Over at ecommr, we’ve been adding e-commerce elements related to Black Friday. Head to ecommr to see a roundup of the different banners, homepage landing, and e-mails that retailers are using to promote their Black Friday specials. More will be added as we come across them.
As a related note, it appears (to me) that retailers are being more aggressive in their marketing for Black Friday, with earlier campaigns and with more detail. Normally, promoting specific price points for comes right before Thanksgiving. But this week has been filled with “online previews”, television commercials, and e-mail marketing that seems to be more aggressive and detailed than years past. Retailers are trying to step up their game in order to capture a larger piece of the shrinking sales pie.
Walmart and Target both have their Black Friday ads online and featured prominently on their homepages. Kohl’s even has an entire section on their site that allows customers to browse the Black Friday ad and make a printable shopping list.
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Finally, Target has announced a variety of relief efforts. They’re donating $300,000 in product relief packages assembled by volunteers and delegates from the Republican National Convention. The retailer has also given the American Red Cross access to their store in Convington, LA for use as an emergency operations center, and are allowing the Salvation Army to use a vacant store in Dallas, TX to store supplies.
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The stimulus checks have been (presumably) spent, back to school shopping is underway, and the retail sales numbers for July are in and they are, well, pretty ugly. A lot of retailers posting negative same-store-sales numbers for the month, many of them posting numbers that fell below Wall Street’s expectations. Wall Street is responding – as of 12:30, the S&P Retail Index is down around $7.
The negative results are hitting all segments of retailers – from department stores to the mall, teen retailers to mass market merchandisers. Wal-Mart posted a positive sales increase of 3.0%, but that is less than the 3.5% increase that Wall Street was looking for. Target saw same store sales drop 1.2% in the month of July and warn that August isn’t going to be much better. JCPeneny’s sales dropped 6.5% but raised their Q2 guidance “due to better than expected sell-through of promotionally priced merchandise and continued expense management measures.” Kohl’s saw a steep 10.4 drop in same store sales in the month.
Gap saw negative numbers across all brands – Old Navy down 16%, Banana Republic down 8%, and Gap North America down 6%. When are they going to spin off the Old Navy brand, sell it, and let someone else deal with the turnaround?
Teen retailers aren’t seeing the Back to School numbers they hoped for with American Eagle down 7%, PacSun was down 4%, Abercrombie & Fitch (as a company) was down 7% (with only A&F proper posting flat numbers, up 1% for the month. Hollister was down 11% – blowing away the 4.1% decrease expected by analysts), but Aeropostale saw sales jump 13%.
A few of the stories I’m reading and wanted to share today:
John Zogby’s got a very insightful look into the political trends of retail consumers and dives behind the numbers to make sense of it all. He looks at presidential election polling numbers, the retailers the customers shop at, and how this relates to the retailers’ branding.
.. and finally – Starbucks is offering a $2 discount on iced beverages in the afternoon when you buy a drink in the morning. I think this is a smart move that should drive repeat business throughout the day. Besides that, I’m selfish and now look forward to saving a little bit of money on my second trip to Starbucks every day.
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Good post this morning over at Retail Design Diva talking about how retailers are using Facebook to capture the Back to College crowd:
Students can take a quiz to discover their “decorating style” and (ta-da!) receive a list of products they can buy at Wal-Mart that best reflects their style, and their roommates’, of course. How smart is this?! Students can also search Wal-Mart’s Web site for eco-friendly products or download a shopping list of dorm room pieces. The hip, new items can then be shipped directly to the school (no furniture hauling for dad), making life a lot easier for parents and kids. And let’s be honest, mom and dad are going to be all over that, even if they don’t have a Facebook account. This idea is absolutely brilliant–and I don’t even shop at Wal-Mart.
In a world of Facebook, MySpace, LinkedIn, YouTube and a variety of social networking and media sites, retailers could benefit substantially from plugging in. Securing teen and college kids’ dollars is extremely lucrative. Connecting with them on their own platform is invaluable. Apparently, Wal-Mart did its research, because according to the National Retail Federation, the average first-year college student spends $1,112.62 on back-to-school gear. Cha-ching. Who’s in for setting up a MySpace account?
