WHAT’S NEW IN DIGITAL AND SOCIAL MEDIA FOR BEAUTY? OVER 200 BEAUTY EXECUTIVES MEET IN NYC TO SHARE AT THE WOMEN’S WEAR DAILY (WWD) DIGITAL BEAUTY FORUM

At Accelerated Analytics, I work with over 20 beauty brands to supply key reports and analysis of how their products are performing at their retail stores. Our expertise, based on years of working with beauty retailers like Dillard’s, Ulta, Sephora and Nordstrom, help account executives, planners and sales reps to track sales to goals, store display marketing, promotional effectiveness and inventory stock levels. I joined the WWD Digital Beauty Forum in New York on Tuesday to hear where the beauty industry is going with digital marketing and social media.

It was an inspiring day! From hearing how the Estee Lauder brand Smashbox is revolutionizing how to use social media influencers to expand their brand awareness, to learning how beauty brands like NYX and Shiseido are using digital technologies to expand social experiences online and in stores to broaden their customers’ experiences was mind blowing. In the ever-important retail need to address the increasing customer desire to have an experience, and not just shop, the beauty industry is using technology in a variety of ways to personalize what they can do for their customers and make their brand fresh, exciting and fun!

Beauty products are personal. Ecommerce efforts to use digital technology to put colors and skin care effects into a virtual customer’s hands live, is amazing. When a customer is in a store, actually touching products, digital technology gives shoppers a hands-on experience to custom-tailor products. Events and contests around pop-up stores is getting more and more common.

What resonated the most with me is, with so much activity and options for shoppers, and the very fast pace of beauty sales, the ability to see what is selling organically and where inventory is at all times is critical. I’m excited that our solution helps my beauty customers, like Coty, L’Oreal, Bvlgari and Parlux, to get the insights they need, when they need it, and gives them the opportunity to expand their digital reach to customers and react quickly when these initiatives take off!

THE OMNICHANNEL HOLIDAY CHALLENGE WITH STORE INVENTORY AND FORECASTING

Holiday shoppers have just a few more days to get their shopping done. Do they order online and get it shipped? Do they order online and then pick up in store? Or do they go into a store hoping to walk out with the items they want to purchase? Retailers have the challenge of meeting all of these needs, many of them using store inventories as distribution centers to handle online purchases, whether shipping it to the customer’s home or having it available so they can pick up the item in the store.

An online customer who is having their products shipped does not care which store or warehouse handles their purchase. A shopper in the store or on the way to a store does – they expect the item to be available on the shelf. Retailers are using different strategies to manage these needs. Some, such as Target, are holding inventories back from online purchasers in order to keep inventory on the shelf for their in-store shoppers. In Target’s example, an online shopper may try to go online and buy or reserve an item in store but are unable to do so. Other retailers, like Toys ‘R Us, have a “first-come, first-served” strategy. The big challenge is for retailers to determine, by product and by store, how to divvy up the store’s stock, and need to forecast in-store purchases to try to have the right amount of inventory on the shelves.

 

Tracking item-store inventories as real time as possible is the best way for these retailers to make these forecasts. Retailers without inventory systems who can keep up with purchases are having to keep extra available in the store and not online, in order to avoid the mistake of selling the same item to two customers around the same time.

Source: Chicago Tribune.com, Wall St. Journal

2016 WAS A GREAT YEAR FOR DIY RETAIL

The holiday season is upon us, and how DIY retail will fare remains to be seen, but 2016 by most accounts has been a great year for DIY retail. The North American Retail Hardware Association (NRHA) is estimating industry growth for 2016 to end at 5.8%. The Home Improvement Research Institute (HIRI) is estimating a little higher, at 6%. The US Census Bureau reports home improvement industry sales through September at 6.7% growth over 2015.

Building materials and home improvement retail sales are 3 to 1 higher than overall retail sales increases for this year.

What has led to the success, and which areas in the DIY space have seen the best results?

Most economists agree that the renewed housing market seen in 2016 will continue into 2017. Add to that higher consumer confidence rates, multi-family housing construction has led to higher sales at home centers and lumber dealers. Remodeling projects and big-ticket purchases are stronger. Big ticket items, such as appliances, have seen the biggest sales uptick in the segment.

Accelerated Analytics DIY customers, using their retailer POS data to analyze sales and inventory, are experiencing the same trends. Across the Accelerated Analytics customer index, June and July showed poor results, followed by an improving August and strong September. 20% of Accelerated Analytics customers’ sales tickets are big ticket items, over $900 per sale. These items were identified as appliances and other expensive items, along with supporting/supplemental products.

The NHRA is predicting 2017 sales to continue this trend and that home improvement product sales should continue to outpace overall retail sales in 2017, anticipating DIY industry growth in the range of 5%.

For more industry stats and observations, download the Accelerated Analytics Retail Industry Briefing Book, which is a monthly publication of key retail industry trends, published to over 7,000 subscribers per month.

