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Fierce Retail Holiday Report

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This week’s sponsor is Shoptalk.

Today’s Top Stories

1. Target pursues urban growth

2. Amazon captures 50% of retail sales growth

3. American Apparel closing more stores

4. Manic Monday sales soar 27%

5. RILA touts retail wins

This week’s sponsor is Leanplum.

Deliver holiday checkouts with these essential mobile tips. Download the guide now!

Also Noted

Inside Kohl’s technology center

Stories from around the Web

News from the Retail Industry

Editor’s Corner

Have a Merry after-Christmas

Thursday, December 24, 2015 | By Laura Heller

Anyone who attends trade shows and industry events has heard or said the phrase, “have a good show.” We tell each other to make lots of contacts and initiate deals, to take a lot of notes and bring back actionable information to grow future business.

But as important as a good show is, the after-show is far more important: following up on leads and finalizing those deals.

I’m reminded of this as the holiday selling season draws to a close, because this year it’s the after-season that will make or break the year for retailers.

Holiday shopping has been forever changed—by the recession, by technology and by a younger generation. Consumers start earlier, plan better and extend the holiday much longer.

They have the tools to compare prices and check inventory. They read reviews and crowdsource gift ideas in ways that make retailers’ hot lists and toy books seem obsolete. Even the Neiman Marcus holiday catalog seemed to fade into the background this year, upstaged by Amazon’s one-hour delivery and Instagram stars’ gift guides.

And the weeks after Christmas will matter more than ever. Shoppers are expected to receive gift cards in record numbers, and they will be ready to redeem them for goods and services. The incentives dangled in front of shoppers as promotions have limited windows for redemption (unless it’s a Macy’s $10 gift card), and those savvy self-gifters have done their research and know exactly when the best sales are for targeted items.

Shoppers are even still waiting to buy holiday gifts until after Christmas.

So while the season is soon officially over, it will be the after-show that counts as retailers close out their books. Have a Merry Christmas to be sure, but here’s hoping for an even merrier after-Christmas. -Laura

 


FierceRetail will be taking a publisher’s holiday and will return to its regular publishing schedule on January 4, 2016. In the meantime, be sure to check our websites for new content throughout our holiday.


Marketplace

Today’s Top News

1. Target pursues urban growth

Thursday, December 24, 2015 | By Laura Heller

Target (NYSE:TGT) will be adding a new small format in the Chicago market, the company’s fourth there, as it pursues urban markets with gusto.

The retailer will be taking over a 32,000-sq.-ft. store in the north side neighborhood of Lincoln Park currently occupied by Best Buy.

“Chicago is a priority market,” Target spokeswoman Kristy Welker told Crain’s Chicago. “With Target’s focus on growth in urban locations, the company is able to leverage its strength in flexible store design to fit stores into less traditional, smaller spaces to allow access to all of Target—regardless of store size.”

Chicago has also been a test market for Target as it tries to personalize its assortment with items tailored to local needs. The company’s new downtown location even obtained a liquor license and serves food and adult beverages to shoppers.

Target has 18 smaller format stores and plans to open 14 more, Welker said. It’s all part of the retailer’s push into urban markets as big box chains try to make themselves small in a quest for growth.

Flexible formats are a big focus for Target CEO Brian Cornell. Originally developed under different banners—TargetExpress and CityTarget—all formats large and small have been rebranded under the Target banner.

For more:
-See this Crain’s Chicago article
-See this Minneapolis/St. Paul Business Journal story

Related stories:
Report: Target is developing a mobile wallet
Target’s Wonderland jingles RFID bells
Target scouts innovators in retail accelerator program
Target opens connected home showroom
Target releases fresh merchandise in rapid-fire 2015 overhaul

2. Amazon captures 50% of retail sales growth

Thursday, December 24, 2015 | By Laura Heller

Amazon (NASDAQ:AMZN) now accounts for roughly 50 percent of all online retail sales growth in the United States and 24 percent of total retail sales growth, according to Macquarie Research.

By the end of 2015, Amazon’s U.S. sales will be $88 billion, a 33 percent jump from 2014’s $66 billion, estimates Macquarie analysts.

For every $1 of e-commerce growth this year, Amazon will take 51 cents and 24 cents of every $1 of total adjusted retail growth. “Think about the inverse of that: Every other retailer is fighting for 49 cents and 76 cents of each dollar, respectively,” note analysts in a research note.

Amazon captured 35 percent of online sales on Black Friday, according to Slyce, and 51 percent of U.S. shoppers planned to buy from Amazon this holiday season, according to a poll from Reuters/Ipsos. That number is consistent with Macquarie’s projections for 2015.

And there’s no expectation that Amazon’s growth will slow. It’s quite the opposite, thanks to Amazon Prime.

A stunning 25 percent of U.S. households are currently Prime members and by 2020 that number will grow to 50 percent, estimates Macquarie. Amazon likely added 7 million households as Prime members in 2015, thanks to the company’s addition of new services such as award winning original content and new streaming services.

“We believe that Amazon thinks its strategy of bundling in more and more benefits for Prime members (video, music, books, photo storage, etc.) is a key reason for the Prime growth,” according to the report. “Therefore, we expect Amazon to continue to ramp up its benefits for Prime.”

Related stories:
Inside Amazon’s urban warehouse
Amazon Fire sales are on fire
51% of holiday shoppers will buy on Amazon
Amazon opens first store
Amazon adds Streaming Partners Program

3. American Apparel closing more stores

Thursday, December 24, 2015 | By Laura Heller

American Apparel wants to close more stores as it moves forward with a plan to reorganize under Chapter 11 bankruptcy protection.

The troubled retailer has petitioned the bankruptcy court to close nine stores, including the company’s very first location in the Echo Park neighborhood of Los Angeles, according to Women’s Wear Daily.

Additional stores scheduled for closure include three in southern California and two in the New York City market, including Jersey City, New Jersey and Norwalk, Connecticut. American Apparel also requested permission to close stores in Madison, Wisconsin and Tigard, Oregon.

All locations are slated to close on Jan. 30, according to the Silicon Valley Business Journal, and follow an earlier request to shutter nine units.

American Apparel is struggling to emerge from Chapter 11 following a tumultuous period marked by executive in-fighting between the board of directors and founder Dov Charney.

Charney was fired in December for alleged misconduct, including the misuse of funds and sexual misconduct with other employees. He and other shareholders will lose their stake in the company. Charney owned a 42 percent stake in American Apparel and was also the biggest creditor, holding $15 million in debt.

Charney has filed several lawsuits against the company, which will likely be delayed due to the bankruptcy.

For more:
-See this Women’s Wear Daily story (subscription required)
-See this article in the Silicon Valley Business Journal

Related articles:
American Apparel files for bankruptcy, wipes out Charney
American Apparel needs cash, risk of bankruptcy
American Apparel to close stores, cut jobs
American Apparel sues former CEO Charney
New American Apparel CEO puts focus on order, discipline

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