With Christmas just three days away, US and European retailers face a tumultuous end to a protracted and mostly disappointing holiday shopping season.
Friday, December 23rd is set to be the second busiest shopping day in the US this year, after Black Friday, according to data firm Sensormatic Solutions. So far, shopper visits to many retail segments, including apparel and electronics, have declined year-on-year, according to Placer.AI’s foot he traffic data.
RJ Hottovy, Head of Analytics and Research at Placer.AI, said rising food, gas and rent prices are forcing consumers to become “more selective.”
Shoppers are buying less electronics, furniture and some types of clothing than they did a year ago, according to market research firm NPD Group. , down 5% year-on-year.
Many stores hung discounts early in the season to lure inflation-weary consumers and clear inventory.
According to Placer.AI, among the losers so far are fast-fashion retailer H&M, which took too long to raise prices, and department stores such as Kohl’s and Best Buy, which experienced dramatic losses of at least 15% of foot traffic. showed a decrease.
Analysts and experts say this season’s winners are likely to include beauty and skincare sellers such as Ulta, mid-range luxury accessory and handbag retailers, and stores that have cleared excess inventory. That’s what I mean.
Fast-fashion chain Zara has aggressively raised prices this year without stopping shoppers, and 100-yen stores, including Dollar General, have expanded their product offerings.
Hilding Anderson, head of North American retail strategy at digital consulting firm Publicis Sapient, said the beauty category is an “affordable splurge” as people look for makeup and fragrances they can wear to the office or to parties. said.
Sephora’s biggest rival, Ulta, has boosted its annual sales and profit forecasts after attracting customers with budget-friendly beauty products, deals and an expanded partnership with Target.
Ulta “proves to be not only a more resilient name in beauty, but a name with momentum,” said Piper Sandler analyst Korinne Wolfmeyer.
One-dollar stores are gaining momentum as more consumers drop in prices. According to Placer.AI’s foot traffic data, visitor numbers at the discount store and his 100-yen shop increased by 1.1% year-on-year and 7.8% compared to Super Saturday in 2019.
Dollar General’s effectiveness in offering more food, holiday decorations, and sock stuffers was proven as customers purchased a $35 Christmas tree and $1.25 ornaments.
Clothing retailers face higher costs in both material and shipping costs, while Zara owner Inditex sells more expensive clothing and otherwise spends money in luxury stores. It outperforms its competitors by attracting shoppers who might otherwise have used
“Zara’s more premium positioning has helped in the current environment,” said RBC analyst Richard Chamberlain.
The world’s largest fashion retailer said Wednesday that sales grew 12% year-over-year in the first five weeks of the fourth quarter, which began in November.
Why the Fashion Inventory Problem Recurs (and How to Fix It)
A combination of shipping delays and consumer misjudgment of demand has resulted in a pile of goods. Retailers are using a combination of discounts and more creative means to draw them back.