Author: Helen Thomas

In a report released by Price Waterhouse Coopers, it provided an overview of what will challenge retailers in 2015. The reports focuses on what retailers and suppliers must do to satisfy the needs of their customers in order to be successful and profitable in an ever-changing, customer-centric environment.

Targeted Collaboration between retailers and suppliers is listed as a key component for success. To achieve better alignment of goals and drive greater efficiency, retailers and suppliers need to become trading partners, sharing details and processes on product launches, trade promotions, inventory management and supply chain operations.

Technology greatly contributes to improved operational efficiency, and there will be a need to effectively manage the business through business intelligence. Customer demand-based management can only succeed with real-time POS sales, inventory and consumer data information. Retailing will become more personal and customer data and relationships will become a key asset for retailers.

Source: Price Waterhouse Coopers

TJX Companies revealed in their annual report net sales for the past fiscal year were $29.1 Billion. This is greater than Macy’s report of $28.1 Billion. This marks a 6.2% sales increase for the year, and 4^th quarter earnings jumped 15%.

TJX Companies operates retail stores in the US as T.J.Maxx, Marshalls and HomeGoods, and recently added Sierra Trading Post. In Canada, they operate Winners, HomeSense and Marshalls. In Europe they have T.K.Maxx and HomeSense. The company sources from more than 16,000 vendors in 75 countries.

The retailer features brand-name merchandise at value prices. Because the company has aggressive inventory management, assortments change quickly and customers have learned to buy what they like when they see it. Their offerings are unique, timely, attractive and at a perceived value. Other major retailers are taking note and they want a piece of the off-price action.

Shares of some top department store retail companies were mixed at the close of trading yesterday, March 9:

Kohl’s Corp. rose $.80 or 1.1 percent, to $73.71.

Macy’s Inc. fell $.42 or .7 percent, to $62.56.

Nordstrom fell $.52 or .6 percent, to $80.34.

J.C. Penney Co. fell $.32 or 4.2 percent, to $7.33.

Sears Holdings Corp. fell $1.80 or 4.6 percent, to $37.21.

TJX Companies rose $.20 or .3 percent, to $68.23.

Source: Forbes.com and Yahoo Finance

Sephora announced several strategies and technologies focused on omnichannel retailing, for both in-store and mobile shopping.

The first is “Sephora Flash”, an Amazon Prime style subscription service, offering customers free 2-day shipping on all products for $10 per year. The Flash will be free for their Rouge Beauty Insider members, who spend more than $1,000 in a calendar year.

Second is “Augmented Reality”, allowing customers to engage with custom content by placing their phone over the images of the nine female founders found in the retailer’s windows and display cases. Launching in April, scanning the images will show content options, such as interviews and product videos. The stores will also deploy beacons that a customer can opt-in on, receiving birthday alerts, loyalty program updates and events happening in the store.

Sephora is also launching “Pocket Contour”, a new mobile app, where a customer can upload a photo of herself and get personalized face contouring advice and product recommendations.

In their San Francisco corporate hub, Sephora has created an “Innovation Lab”, where the Sephora team can brainstorm and test ideas in a think-tank environment and the company can groom future management.

We’re completely focused on making shopping more efficient, intelligent and fun for our clients,” said Julie Bornstein, chief marketing and digital officer for Sephora.

Source: Retailing Today

The National Hardware Show, the largest industry event for home improvement retailers around the world, will be introducing an auction concept this year: The Outdoor Supply Auction.

The show, taking place at the Las Vegas Convention Center May 5-7, will host the auction in a 50,000 square foot arena. The North American Retail Hardware Association (NRHA) is co-sponsoring the show.

Show attendees can attend the auction for free. It will give attendees opportunities to bid via a mobile app on hundreds of different product lots of new, overstock, discontinued and seasonal and package changed products from all categories. Categories include plumbing and electrical, homewares, paint and accessories, hardware and tools, outdoor and recreational, and lawn and garden. Attendees can use the mobile app to preview, bid and get instant updates real-time.

The National Hardware Show exhibitors are provided this sales opportunity. In addition to immediate sales and new customers, those that participate in the auction have the option to receive real-time leads from attendees who preview their product detail and from buyers bidding on their product during the 3-day auction event.

Source: HardwareRetailing.com and NationalHardwareShow.com

The 100-year-old Florida based Bealls, Inc. announced plans to launch a specialty store concept in 2015, named “Bunulu”.

“Bunulu is an Aboriginie name that means a place of water,” said Lorna Nagler, president, Bealls Department Stores, in a report by the Bradenton Herald. “Our tagline for our store is Land, Water and Style.”

Bunulu will open 3 to 5 stores in the fall, and the stores will average 4,000 sq. ft. The stores will target a younger demographic, featuring coastal-inspired lifestyle apparel and accessories. They will feature national brands. It already has its own website, Bunulu.com.

The brand’s website describes Bunulu as the “next generation of outdoor active lifestyle brands. Personalized for the coastal lifestyle.” Based on the site’s renderings, the stores will have a casual atmosphere, with wood floors and shelving and beach décor accents.

Source: Retailing Today

Retailers are striving to minimize return rates and maximize customer satisfaction. In a recent survey from Voxware, it was revealed that 57% of consumers are returning items they purchased online. 42% noted the products they received were in the wrong size or color and 15% said they received the wrong product altogether. Nearly 20% of consumers say they received an incorrect item a second time.