Sources: Accelerated Analytics, Hardwareretailing.com

THE HOME DEPOT’S HOMETOWN OF ATLANTA DISCUSSES THE RETAILER’S TECH EDGE

Atlanta news station 11Alive (NBC) sat down Sunday with The Home Depot’s Sr. Director of Digital Strategy & Mobile Applications, Matt Jones, about how the company uses technology to enhance in-store and online customer experiences.

Says Mr. Jones about the retailer’s mobile app, the latest strategy has been to help the customer navigate in the store while shopping. The app also gives consumers the ability to read product ratings and look up detailed product information while looking at products in the aisle, enhancing the shopping experience.

“One of the challenges is being able to visualize how the products will look in your home, “says Mr. Jones. “A door could be an example, a patio set could be an example.”  

When asked how the use of technology has impacted sales, the bottom line and overall efficiencies within the organization, Mr. Jones says the blending of the in-store and digital experiences has definitely been a driver of sales success.

Who is The Home Depot’s tech consumer? “We’ve got a very diverse customer base, from the professional customer…to the customer buying home décor…to the customer doing a DIY project at home.” This year marks the biggest wholesale change to the mobile app in years.

There are a few things Home Depot is focused on for 2017 according to Mr. Jones: giving customers a way to personalize their app and online shopping to focus on their interests. He feels that the faster you can get a consumer to the information they want and will find most valuable is the key to success.

Source: 11Alive.com 

ACCELERATED ANALYTICS CUSTOMER STONER CAR CARE STEPS ON THE GAS

Exciting customer news: Stoner Car Care unveiled their NEW Aston Martin Race Car at AAPEX 2016 earlier this month!       

 

HOME DEPOT SEES BIG GAINS IN 3RD QUARTER GOING INTO HOLIDAY SALES

The Home Depot posted one of the biggest retail jumps post-Halloween among US retailers, seeing online visits increase 17.4% and daily visits to HomeDepot.com over 20 million in the first week of November. The Home Depot is also poised to increase mobile traffic to 53% over the 2015 holiday season.

Online sales increased 17% during the third quarter and US same-store comps grew 5.9%. Significantly, over 40% of online orders placed were items picked up in the store, driving their omnichannel success.

For the first 9 months of the year, sales were $72.39 billion, up 7.2% from last year. The Home Depot attributes the growth to an increase in the number of people who made purchases in its stores and the amount of spend per customer transaction. The company expects its 2016 year to end with increases of 6.3%.

One thing to watch as the holiday season continues – last year Q4 numbers were very high due to prolonged warm weather, up 8.9% over 2014, making it harder for Home Depot to beat same store sales this year.

Sources: Internet Retailer, CNBC

ACCELERATED ANALYTICS LUXURY FRAGRANCE VENDORS POISED TO GROW 5.9% BY 2026

Future Market Insights released a report today that estimates the global perfume market is estimated to reach $39.67 billion by the end of this year, and expects growth of this segment of 5.9% over the next ten years. The firm looked at several Accelerated Analytics beauty and fragrance companies for its report, including Estee Lauder Companies, LVMH, Coty Inc., L’Oreal International, Elizabeth Arden Inc., Shiseido Co. Ltd., Puig and Parlux/Perfumania Holdings Inc.

The reports found that demand is being bolstered by the millennial consumer segment, as well as increased online retail strategies from these companies. Female fragrances are leading the increase, with year-over-year increases from 4-5.2% over 2015 to 2026. While online retailing is the most attractive shopping means to this segment of consumers, in-store remains 80.5% of the market share, due to the personal and olfactory nature of fragrance marketing.

Millennials are drawn to products that have natural ingredients. Fragrance vendors are offering more “Eau Fraiche” (alcohol free) products.

The Western Europe market is the largest consumer, and expected growth consumer, of fragrance products, followed by North America.

To get more retail insights from the Accelerated Analytics team, register for our (free) monthly Retail Industry Briefing Book here.

Source: Luxury Daily

HOLIDAY SHOPPING IS HERE …..ARE CONSUMERS WAITING UNTIL AFTER ELECTION RESULTS?

The National Retail Federation (NRF) conducted a survey last week, and found that more than 25% of shoppers say the election will affect their spending.  43% of consumers also state they are being more cautious with their spending because of election uncertainty.

Retailers are seeing this effect and are making adjustments. Target and Wal-Mart are adjusting their holiday season marketing ahead of November 8.

In addition, retailers are challenged to get their marketing messages out amid all of the election noise. “Everywhere you turn — whether you’re picking up a newspaper or watching television — political advertisements are taking up ad space that retailers typically use to get holiday shopping on the minds of consumers across the country,” NRF President and CEO Matthew Shay said.

Once November 9 rolls around, the NRF predicts the holiday shopping season will kick up. The NRF is still predicting a 3.6% increase in retail spending in November and December, which would make 2016 the most successful holiday shopping season in years. This forecast is in alignment with other predictions from Deloitte, RetailNext and Kantar retail, reports CNBC. This spike is expected regardless of who wins the presidency.

