Shop Talk
Retailers, consumers and prices
Check Out Line: Tussle over toys as holiday season nears
Check out the latest news on the fight for a piece of toy market.
U.S. retailer Sears plans to launch 85 toy shops in select markets next month as it angles for a bigger bite of the holiday sales pie, a senior executive told Reuters. Specialty retailer Toys R Us previously announced plans to open about 600 temporary stores and 10 FAO Schwarz “pop-up” stores this year.
The move from the operator of Sears department stores and the Kmart discount chain comes as competition heats up in the toy market ahead of the crucial selling season.
“We have a very aggressive plan for growing our toy business,” Julia Fitzgerald, chief marketing officer for Sears’ toy business said in an interview ahead of an event marking the launch of Kmart’s top toy picks for the holidays.
The decision came after many customers showed interest to shop for toys in convenient locations such as malls, during a pilot program in 20 department stores last year.
The initiative brings Sears back to a business with which it has a rocky history. Earlier this decade, Sears experimented with “store-within-a-store” partnerships with KB Toys, but ultimately pulled the plug.
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Check Out Line: Steady is the new sexy!
Check out the boring but steady holiday-season sales outlook.
U.S. retailers might have reason to celebrate amid the weak economy as a steady holiday season with a gentle increase in sales this year, executives said at the Reuters Consumer and Retail Summit.
That would be a relief after the plummet in sales in 2008 as well as 2009, when stores waited for shoppers to return. But don’t expect a return to the heady days of 2007 either as shoppers are likely to remain cautious through the rest of the year.
“It’s going to be the most boring holiday season we’ve had in quite some time,” said Janet Hoffman, global managing director for Accenture’s retail practice. “(That’s) going to be really good news for many retailers because what they’re going to see is incremental lift in sales.”
At the summit, clothing maker Perry Ellis said it sees industrywide prices on apparel rising 10 percent over the next two years.
Meanwhile, Collective Brands, the holding company for Payless ShoeSource and Stride Rite, is optimistic about back-to-school sales in the United States.
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Check Out Line: Estee Lauder had a beautiful holiday season
Check out Estee Lauder’s much better-than-expected end to 2009.
The cosmetics maker said fiscal second-quarter results, due next week, will fly past its forecast and Wall Street’s predictions. Sound familiar? That’s because the company did the same thing back in October, before it released results for the first quarter of its fiscal year.
Analysts noticed the similarity. JP Morgan’s John Faucher entitled his research note “Deja Vu” and many said with the stock’s nice run already (up about 56 percent in 2009), big gains from here are likely limited.
In the latest quarter, U.S. holiday season sales came in better than anticipated. So did sales in Asia and at airports. Another big benefit came from spending cutbacks. Don’t expect such frugality during the second half of the fiscal year. Estee Lauder, led by CEO Fabrizio Freda (seen here), said it would step up investment behind its brands and key priorities “well above” first-half levels.
Does the company’s optimism mean that beauty is back for good? Or was it just a holiday gift? We’ll find out more when Estee Lauder and Elizabeth Arden issue their results on Jan. 28 and Avon follows in early February.
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Check Out Line:Teen retailers’ painful holiday
Check out how teen retailers have miscalculated demand this holiday season and are resorting to steep discounts to get savvy young shoppers into their stores.
A visit this week to a Bay Area mall by Reuters reporter Alexandria Sage found that teen retailers such as American Eagle as well as Abercrombie & Fitch and its Hollister chain, have been reduced to slashing prices and offering “buy one, get one for half off” promos to salvage a holiday season that was supposed to be merrier than last year.
Like other retailers, the teen stores reined in inventory in the hopes of avoiding the deep discounts they’ve ended up have to offer anyway.
Their biggest goof? Bland, homogenous items, leaving pricing as the only differentiator.
Many teen retailers’ stocks have tumbled since 2009 highs reached just two months ago, and at the rate they’re going, investors may just leave them lumps of coal in their stockings next week.
Also in the basket: - Rite Aid narrows loss despite sales drop, shares up - Pier 1 surprises with profit, sees better margins - National Beef pulls IPO
(PHOTO: Reuters)
Many teen retailers’ stocks have tumbled since 2009 highs reached just two months ago, and at the rate they’re going, investors may just leave them lumps of coal in their stockings next week.
Winds blow in retailers’ favor
This Thanksgiving shopping weekend, the weather may be one element not giving retailers a headache.
Retailers are geared up for the crucial three-day Thanksgiving shopping weekend, and many have already slashed prices to kick-start sales and rouse wary shoppers into spending mode.
While this holiday sales season could be the worst in years as declining home values, higher food prices, a credit crunch, and rising unemployment curtail consumer spending, weather tracking firm Planalytics has some good news for retailers — it predicts that most major population centers in North America should experience favorable weather conditions during the Thanksgiving weekend.
In addition, the current cold weather in the Midwest and East Coast have put consumers into a holiday mindset earlier than last year, Planalytics said, boosting demand for seasonal items.
“While, for some areas, snow flurries and precipitation events are likely over the weekend, they will reinforce to consumers that the holiday season has arrived,” Planalytics stated.
There could be some ”traffic limiting” events in the Midwest and Great Lakes as weather systems resulting in a wintry mix could keep people close to home, the firm said. But it said the Southeast should experience seasonal conditions, and the eastern half of North America should anticipate strong demand for seasonal items like scarves, hats, gloves, sweaters, skiwear, soups, hot beverages, and lip care.
Planalytics also said the overall trend in the West supports favorable demand for seasonal apparel and consumables, such as food and household cleaning products.
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