Check out American girls continuing to shun Barbie,  despite Mattel’s attempts to revitalize the once-dominant brand with sleek, new products.

Since coming to market in 1959, Barbie has played a key role in Mattel’s profits.  But that may be changing as Mattel posted a profit despite another decline in U.S. sales of the flagship line.

“Innovation has been lacking, in our view, on the Barbie line,”  Sterne Agee analyst Margaret Whitfield said in a Jan. 25 research note.

Last year Mattel rolled out new Barbie products such as Chat Divas, — a doll able to move and lip sync to music played on one of Apple Inc’s iPod music players  — and the Rainbow Adventure Elina Doll and DVD game.  The doll functions as an interactive controller for the game.

Fourth-quarter Barbie sales fell 12 percent in the U.S.  but rose 4 percent internationally, as the weak U.S. dollar boosted the value of overseas sales.

“We need to do some work. Both our spring and fall fantasy lines didn’t meet expectations,” said Chief Executive Robert Eckert, adding that Barbie’s full-year results were “disappointing.”

Also in the basket:

P&G profit rises, to carve off Folgers

J.C. Penney may slow new store openings

Nike says Umbro accepts its acquisition offer

Check out the resignation of Sears Holdings Corp chief executive Aylwin Lewis,  the latest in a shake-up for the U.S. retailer, which warned earlier this month that its fourth-quarter results would be much less than those from a year ago.

Despite its management moves, the company might also still be interested in a deal with Restoration Hardward Inc.

Sears Holdings, which is controlled by hedge fund manager Edward Lampert, was formed with the 2005 merger of Kmart and Sears. It has struggled to entice customers and is now being hurt by an economic slowdown that has hurt sales of home goods such as appliances and tools. 

Last week the company said it would separate into five types of business units and simplify the way it’s managed in a bid to boost results and reverse recent profit declines.

“We will be redefining how our leaders operate by giving them greater autonomy and accountability for their businesses,” Sears chairman Edward Lampert said on Monday.

Sales at stores open at least a year — a key retail measure known as same-store sales — have fallen at Kmart and Sears for the last seven quarters.

 Also in the basket:

McDonald’s net up, but same-store sales flat

Tyson’s earnings tumble

Is it a recession? Marketers seem to think so (New York Times)

Makeover at Old Navy: Faster Fashions key to monthly collections (Women’s Wear Daily, subscription required)

Wendy’s says strategic review in final stages

U.S. antitrust officials seen swallowing beer deal

While the National Retail Federation was quick to praise the $150 billion U.S. economic stimulus package agreed to by the White House and Congress, analysts said it was nothing more than a desperate move by lawmakers in an election year.

“This is a band-aid on nothing. This is a temporary stimulus — in an election year and for Bush’s reputation — that doesn’t address any of the systemic problems,” said Howard Davidowitz, chairman of New York-based retail consulting firm Davidowitz & Associates Inc.

Mark Coffelt, the chief investment officer of Empiric Funds, said he was disappointed in Federal Reserve Chairman Ben Bernanke’s response.

“Instead of endorsing all the politicians’ lust to send checks out to all the voters, it would have been better to say at the Federal Reserve ‘we don’t see a recession,” said Coffelt, who holds short positions on retail stocks.

“Basically what he said was, ‘we don’t have things under control.’ That’s not what the markets wanted to hear.”

 (Photo: Reuters)

Check out Hershey Co’s plan to team up with Starbucks as it tries to move past a drop in quarterly profit and a bleak near-term forecast. Sluggish sales and rising costs for milk and other ingredients are a bitter reality for Hershey, the maker of Hershey Kisses, Reese’s peanut butter cups and a host of other candies. Hershey’s stock melted, down 28 percent in the last year, as it lost market share to rival Mars Inc. Rivals have tempted consumers with new products, particularly in the premium chocolate segment.

Hershey said it will launch a new line of chocolates with coffee powerhouse Starbucks. It’s also rolling out a sweet new line called Hershey’s Bliss. Both are expected to come to market in March. 

“Our primary goal in 2008 is to stabilize the U.S. business marketplace performance,” Chief Executive David West said in a statement. “New chocolate products within the premium and trade-up segments will help enable us to achieve this goal.”

 Also in the basket:

Kimberly-Clark 4th-quarter net down

Tommy Hilfiger IPO shelved due to market volatility

Wal-Mart outlines vision as “company of the future”

Whole Foods Chain to Stop Use of Plastic Bags (New York Times)

A Growing Empire: L’Oreal Agrees to buy YSL Beaute for $1.68 bln (Women’s Wear Daily)

Wal-Mart Targest Pharmacy Benefits (WSJ)

(Photo Source: Reuters)

John Ortiz isn’t old enough to remember Michael Jordan in his prime playing years with the Chicago Bulls. The Jordan he saw play was 40 years old and in the final stages of his playing days with the Washington Wizards.

But the Jordan Brand is still hot enough that Ortiz is willing to brave two frigid nights outside Champs Sports in New York’s Times Square for a chance to buy a pair of limited edition Air Jordan XX3’s.

