Mediapost sent out this tidbit of information. Smart businesses are able to adapt and gain when the marketplace shifts. And this was not a sudden shift so you should have been prepared. The "floating question" however is what is a "need" in 2008. Ten years ago a cellphone was on the "want" list. Can you predict what will move from "want" to "need" this year? Here's the results:
| January Sales Stink, As Consumers Sort 'Wants' From 'Needs' | |
| by Sarah Mahoney, Friday, Feb 8, 2008 10:34 AM ET | |
| WHILE THE SAME-STORE SALES OF major U.S. retailers actually picked up a smidge from December, the overall weak results are giving retailers more clues about what's weighing on consumers' minds: Necessities are in, and anything else isn't. "Gift card redemptions were below expectations, and customers appear to be holding gift cards longer and using them more often for food and consumables rather than discretionary purchases," Wal-Mart says, in announcing that its same-store sales gained 0.2% for the four-week period. Sales at drug stores and warehouse clubs gained, but in every other category, consumers just weren't spending. In fact, it was the worst January sales results since 1970, reports the International Council of Shopping Centers, with same-store sales growing 0.5%, compared to the previous year, according to ICSC's index. "Gift cards left over from December failed to buoy the month's sales as they have in previous years," ICSC says. "With uncertainty about the economy, and the possibility of a recession, consumers have pared their spending. Looking forward to February, we expect much of the same." "People are still buying food," says Ayuna Kidder, an economist at TNS Retail Forward, a Columbus, Ohio-based retail consultancy, "but for everything else, they seem to be waiting." TNS also tracks sales result, and its index showed sales inching up to 1.0% from the prior month. Its sales-weighted composite is up from a 0.2% reported last month and down from the 4% composite reported in January 2007. No matter how you index the results, there aren't many winners. Target's sales fell 1.1%. And while both Saks Fifth Avenue (up 4.1%) and Neiman Marcus (up 3.3%) showed increases, same-store sales at practically every other department store took a header. At Dillard's, sales fell 12%, at Kohl's Corp., 8.3%, at Macy's, 7.1%, and J.C. Penney, 1.9%. Even the chi-chi Nordstrom struggled, with sales sliding 6.6%. Shoppers also shunned specialty retailers. Same-store sales at Limited Brands, which owns Victoria's Secret and Bath & Body Works, dropped 8%, and sales at the Gap fell 2%. Some teen retailers struggled (sales at American Eagle Outfitters slipped 7%, Wet Seal, 5.7%, and Hot Topic 3.6%.) Abercrombie & Fitch managed to come in flat, and at Aeropostale, sales rose 4.7%. In women's apparel, a sector that has been struggling, same-store sales at Chico's FAS plunged 22.1%. Earlier this week, Talbot's which also owns J. Jill, reported that it same-store sales fell 6% for the quarter, and that it would close an additional 22 stores. By the end of January, according to TNS Retail Forward's ongoing ShopperScape Survey, half of the value of gift cards received during the holidays has been redeemed, and consumers expect to use two- thirds by Valentine's Day. Some 61% of households received a gift card during the holiday period--up from 56% last year, with an average value of $139.
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