Taking aside the many different things going on in our industry (that is part of another conversation - digital vs. printed, modern vs. traditional, etc.) and the economy, I think the simple things are sometimes forgotten. I know, easy for me to say because I am not at the retail level.
Carol is realistic in knowing that times will be tough but I think that she survives for different reasons:
1. Customer service. She chats and gets to know you. As cliche as it sounds, those first impressions make a difference. I think that it can help put people in a good mood and it leaves a lasting impression for future visits. She makes the customer feel welcome.
2. Passion. Customers can see the love that she has for her shop.
3. Inspiration. Try to give your customers an inspiring experience. Keep it fresh. Keep it unique. Give them something that they will want. I feel as though I am discovering a new treasure every time I visit.
4. Personality. Carol's unique displays are carefully curated.
I am not trying to be simplistic in saying that these things will cure all. Rather, I hope that these thoughts help you fly through the good and the bad times.