By analyzing return data, retailers can gain a better understanding of consumer preferences and behavior, as well as survey their internal supply chain and warehousing abilities.

Retailers are focusing heavily on omnichannel. Customers expect to buy what they want, how they want, when they want and have it delivered quickly to wherever they want them. Consumers can order online and pick up in a store, order from a brick and mortar store and have it shipped to them or the store, and order directly online. This requires store operations to effectively manage picking and shipping, turning each store into a warehouse.

Retailers need to analyze their business processes though POS and return data to drive sell-through velocity, margin improvements and customer loyalty.

While customers may be willing to forgive retailers after one return experience, 45% of respondents stated that they have limited their shopping with the retailer – both online and in-store after a second return.

Resources: Retail Touchpoints, Multichannel Merchant

Hudson’s Bay Company, which has 90 locations, two outlet stores, thebay.com and is the parent company of Saks 5^th Avenue and Lord & Taylor, is forming two joint ventures valued at $4 billion to bring more value to its property portfolio.

The company has entered into agreements with Simon Property Group Inc. and RioCan Real Estate Investment Trust. These joint ventures will enable them to build on the strength of its existing real estate assets and identify new real estate growth opportunities.

The transactions position HBC’s retail business for continued growth, the company said, while providing increased financial flexibility. The approximately $1.1 billion in expected cash proceeds from the joint venture transactions, net of expenses, will be used to reduce debt on HBC’s balance sheet, the company said.

“I am truly excited by these partnerships and what they mean for the future of HBC,” said Jerry Storch, CEO, Hudson’s Bay Company. “A stronger balance sheet and enhanced financial position will enable us to invest in growth initiatives across our retail business, including strengthening the connection between our store and digital businesses, expanding our off-price channel and investing in our world-class store base.”

Source: Retailing Today

Retailers have much more sophisticated tools for in-store analytics of customer behavior, but a study conducted by Forrester Research, Inc. revealed pitfalls and recommended key actions for retailers to take to achieve success with in-store analytics.

Legacy store analytics only has allowed for slow reaction and limited breadth of activity measurement in traffic counting, merchandise productivity, labor management, loss prevention and shopper studies. Increasing use of analysis of smart mobile devices, wi-fi and surveillance technology creates an opportunity to address layout optimization, merchandise productivity and labor management coupled with customer behavior, proactive loss prevention, marketing attribution and store marketing performance.

For retailers to successfully utilize this technology, they should take some specific measures. First, address privacy concerns of the customers and be transparent. Nordstrom attempted to deploy in-store analysis in 2013 and it resulted in enough customer complaints to cause the company to cease implementation. Next, rather than simply measuring store traffic, measure the conversion rates of customers who enter the store – for example, improve practices of window display effectiveness and how it relates to store traffic.

Most important is to involve many teams, from store operations, merchandising, asset protection, and marketing, to use the analytics in cooperation. Retailers must merge store analytics with traditional retail data — including staffing, inventory, customer lifetime value, online customer behavior, weather, environmental conditions and existing historical behavioral data — into an enterprise data warehouse (EDW) to transform physical store operations. Retailers need to empower and train associates, local store managers, and regional managers to act locally with insights and provide staff with real-time guidance.

Source: Retailwire.com

The American Consumer Satisfaction Index (ACSI) reports that consumer satisfaction with retail is on the decline for the first time in four years.

The ACSI report states brick-and-mortar customer satisfaction fell flat or weakened, while Internet retail is up from last year. By category, overall satisfaction with department and discount stores stayed flat at 77, while the gap between best- and worst-ranked companies grew. Nordstrom was the top rated, gaining 4% to 86. They are followed by Dillard’s (81), Kohl’s (-1% to 80) and Macy’s (79). Walmart dropped 4% to 68 and is at the bottom of the category behind Target (+4% to 80), Meijer (78) and Sears (-5% to 73).

Among home improvement chains, Lowe’s rated best at 81, while Home Depot falls to the category’s bottom dropping 4% to 76.

Amazon remains at the top of the Internet sector, at 86. Netflix improved for the third straight year gaining 3% to 81. Overstock and eBay both dropped to 77 and 79, respectively.

The ACSI is a national economic indicator of customer evaluations of the quality of products and services available to household consumers in the US. The ACSI uses data from 70,000 customers annually for measuring satisfaction with more than 230 companies in 47 industries.

Resource: Retailing Today

Despite disappointing end of 2014 sales, Fossil is focused on the future, announcing Tuesday that it has reached a ten year licensing agreement with Kate Spade, assuming its existing watch business.

Fossil CEO Kosta Kartsotis called the agreement, “yet another great example of our ability to capitalize on lifestyle brands that are poised for global expansion.” The company already has partnerships with brands like Giorgio Armani, Michael Kors, Tory Burch and Emporio Armani Swiss.

Sales in 2014 were flat at $1.07 billion, missing their estimate of $1.12 billion.  Best known for its watches, this segment pulled in more than three quarters of the company’s total revenue. Jewelry sales increased but only accounted for $93 million of the total revenue.

The company is forecasting a sales decline of 5.5%-7.5% in the first quarter of 2015. “We are not entirely satisfied with our fourth quarter performance and begin 2015 intensely focused on taking advantage of the many opportunities available to us to drive future growth,” said Kartsotis.

Resource: Forbes