Credit to Wal-Mart to being ahead of the curve of traditional retailers in adopting new technology to reach out to customers. Curious to see how these consumers react to Wal-Mart when Target seems to have a stranglehold on this segment. Could social media technology give Wal-Mart a leg up?
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A bit of lingo that I’ve learned lately: turns out that Target refers to the the impact of the Back to School/Back to College season on their stores, by classifying them into levels. The levels are No Affected, Affected, Freaky, and Super Freaky. It doesn’t appear that there are a lot of Super Freaky stores in the company, but those that are classified as such, are situated within close proximity to college campuses. I wonder what kind of percentage increase these stores see, over the rest of the company, during the season.
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First off, two stories from the Consumerist. In one, an Target employee alleges that security there “mostly follows black people”. Article contains a rebuttal on most of the points from another current Target employee. As usual with the Consumerist, great comments on that article with some more interesting information.
Also from the Consumerist, some leaked internal documents from AT&T, in regards to the retail end of the iPhone launch. As the biggest technology and consumer electronics launch of this year, this will have huge implications on retail. With so many people wanting to get it, I’m interested to see how other retailers (non AT&T/Apple) react to this and try to get people to buy their products on iPhone launch day.
Yesterday’s New York Post has an article, Macy’s Margins, on the behind the scenes concerns of Macy’s regional buying officiers and what that means to the consumer.
Finally, Zumiez’s Couch Tour was in Deptford, NJ (just outside of Philadelphia). Reports are that several teenagers were hurt at the concert. But what is amazing to me is that estimates put the crowd at 2,000 to 2,500 people. Great turnout for this event. I’d imagine Zumiez is happy with those kinds of figures. More coverage from the Gloucester County Times.
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Stories that I’ve come across today on the web that I’d like to share:
Originally announced back in August, the Rite Aid purchase of Eckerd and Brooks pharmacy chains is official today. Rite Aid will have to divest certain properties to allow for competition. Conversion of the stores should take 16 months. Once this deal is complete, Rite Aid will be the third largest pharmacy chain in the US (behind Walgreens and CVS) and the predominant pharmacy retailer on the East Coast. More thoughts from the Albany Times Union.
I’ve got to say that I’m sad to see the Eckerd brand go. Part of it is the fact that the Eckerd stores in my area are newer than the Rite Aid locations, making for a more pleasurable shopping experience.
Last week the Motley Fool had a good look at Abercrombie & Fitch, this week they’ve got a good look at J.Crew. They’ve had a succesful IPO, improved their gross margin, increased revenue, and increased same store sales. Good times for that retailer.
Finally, lux.et.umbra is asking whether summer hours would improve business in Silicon Valley. Good thoughts. The budgets for small retailers is tight, but not being open when your customers want to shop is bad business. That’s not to say that everyone should be open 24 hours, but late hours during the Summer may not be a bad thing.
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If you look at the retail comp store sales numbers for the month of April, you are looking at one ugly picture. But this was to be expected when taking into account the early Easter holiday this year.
For the month of April, the mall posted lackluster numbers: Abercrombie & Fitch saw a decrease of 14% (further breakdown of the brands: A&F adult -13, abercrombie, -18, Holister -17, & Ruehl -6), American Eagle down 10, Aeropostale down 14, Ann Taylor -12.8 (further breakdown of the brands: Ann Taylor -8.2 & Ann Taylor LOFT -17.4), Gap Inc down 16 (further breakdown of the brands: Gap North America -14, Banana Republic -13, Old Navy -20, and the International division -5), Hot Topic -9.1, Limited Brands -1.0, PacSun -14.
Some department stores saw slightly better numbers, but not all of them. Winners included Nordstrom (up 3.1) and Saks Fifth Avenue (up 11.7!!). On the flipside, Kohl’s was down 10.5, Federated was down 2.2, JCPenney was down 4.7, and Dillard’s was down 14.0.
Target saw a drop of 6.1 and Wal-Mart was down 3.5.
These numbers are bad, but are the indiciative of a worrisome trend? Look at March’s numbers and remember that these April numbers don’t include Easter. I think there are some retailers who are struggling, but the industry as a whole is just fine. A better picture of retail health will be seen over the next two weeks as retailers release their second quarter earnings results.
