Online sales are putting a dent in brick-and-mortar retailers

From Victoria’s Secret to Macy’s, brick-and-mortar retailers took it on the chin this holiday season, while online sales jumped nearly 20 percent.

One notable exception: Gap Inc., which seemed to benefit from demand for bargains as same-store sales spiked 12 percent at its low-price Old Navy chain, contributing to a 4 percent comp-store gain overall for November and December, and sending Gap’s stock soaring.

Overall, however, so many shoppers shunned brick-and-mortar stores that sales plunged 10.3 percent in December, and traffic declined even further, according to RetailNext, which analyzes shopping trips across specialty and large-format stores nationwide. Sales dipped 0.4 percent during the same period in 2015, an easy comparison stores still couldn’t beat.

This is the beginning of the end for a lot of retailers — or at least the beginning of a major conversion of their platform, from brick-and-mortar with a small online presence, to a large online presence with a limited brick-and-mortar base,” said Peter Schaeffer, a principal at financial advisory firm GlassRatner.

The National Retail Federation expects holiday sales, excluding cars, gas and restaurants, to rise 3.6 percent, to $655.8 billion, for 2016. But it was a season of stark contrasts, with online sales expected to surge 19 percent, to roughly $98 billion, even as sales and profits slumped at thousands of traditional stores.

Sales were volatile throughout the holiday season,” said Kohl’s Chief Executive Kevin Mansell. “Strong sales on Black Friday and during the week before Christmas were offset by softness early in November and December.

This pattern played out at many stores. The Friday before Christmas emerged as the top day for sales in the November-December period, knocking Black Friday out of its traditional spot and into second place, said RetailNext. A last-minute bump of 6.5 percent in the week before Christmas was too little too late.

Poor holiday sales can lead to layoffs and store closures, like those announced last week by Macy’s and Sears. January is also a common month for retail bankruptcy filings.

Here, a snapshot of brick-and mortar chains that slumped during the holidays:

  • Macy’s: Same-store sales slid 2.1 percent in the November-December period, denting profits and the stock price, and prompting a massive restructuring. Macy’s said last week that in the fourth quarter, it will take a $250 million charge — on top of $249 million charge in the second quarter — for restructuring, including slashing 10,000 jobs and closing 100 stores in the next few years. Macy’s, which operates 730 Macy’s locations, slashed its estimates for earnings per share before special charges to a range of $2.95 to $3.10, from $3.15 to $3.40.
  • Kohl’s: Same-stores sales slid 2.1 percent in November and December. The retailer, which operates more than 1,100 stores, slashed earnings expectations to $2.92 to $2.97 per share, from $3.12 to $3.32.
  • Barnes & Noble: Same-store sales fell 9.1 percent for the nine weeks ended Dec. 31, and the company, which has 638 stores, slashed its full-year sales forecast.
  • Victoria’s Secret: Same-store sales slid 4 percent in December at the L Brands unit, which operates 1,001 stores.
  • The Limited announced — ironically on its website — late Friday that it was closing all 250 of its stores, but would continue its online operations. Its owner Sun Capital Partners had no comment.

The broadest challenge facing stores comes from online retailers — the clear winners this year.

Amazon set the pace with its popular voice-activated Echo devices and one-hour delivery service in some cities. The e-tailer is expected to post strong profit margins following robust sales of Echo and fewer holiday-season bottlenecks at its fulfillment centers, Morningstar analyst R.J. Hottovy said in a note.

In addition to Gap, L Brands’ Bath & Bodyworks division logged gains, with December same-store sales up 3 percent. And although Barnes & Noble’s comps plunged, CEO Len Riggio said cost controls will help boost operating profits.



‘Black November’ Serves up Highest Mobile Website Traffic in ’16 And Doubles the Sales for Independent Retailers

SCOTTSDALE, Ariz. — For independent retailers of durable home goods, Black Friday 2016—as well as the month of November—saw significant increases in online traffic, mobile use and sales over last year’s Black Friday holiday, according to Retailer Web Services (RWS), which began tracking comprehensive Black Friday stats on its network of retailer customer websites in 2015. The software solutions company has released the following results and analysis as of Nov. 30, 2016:

– The percentage of site visits from mobile devices nearly doubled from last year, 51 percent last month, compared to 27 percent in November 2015.

– Black Friday remained the No. 1 day of the year for overall traffic, sales and quote requests generated for the second year in a row.

– The amount of November sales RWS retailer customer sites generated for these local businesses more than doubled year over year: more than $43 million in ’16; $21 million in ’15.

– In 2016, 24 of the 30 days with the highest traffic were in November, reinforcing that it’s “Black November” now, according to RWS.

– In both 2015 and ’16, Thanksgiving Day was the No. 1 day of the year for mobile traffic.

