No Turn On Red

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?

More from Facebook Takes Over the Retail World.

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?

Related posts

• Retailers: your customers are talking, why aren’t you listening? (2)
• Wal-Mart’s Urban Tale (0)
• Wal-Mart to face worker-led class-action lawsuit in New Jersey (0)
• Wal-Mart to expand walk-in health clinics (1)
• Wal-Mart to cut back on expansion (2)

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.

Related posts

• Express Lane for 6/13/2007 (0)
• Vera Wang says “I Do” to Kohl’s (0)
• Target and BJ’s near deal to open stores in Stafford (NJ) (0)
• Target advertising on San Fransico’s BART (0)
• Suit: Blogger posted Target trade secrets (3)

Some links for today:

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.

Related posts

• Macy’s stuck with shirts after counting on Buckeyes win (1)
• Target: BTC Super Freaky (0)
• Vera Wang says “I Do” to Kohl’s (0)
• Target and BJ’s near deal to open stores in Stafford (NJ) (0)
• Target advertising on San Fransico’s BART (0)

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.

Recently, Target introduced a line of wedding dresses and related apparel by Isaac Mizrahi. Today, the Chicago Tribune is talking about this, what it means for Target, and what it means for the industry.

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.

Related posts

• No related posts.

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.

More information from Minyanville and the New York Times.

Related posts

• No related posts.

Hadn’t seen this video yet, but it’s from a BART train in San Fransico showing Target’s pretty wild new advertising there:

Pretty awesome effect they’re using there.

Related posts

• JC Penney: Teen sex advert not ours (0)
• Target: BTC Super Freaky (0)
• Target and BJ’s near deal to open stores in Stafford (NJ) (0)
• Suit: Blogger posted Target trade secrets (3)
• Sears. Where it begins. (4)

Same store sales for the month of March are in. Easter fell a week earlier this year and that propelled retailers to a strong month. Across the board, analysts projections were beaten and CEOs are congratulating themselves on a job well done.

Mall based specialty retailers saw a stronger month than they had seen in recent memory: Same store sales were up at Abercrombie and Fitch (up 7.0% vs 1.4% estimate), American Eagle (up 20.0% vs 10.9% est), Aeropostale (up 15.9% vs 9.3% est), Hot Topic (3.4% vs 0.3%), and even Pacific Sunwear (14.1% vs 3.3%).

Gap Inc posted an overall increase of 6%, but look at the brand breakdown: Gap North America was up 4% vs. -13% the same month last year, Banana Republic up 8% vs. -7% last year, Old Navy up 10% vs -15% last year, and Gap International down 5% vs -16% last year. Overall the company showed a strong month, but I am most impressed by the gains at Old Navy. Female shoppers must be responding well to the new line of babydoll dresses (I know my girlfriend has! I’m sure at least 2 of Old Navy’s 10 percentage points increase are due to her March shopping).

Mid-tier department store retailers Kohl’s and JCPenney beat estimates with same store sale increases of 16.8% and 10.6% respectively. Nordstrom’s saw sales rise 15%, while Federated struggled and came in short of estimates (3.8%) with same store sales rising only 2.3%.

Like everyone else in my town, I found myself in my local Target at 9:30 the night before Easter looking for candy and easter baskets for my neices & nephews. With the way that place was cleared out, it’s no wonder Target as a chain posted a same store sales increase of 12%. Wal-Mart came in with a 4% increase. Not good, but not great.

More information from Minyanville and CNBC.

I am traditionally leary of the March or April sales on their own, due to the yearly differences in the date of Easter. I’m interested to see how well these numbers hold up when April’s final numbers come out. It looks like most retailers benefitted from the early Easter, which allowed those sales to get lumped in with March’s overall sales - as opposed to April last year.

Will April be as kind to retailers? Time will tell, but I’m betting that with the cold spell over the Northern part of this country that sales are going to be very, very interesting.

Related posts

• Sears + K-Mart, Year One (0)
• Retailers put ads where the teens are (0)
• Retail roundup - Q2 results, Kohl’s (0)
• Retail roundup - Q2 results, JC Penney (0)
• Q2 Earnings, Gap Inc. (0)

A mixed bag of results for retailers. Generally positive month for department stores, but a pretty wild range of results for mall-based retailers. More than a few full year outlooks have been cut, prompting investors to react accordingly.

Department stores fared decently with the mild weather. Same store sales for Kohl’s up 3.0%, JC Penney up 2.6%, Federated up 4.4%, Dillard’s fell 5%, Nordstrom was up 9.0%, and Saks was up 11.0%. Mixed bag of results, since even the positive gains for KSS, JCP, and Federated still fell below expectations.

Specialty retailers were generally beat this month. Same store sales for Abercrombie were down 1.0%, American Eagle was up 13.0%, Aeropostale was up 1.7%, Ann Taylor was down 5.3%, Gap down 8.0%, Hot Topic down 5.1%, Limited up 4.0%, and PacSun down 3.2%.

Target was up 4.1% while Wal-Mart same store sales were up 1.6%.

Seems like the mall stores, with space at a premium, were hurt the most by the mild weather nationally. With only so much space available in the store, and most of that devoted to sweaters and cold weather accessories, things can go sour fast when no one is shopping for that.

More coverage from Minyanville.

Related posts

• Kohl’s Shareholder Meeting (0)
• Jim Cramer on Kohl’s and JCPenney (0)
• Holiday’s Over (1)
• Wal-Mart to expand walk-in health clinics (1)
• Success and convtroversy lead to higher national profile for Rutgers (0)

Gap has brought in an Aussie to head up Old Navy. I’m trying to think of a way to work “down under” into a joke involving Old Navy, but it’s just not coming to me. Perhaps this new blood will be the spark that they need to get that arm of the business turned around.

Finn over at Lightheavyweight takes a look at American Eagle’s new brand, aerie, from a design perspective (see: A+ for Aerie). He’s got a good look at the design and how it is building the brand effectively.

Target’s put out a list of their 2007 store openings. Apparently, the store in South Brunswick, NJ, is opening in both March and July.

Finally, the Associated Press had an article over the weekend detailing the transitions that the music store business has undergone in spite of piracy and rising sales of digital music (see: Music hasn’t ended for record stores). Most independent music retailers have not been able to compete with the big boxes (Best Buy, Target, and Wal-Mart) for new releases, and this article details how the industry has changed in that time.

Related posts

• No related posts.

Couple of notes for this week:

As Nintendo gets ready to launch their new console, Wii, in November, Engadget has a first look at some of the retail information for the unit, including CompUSA’s cost v. price information and photos of the new endcap displays in production for Target (see: Wii retail details: markup and endcaps).

Retailwire (subscription required) carried a story and discussion about Lord and Taylor last week (see: New Owner Buys, Looks to Build Lord & Taylor). With the sale of Lord & Taylor fully complete now, NRDC Equity Partners has started announcing some of their plans for the chain. They’ve announced that they will be downsizing the Fifth Avenue flagship store and closing their Water Tower Place store in Chicago. However, they say they are commited to growing the brand and looking for opportunity to expand, including looking into more freestanding, lifestyle center options.

Finally, one more video game note: I love reading blogs with an interesting perspective on retail, and A Day In The Life Of Video Games is no different. This is a blog written by employees of a video game store, sharing their experiences with customers and customer service. Very funny insight into this segment of retail.

Related posts

• No related posts.