ETD: 945 Online Retail Marches Ever Upward; U.S. Holiday Sales
Results; The Consumer-Driven Store: 3rd Annual Store Systems Study
Data Analysis
E-Tailer's Digest
etd_post at gapent.com
Mon Jan 9 23:32:09 GMT 2006
E-Tailer's Digest --- Everything for the Retailer
Issue #0945 January 10, 2006
George Matyjewicz, Moderator mailto:georgem at gapent.com
Published by: GAP Enterprises, Ltd. http://www.etailersdigest.com
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CONTENTS
[1] Greetings
[2] Online Retail Marches Ever Upward
[3] U.S. Holiday Sales Results
[4] The Consumer-Driven Store: 3rd Annual Store Systems Study Data Analysis
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[1] Greetings.
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Hi All:
Happy New Year. I hope your holiday season was
successful, and that you are ready for the new year.
This season has been quite good as reported by a
couple of sources. Online sales was between 25%
and 30% higher than last year. And it will
continue to grow. What I found interesting is
this is the 11th holiday (Christmas) season that
Amazon has had. Hard to believe we've been doing this for so long eh?
Offline sales were also higher than last year,
although heavy discounting helped again this
year. As Pam Danziger has been telling us,
luxury retailers did best this season. The final
results won't be in until the end of January when
folks cash in their gift cards.
Speaking of luxury, one of our clients has
introduced a new line of vintage sleepwear that
brings us back to the 1800s. Not surprisingly
the sales price will be in the $1,800's.
There will be a FREE seminar entitled "The
Consumer-Driven Store: 3rd Annual Store Systems
Study Data Analysis" which may be of interest to you. Check it out below.
Now, let's get to everything for the retailer.
Sincerely
George Matyjewicz, PhD
Chief Global Strategist, GAP Enterprises, LLC
mailto:georgem at gapent.com
http://www.etailersdigest.com
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[2] Online Retail Marches Ever Upward
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List member Jules Kaplan sent us this link...
eMarketer estimates that US online retail sales
rose by a hefty 25% in 2005, but when it comes to
online shopping, the old huckster's line, "You
ain't seen nothin' yet, bub," couldn't be truer.
"While the number of new Internet users in the US
and the total number of online buyers are both
growing at single digit rates, online sales are
experiencing double-digit increases," says
Jeffrey Grau, eMarketer Senior Analyst and author
of the new Retail E-Commerce: Future Trends
report. "Credit goes to baby boomers who are
increasing their online spending and a cadre of
digitally literate young adults who are replacing
older Internet shoppers in the e-commerce
marketplace. These demographic forces — coupled
with the spread of broadband access — are
changing the way people shop online and how Web merchants market to them."
Internet retail sales have increased at an annual
rate of more 24% for the last two years. Growth
will tail off over the next three years but it
will remain very robust, averaging around 20% per year.
"Web merchants responding to a June 2005 survey
sponsored by the online trade publication
Internet Retailer believe that certain population
segments will be instrumental in driving growth
in online shopping," says Mr. Grau. "Timesaving
convenience, a well-recognized benefit of online
shopping, was selected by 38% of respondents. But
more telling about the future of retail
e-commerce were the second and third most
frequently cited growth drivers: greater
acceptance and familiarity with the Internet by
adults (33.6%) and the maturation and growing
buying power of today's Web savvy teens and young adults (25.2%)."
The real force behind online sales growth is an elite segment of Web buyers.
Forrester Research data shows that Web buyers
look very different from average consumers.
Online buyers compared to average consumers are
four years younger, have 30% more household
income, are much more likely to have a college
degree and are 40% more likely to have a technologically optimistic outlook.
"The impact of young consumers on e-commerce is
visible in the way they share product
recommendations over the Internet," says Mr.
Grau. "For young consumers who like to hang out
in social networks such as MySpace.com or
Facebook.com product advice is an incidental part
of the chatter that is the main attraction. In
contrast with the structured form of product
recommendations found on Amazon, this is a fluid
and informal way of sharing opinions online about products and brands."
Marketers are exploring ways to tap into the
targeted audience delivered by social networks,
but this is relatively uncharted terrain. Some
retailers have tried to influence virtual
communities and ended up hurting themselves, marketing-wise.
Widespread broadband adoption, however, is having
an undeniably positive impact on e-commerce.
Nielsen//NetRatings found that broadband
consumers are likely to spend more dollars
online, convert from shoppers to buyers at a
higher rate, visit retail Web sites with greater
frequency and spend more time online.
Broadband connectivity is also enabling retailers
to deploy visualization and product enhancement
tools such as zoom, 360º views, virtual models
and product placement within a room. These new
tools are helping make shoppers feel more
comfortable in online showrooms — and drive sales.
See more of what online sellers have in store for
tomorrow's shoppers, read eMarketer's new Retail
E-Commerce: Future Trends report today.
http://www.emarketer.com/Report.aspx?shopping_feb06
Article at...
http://www.emarketer.com/Article.aspx?1003754
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[3] U.S. Holiday Sales Results
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The U.S.'s merchants, trotting out deep discounts
before Christmas, lured enough last-minute buyers
to deliver a decent, if unspectacular, sales gain of 3.2 percent in December.
The results, released yesterday, showed that
retailers, like Target, that waited until closer
to Christmas to flood shoppers with ads and
markdowns had the strongest December.
Indeed, chains like Wal-Mart that focused on
getting a jump-start on holiday sales before
Thanksgiving instead fell behind last month.