“Year over year, not only were more people looking at our retailers’ websites in November, a considerably higher percentage were looking at them on smart phones,” said RWS Chief Operating Officer Jennie Gilbert. “These results show the shift to mobile in consumer online shopping behaviors—and the need for independent retailers’ sites to not only accommodate the mobile shopper in an engaging relevant way, but to win their business.”

For those RWS retailer customers with Level 4 WebFronts, there were many Black Friday digital deals to be had for consumers—more than 4,000 promotion landing pages—across the RWS network on the biggest names in home appliances and mattresses. The digital promotions that ran between Oct. 30 and Nov. 30 resulted in:

– Thousands of phone calls placed directly from mobile websites to independent retailers; hundreds of GPS navigations directly to the physical stores from mobile sites.

– More than 71 million banner views to retailer websites’ home pages.

– More than 2.5 million landing pages visits

– Navigation to nearly 2 million individual products associated with the promotions

– More than 33,000 rebate forms downloaded

During the busiest shopping holiday of the year, Sarah Richardson of KAM Appliances, a family-owned discount appliance store based in Cape Cod, Mass., made use of KAM’s Level 4 WebFront to keep track of online campaigns. “With three store locations (Hyannis, Nantucket and Hanover) and a variety of marketing programming going on, everything leads back to our website,” said Richardson. “Level 4’s best tool is the marketing analytics; we’re able to track the activity from the mobile site, how many emails are opened, rebate forms and more.”

‘Black Friday’ has ominous history

Article Source: “Black Friday” and “Black Monday” entries in The Oxford English Dictionary.

YOU say you shopped for Christmas bargains November 25, Black Friday. Or not! You couldn’t buck the crowd, right? The term, “Black Friday”, originated, it seems, in 1951, in reference to the congestion caused by hordes of shoppers in Philadelphia, and later as a day on which retailers’ sales accounts went from red to black.

And on the negative side, an industry publication, “Factory Management & Maintenance” complained, “Friday-after-Thanksgiving-itis is a disease second only to the bubonic plague in its effects. When you decide you want to sweeten up the holiday kitty, pick Black Friday to add to the list.”

A “Black Friday” occurred as early as the year 1610, in England. Not a day of shopping, students dubbed it examination day in the nations’ schools.

Black Fridays have long been a bane in both England and America. Friday 6, December, 1745, was the date on which the landing of the Young Pretender to the English throne, Bonnie Prince Charlie, was announced in London. Black Friday was the name given to May 11, 1866, the day on which a commercial panic caused the failure of the London banking house, Overend, Gurney, & Co.

Black Friday, September 24, 1869, a day of financial panic on Wall Street, brought on by the introduction into the financial market of a large quantity of government gold. In 1970, in remembrance, W.W. Fowler wrote, in Ten Years in Wall Street, “The sun rose up lightly and brightly on the morning of that black-Friday, September 24, 1869, as though the day were to be a jocund one.”

The Sunday Mail, Jan 25, 1991: “Practically no one foresaw that money and share prices in 1987 had reached dangerously high levels. ‘Black Monday’, October 1987, The Federal Reserve had to promise to supply enough money to keep business going.”

The Wall Street Journal November 27, 2006, reported, “Despite aggressive discounting throughout November and on Black Friday, WalMart Stores Inc. reported its weakest monthly sales in more than 10 years.” In 2009, Black Friday bankrupted investment houses and caused 25 suicides in New York City.

Let’s not stop with Black Fridays. We have had Black Mondays too. A popular belief in the unlucky character of Mondays is shown in British sources from the Old English period. In 1600, Shakespeare, in Merchant of Venice: “It was not for nothing that my nose fell a bleeding on black monday last.

Easter Monday 1916 was dubbed Black Monday in remembrance of the extreme cold on April 14, 1360, when large numbers of Edward III’s army died standing before Paris in severe frost.

In 1997, the publication “Big Issue,” June 9 reported, “Yuppie culture was predominantly an Eighties phenomenon, reaching its apogee with the Big Bang of October 1986, and its nadir with Black Monday a year later.

Whether Friday or Monday, black has colored a day of financial collapse, natural disaster, terrorism, military defeat, and, of course, shopping.

November Auto Sales: Black Friday & Cyber Monday Bounce

After months of downward swings in sales, the U.S. auto industry finally got a breather in November. Between Black Friday incentives, the 2016 election being resolved and the month of November boasting two more selling days in 2016 than it did in 2015, things are looking up.

The reversal was not dramatic, but it’s a good sign that the summer/fall slump was only temporary.

Phil LeBeau, reports on a “good, but not great” weekend for autos, and November auto sales expectations.

GM and Ford both posted great numbers in November. Only Buick remains up YTD for the General, but not a single brand failed to post a double-digit improvement last month.

FCA, on the other hand, took a bit of a beating. Ram bucked the trend, posting another good month, but the others struggled.