“Honestly, I don’t like them that much. I was attracted by the fact they were limited,” said Ortiz, 16.

The sneakers will be released in three installments beginning Friday, starting with the limited edition that’s only being sent to 23 stores to be sold for $230 at retail. There will also be a release during the National Basketball Association’s All-Star Weekend, and a final nationwide rollout Feb. 23. 

The Air Jordan XX3 gains significance from the fact that Jordan wore the number 23 during his playing days. And according to published reports, Nike is considering retiring the shoe at 23.

The limited supply has Ortiz salivating over how much he can charge for the new Jordans.

“That’s my whole motivation for this camp out,” he said.

(Photo Source: Jordan Brand)

Did the rising cost of food and fuel cause consumers to eschew beautifying themselves for the holiday’s? Regis Corp’s second-quarter results suggest that just might be the case.

Regis, whose Salon chains include Supercuts, Jean Louis David and Vidal Sassoon,  said its second-quarter profit fell to the low end of a forecast range on a sharp drop in consumer spending over the holiday season.

“Like many retailers, we had a disappointing holiday shopping season and as a result, our quarterly same-store sales came in below expectations,” Chief Executive Paul Finkelstein said.

But the steps Regis plans to take may not help consumers.

“We will continue to focus on increasing our average ticket and, more specifically, implementing price increases,” Finkelstein said.

 (Photo: Reuters)

While many investors have ditched the home decor sector due the crippling effects of the U.S housing crisis, analysts say they’d be wise to take a second look at Bed Bath & Beyond.

Although it may suffer some near-term pain — it warned its fourth-quarter earnings may be weak earlier this month — a strong cash flow, minimal debt and friendly valuation might make it a wise long-term investment.

“Investors have such short-term perspective … When we get a little better environment, Bed Bath & Beyond is in pretty good position,” said Andy Cross, a senior analyst at The Motley Fool, an online community for investors.

Credit Suisse analyst Gary Balter went a little further with his hopeful assessment of the company’s future.

“The weakness in the macro environment should turn out to be a blessing in disguise for Bed Bath,” he wrote in a Jan. 14 research note.

“We would expect that smaller players may also not survive weakness in 2008, which is another good signal for BBBY.”

The most frustrating issue for home decor retailer Pier 1 Imports these days isnt’ the daunting rebuilding effort it’s undertaking, or the skittish real estate and credit markets which are undercutting consumer spending.

For them it’s the media and it’s role in spreading word that a recession may be on the horizon, Cary Turner, Pier 1’s Chief Financial Officer said at the Cowen and Co. consumer conference in New York.

“The biggest frustration we have is the media. They continue to want to keep talking about the ‘R’ word,” Turner said.

Although the current sales environment has been harsh for home decor retailers –  Williams-Sonoma reported disappointing holiday sales and slashed its outlook, while Bed Bath & Beyond warned of a weaker-than-expected fourth quarter – things have been looking up for Pier 1 lately.

Last week it said December sales at stores open at least a year rose 7.5 percent — its strongest December in six years.  And analysts said last month that Pier 1 was starting to show evidence of a turnaround after it cut costs and posted a narrower quarterly loss.

But despite making noticeable strides, Pier 1’s turnaround has a long way to go, according to Turner.

The company needs “to recapture that treasure hunt feeling,” Turner said. “Traffic is a little down.”

The current sales environment has not been kind to home furnishings retailers of late, with consumer appetite for their wares falling due to an infirm U.S. housing market.

But with attractive promotions – such as free shipping offers and 20 percent off coupons — throughout the quarter, Bed Bath & Beyond is in line to meet Wall Street’s expecations and is well positioned for growth, CIBC World Markets analyst Vivian Ma wrote in a Jan. 2 research note.

“We remain bullish on (Bed Bath & Beyond’s) longer-term potential,” Ma wrote. “Growth should accelerate next year given roll out of Christmas Tree Shops, buybuy BABY and Canada. We continue to recommend (Bed Bath & Beyond) for long-term investors,” wrote Ma, who has a “sector outperformer” rating on the stock.

The retailer reports its third-quarter results on Thursday.

Check Out Nintendo Co Ltd’s Wii video game console as a darling of the 2007 holiday shopping season. 

Strong demand for the Wii was key to U.K. video game retailer Game Group Plc’s  better-than-expected full-year profit forecast, the company said on Monday.

Last week, Amazon.com Inc said it sold nearly 17 of the popular systems per second when it had them in stock, helping the online retailer post the best holiday season in its history.

Last month, the system helped Nintendo remain king of the U.S. market with 981,000 Wiis sold in the console’s best showing since its November 2006 debut, according to market research firm NPD Group.

Also in the basket:

With Wii and DS, Nintendo has 2 Hit Game Devices (New York Times)

Credit Crunch, Housing Crisis Socks Retail (New York Post)

Macy’s to close nine stores, affects 899 jobs (Reuters)