If you haven’t figured it out by now, I am a bit of a retail nerd. I am the type of person that looks forward to brands making headlines, and strategy announcements from earnings calls. So with that in mind, I thought I would update you on what’s been said the past couple of weeks regarding Gap, JCPenney, SJP, Dillard's, and Costco. Let’s get to it…
Gap Inc. saw a 1% increase in their Q4 revenue this year, but much of that success came from their Old Navy division- who had it’s fifth year of consecutive growth. And although I am very happy for Old Navy (and Athleta whose also performing well), their Gap and Banana Republic divisions are still struggling. Which means more store closings and product adjustments are in their future. CEO Art Peck, who has been with the company for two years, has always had a comeback plan for the brand. And while I may be completely naïve, I am still hoping he can make that happen. I hate seeing Gap and BR closing stores- but if they can hone in on their brand identity, maintain some consistency for customers, and decrease their lead times- we might see a turnaround. Gap in particular has the history, price points, and casual DNA that most people can relate to. My fingers are crossed for you in San Francisco… #makeacomeback
JCPenney was in the news for their 2016 net income- which I will be honest I had to read three times to be sure I got it right… The company saw a $514 million increase over 2015 with comp store sales in the fourth quarter only down 0.7. And although they too will be closing over 100+ stores this year- they are focused on growing key categories such as beauty (Sephora), activewear (Nike and Adidas), toys, women’s plus sizes, appliances/ home, and of course on-line. JCPenney’s CEO Marvin Ellison said that they have made one of the greatest financial turnarounds in history- and he’s probably right. He reminded everyone that 2016 is the first time in six years that the company has seen a positive net income, and that there was a time when they reported a loss of $1.3 billion. So although many reports are focusing on the negative (store closings)- I say enjoy this moment. Best of luck, JCP.
Sarah Jessica Parker, who currently has a successful shoe and fragrance line, launched a new handbag collection this month titled The Seven Essentials. You can currently pre-order them at bloomingales.com and the pricing ranges from $395- $695. The collection (similar to her shoes) are timeless, high quality (leather made in the USA), and versatile. The “Jackie” crossbody in black, the “Goya” clutch in pink, and the “Amie” slouchy tote in grey are my personal favorites.
CNN recently announced America’s favorite retailer- and for the first time in years, Costco didn’t win it outright. Dillard’s surprised everyone and tied Costco for the first place spot, and received an 83 out of 100 from shoppers. This was based on the 2016 American Customer Satisfaction Index, which encompassed ratings from 12,000 people. And although this may not be “big” news, I was excited to see a department store take the lead given how tough business is right now.
And speaking of Costco- the company announced yesterday that they will be increasing their annual membership fees by $5 and $10 due to disappointing revenue results. The company saw a 5% decrease from the prior quarter while comp store sales were still 3% positive over last year. The "disappointment" came from not hitting their plan and/ or the analysts predictions. I am hoping, however, that Costco’s membership hike (which effects about 35 million people) will help them get back on track due to the increased competition from Walmart and Amazon. As for the membership fee, I personally don’t see it deterring customers- as those of us who shop there know the quality standards and customer service make it worth while.
Okay- I know that was a lot but I hope you feel a bit more informed on what’s happening within retail. If you think I missed anything or just want to let me know your thoughts, please comment below, I would love to hear from you. Enjoy your weekend everyone!