Wal-Mart, in particular, "had a competitive
advantage in November which they suddenly lost in
December, when other companies stepped up," said
Bill Dreher, a retail analyst at Deutsche Bank Securities.
According to the International Council of
Shopping Centers, consumers spent $93.2 billion
at retailers in December, up from $90.3 billion a
year ago. The 3.2 percent increase beat last
year's 2.7 percent gain for December, but fell
below a 4.3 percent rise in 2003.
But marketing tactics did not tell the whole
story. With home heating costs rising, retailers
that cater to lower- and middle-income shoppers,
like Kohl's and Sears, turned in largely
disappointing results. But higher-end chains,
like Neiman Marcus and Nordstrom, with shoppers
who are more insulated from energy prices, once again thrived.
A complete picture of the holiday season will not
emerge until the end of January after millions of
Americans redeem gift cards and retailers can then register them as sales.
What is more, monthly same-store sales, as they
are called in the industry, do not factor in
online sales. Web sales rose 25 percent this
holiday season, to $18.1 billion, through
Christmas, according to ComScore Networks. (Two
of the nation's largest electronics retailers,
Best Buy and Circuit City, will not report
December sales until they announce annual earnings later this month.)
After a strong showing in November, when sales
rose 3.6 percent, J. C. Penney also had a rather
weak December. Sales grew just 2.2 percent, below
a 2.7 percent analyst forecast.
Kohl's, which caters to the same lower- and
middle-income consumers as Wal-Mart and J. C.
Penney, missed analysts' forecasts, indicating
that lower-income consumers trimmed their
gift-giving budgets. (Sales at Kohl's rose 4.6
percent, below an expected 5.1 percent.)
"It's a demographic problem," said Dreher, the
Deutsche Bank analyst. "If you were focused on
the moderate-income sector, you were disappointed."
Sears Holding, the struggling combination of
Sears and K-Mart, failed to find its footing over
the holidays, with December sales sliding 11.9
percent. K-Mart delivered a 1 percent sales
increase after years of falling sales, suggesting
the bulk of the company's troubles rests with
Sears. In a statement, Sears Holding blamed a
"weaker-than-anticipated customer response to fashion offerings."
Target, the trendy discount retailer whose
typical shoppers earn far more than those at
Wal-Mart, said sales rose 4.7 percent. That was a
reversal from November, when Target's sales
growth dipped below Wal-Mart's for the first time in two years.
Federated Department Stores - still trying to
integrate the weaker May Department Stores into
its business - also turned around during the
holidays, posting a 3.4 percent sales increase in
December after a 3.4 percent decline in November.
Luxury retailers returned to their generally
strong growth last month after a sluggish
November. Sales rose 8.6 percent at the Neiman
Marcus Group, 7.7 percent at Nordstrom and 2.4 percent at Saks.
Fickle teenage shoppers, who fall in and out of
love with retailers seemingly every season,
mobbed stores that sold high-priced denim and
faux-fur-trimmed coats, increasing sales for the
segment by 12.9 percent, Retail Metrics found.
Sales at Abercrombie & Fitch, which shuns the
deep markdowns used by its rivals, leapt 29
percent. Sales at its relatively new Hollister
division, aimed at the middle-school set, jumped 36 percent.
Gap's hopes for a holiday turnaround, propelled
by a return to the basic crew neck sweaters and
knit scarves that endeared it to legions of
consumers in the 1990's, did not materialize.
Sales fell 9 percent across the chain: down 10
percent at Gap, 10 percent at Old Navy and 5
percent at Banana Republic. Morris, the analyst,
said Gap's decision to skip television ads for
the Gap brand in favor of a colorful magazine
insert hurt business. "As much as the company
said it did not drive big business, it became a
ritual," he said. "You saw it and kind of felt
like it was time to go to the mall, and it just wasn't there."
Article at...
http://www.iht.com/articles/2006/01/06/business/web.0106shop.php
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[4] The Consumer-Driven Store: 3rd Annual Store Systems Study Data Analysis
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How is the use of the POS evolving and what
impact will it have on store IT architecture in
the future? Should we expect the bullish years
of POS system sales to continue? For those
looking to make POS client decisions in '06, what
is also on their shopping list? Are retailers
happy with the ongoing wave of vendor consolidation?
Get answers to these questions and more when
Jerry Sheldon, Vice President of Technology, IHL
Consulting Group, presents results from a
comprehensive survey of how leading retail
executives plan investments in POS hardware,
software, peripherals and services. For the third
consecutive year, RIS News partners with IHL
Consulting Group, the leading research firm in
the area of store systems, to reveal these findings.
Additionally, don't miss the opportunity to hear
how retailers like the Virgin Entertainment Group
and others plan to invest in technology systems in 2006.
The Consumer-Driven Store: 3rd Annual Store Systems Study Data Analysis
When: Thursday, January 26, 2006 at 2:00 PM EST
Speakers: - Robert Fort, Director of IT, Virgin Entertainment Group
- Jerry Sheldon, Vice
President of Technology, IHL Consulting Group
Cost: FREE
Register:
https://risnews.webex.com/risnews/onstage/tool/event/event_detail.php?EventID=202005930
What You'll Learn:
*What new applications are retailers using at the POS?
*Are retailers planning to accept new payment
technologies like check or ID imaging?
*What is more important for retailers for
their next POS: inventory visibility or improved employee communications?
*Is Touch Screen the new user interface?
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