: Five Below is thriving—at a time when consumers are pulling back on discretionary spending at other merchants—by making shopping fun and giving consumers affordable indulgences.

While strong merchandising gives Five Below a steady stream of on-trend products at accessible prices, its flywheel is the secret sauce that brings everything together. Social media helps the retailer identify and amplify trends, while its stores make those products easy and enjoyable to discover.

This content is part of EMARKETER’s subscription Briefings, where we pair daily updates with data and analysis from forecasts and research reports. Our Briefings prepare you to start your day informed, to provide critical insights in an important meeting, and to understand the context of what’s happening in your industry. Non-clients can click here to get a demo of our full platform and coverage.