Across the industry, numbers were generally good. Mazda continues to be stagnant, slipping slightly compared to 2015. Volkswagen had a solid month, keeping well ahead of the numbers that marked the beginning of its inventory struggles a yea ago.

In the luxury space, Mercedes-Benz finished just ahead of Lexus with BMW trailing by a few thousand. Barring a December holiday miracle, we expect that’s where they’ll finish for the year.

Auto sales drive to record high in November 2016. November 2016 was quite an eventful month for the U.S. & Indian automotive sector.

Black Friday And Cyber Monday Don’t Matter As Much As November

Black Friday, Cyber Monday, Thanksgiving Day, now & –- what does it all mean?

Well, pretty much nothing. Traditionally, Black Friday was the day that retailers, well, got back in the black. And, for the most part, was the first real promotional shopping day of the holiday season. It wasn’t until recently that Black Friday & Cyber Monday even became known as the busiest shopping day of the year – that title was held, and probably now will be again, by Cyber November or Black November. You can blame Internet for that, as promotions have been released to all of November.

The more the sales and promotions are spread by Internet the more dilution you can expect to see across the November. Which is of course absolutely fine, but simply put, we need to dial back the hype at the same time. Over the past several years, every time Black Friday & Cyber Monday sales slipped or traffic was reportedly down, we tend to act like Chicken Little – but that needs to stop. For better or worse, Black Friday And Cyber Monday is now Black November or Cyber November – regardless of the channel the sales are on – and we should begin to react accordingly.

We also get peppered over the course of this month with the barrage of online vs. in-store sales comparisons. The fact that Internet sales grew at a double-digit pace does not surprise me. Throughout the year, the percent growth of Internet sales is also in the double digits. The fallacy is in trying to compare percent growth of Internet sales to percent growth of in-store ones. Internet sales are still in their nascent stages compared to traditional brick and mortar sales and are therefore operating off a much smaller base. When you calculate percent growth off a much smaller base, it’s far easier to have more impressive numbers.

“Every day of November is going to be ‘Cyber-something,'” Youssef Squali, global head of internet and media equity research at Cantor Fitzgerald, told CNBC’s “Squawk Alley” on Tuesday. “Today’s Cyber Tuesday. Tomorrow’s Cyber Wednesday. What this tells you is: What started before as one day where you can get the best deals has transformed itself into a week, maybe several weeks … where we’re getting better and better and deals.”

Black Friday shopping hit a new sales record of $3.34 billion, with Cyber Monday on track to hit $3.45 billion, according to Adobe Digital Insights. The shopping surge comes even as companies like Macy’s advertise “Cyber Week” and Jeep offers its Black Friday sales through the entire month.

Sales on Cyber Monday increased 12.1 percent over the prior year, to $3.45 billion, according to Adobe Digital Insights. That handily topped the firm’s projection for 9.4 percent growth, despite greater-than-expected sales on Black Friday.

Separate data from the National Retail Federation‘s consumer survey found that 6 million fewer people visited stores this Black Friday weekend, while 11.3 million more shopped Online. In total, 108.5 million people said they shopped Online, compared with 99 million who said they did so in stores. Bricks-and-mortar stores still account for the lion’s share of overall sales.

As We’ve seen, Black Friday & Cyber Monday 2016 was a smashing success financially, both in the U.S., Canada and in the U.K. Black Friday & Cyber Monday still looms tomorrow, and it’s safe to say that many consumers aren’t quite done with their November holiday shopping. Next year, would November sales figures once again break records in both sides of the Atlantic? A lot can happen before then, but the stats don’t lie — there are still scores of people around the world who believe Thanksgiving week is the time to be thankful for big discounts.

Consumer Spending in the United Kingdom increased to 307503 GBP Million in the third quarter of 2016 from 305664 GBP Million in the second quarter of 2016. Consumer Spending in the United Kingdom averaged 162492.11 GBP Million from 1955 until 2016, reaching an all time high of 307503 GBP Million in the third quarter of 2016 and a record low of 65075 GBP Million in the second quarter of 1956. Consumer Spending in the United Kingdom is reported by the UK Office for National Statistics.

Say Hello To Cyber November or Black November! Sales booming out early November than ever blanking the Internet and the shopping mall. Amazon, Walmart, Best Buy, Louis & other online & traditional retailer offering Black Friday & Cyber Monday discount the whole November.

Further to that end, the ICSC survey from November suggests that 80 percent of all spending from the Month went to retailers that have physical stores. Additionally, almost 30 percent of shoppers utilized buy online and pick-up in-store options. So the role of the physical store would seem to be inextricably tied to the success of digital shopping channels.

What this means to me is that the blurring of lines between retail channels is greater than ever before – and to be successful in today’s landscape, limiting yourself to a single option would seem foolish. However, at this time of year, the drumbeat seems to be to pit one versus the other in some sort of retail cage-match of nostalgia (brick and mortar) vs. progress (digital commerce).