Source: WSJ, NRF, CNBC

HOME DEPOT FOCUSES ON THE ONLINE SHOPPER…BY FOCUSING ON THEIR STORES

The Home Depot has been on the great end of the rebounding housing market with a continued 4% increase in sales in the last quarter, while homeowners work on big remodeling projects like installing decks or remodeling kitchens. Without plans to add more new stores, Home Depot focuses on how to use their existing stores in new ways.

About 42% of Home Depot online shoppers order online, but pick up in the store. To accommodate that, Home Depot is allocating capital to build out store storage to hold those products. When the customer is in the store, the retailer is trying new displays that help the customer shop easier. For example, the spray-paint section is set up like a soft drink display, so as one can is selected, the next can pops into place. In the lumber and millwork flooring area, the displays are easier for the customer to shop off of on their own, and the signage has been improved.

For the increasing online sales where customers want the items shipped to their homes, Home Depot has opened 3 new fulfillment centers that can deliver orders to 90% of their customers within 2 business days. They are also looking into leveraging their store locations to use local economical transportation for buy-online, ship-to-store orders.

Source: Wall St. Journal, IHRC

LOWE’S GOES FUTURISTIC WITH VIRTUAL REALITY HOME IMPROVEMENT FOR CUSTOMERS

Lowe’s has successfully tested the Microsoft HoloLens in its stores in Raleigh and Seattle – so successfully that it plans to expand the technology to three more yet-to-be-disclosed locations.

The HoloLens brings high definition hologram images overlaid to real world surroundings. A customer can use the technology to visualize their home improvements. For example, a customer can go into a Lowe’s store and design their kitchen while sorting through Lowe’s assortment of appliances and material samples. To take it even further, a customer can select an item they saw and liked on Pinterest, and a similar item sold by Lowe’s will appear.

Kyle Nel, executive director of Lowe's Innovation Lab, told USA TODAY in a briefing: "Mixed reality takes some getting used to, because we're all used to pinching to zoom to get closer to things instead of just walking forward. The idea of using small samples and swatches to try and imagine what a room looks like seems very antiquated now."

To try out the HoloLens in the store requires an appointment, especially on the weekends. Lowe’s Innovation Lab is looking for ways to stay ahead of technology, and stay ahead of rival Home Depot.

Source: Investopedia

HALLOWEEN RETAIL SALES SHOULD BE SPOOKY-GOOD!

The National Retail Federation (NRF) annual survey reveals this Halloween should reach an 11-year high in retail spend, to $8.4 billon. US shoppers are expected to spend an average of $82.93, up $8.60 per person compared to 2015.

While candy sales ($2.5 billion) are always attributed to Halloween, retailers should see an uptick in sales of costumes ($3.1 billion), decorations ($2.4 billion) and greeting cards ($390 million). Home improvement retailers, such as Home Depot and Lowe’s, have increased their decorations inventory versus previous years.  Homedepot.com has Halloween at the top of their web page and an entire section of their site dedicated to Halloween. Lowes.com does as well, and storefronts are covered in Halloween lawn and home decorations.

Consumers surveyed plan to spend the most in the first 2 weeks of October (44.4%).

“After a long summer, families are excited to welcome the fall season celebrating Halloween,” NRF President and CEO Matthew Shay said. “Retailers are preparing for the day by offering a wide variety of options in costumes, decorations and candy, while being aggressive with their promotions to capture the most out of this shopping event.”

Sources: NRF, CI News

FALL IS HERE…WILL ECONOMIC FACTORS RISE?

Economic indicators for August dropped, but 2016 overall is still growing.

Home Sales: Existing-home sales dropped .9% in August, marking the second month in a row of decline. However, year-over-year sales are up .8% over last year. While new home sales have been steadily rising, existing-home sales make up 90% of the home sale market. The National Association of Retailers reports that with the housing market in 2016 being the strongest sector of the economy over the past two years, the market may be a “victim of its own success”. Sales early this summer reached the highest levels since 2007, which has led to an increase in prices and a shortage of inventory. The average home price is $240,200, up 5.1% from 2015. The NAR feels an increase in home building would solve the issue. A Commerce Department report this week indicated building permits for single-family homes, the largest segment of the housing market, increased in August.

Manufacturing: The Conference Board reported its leading economic index, weighing 10 different economic indicators, dropped .2% in August. The decline in attributed to the average workweek of production workers and the amount of new orders. However, in the six-month period ending in August, the index increased .9% to an annual rate of 1.8%, which is in line with slow growth reported in gross domestic products. It is forecasted to grow at a 3% pace.

Retail Sales: US retail sales were up 1.9% in August, which was down from 2.4% in July. Retail sales had shown strong gains in the spring but has slowed through the summer months. Sales at department stores fell .6% and general merchandise store sales were flat. Building and garden equipment store sales dropped 1.4%. Retail sales are expected to be on the rise, with Halloween sales expected to boom and the 2016 holiday outlook expected to be positive, especially in e-commerce sales.

Sources: Wall St. Journal, Market Watch

BRING ON THE HOLIDAYS….AND ECOMMERCE SHOPPING

To gear up for what is expected to be a very high e-commerce driven holiday shopping period, UPS says it will hire 95,000 seasonal workers this year, and FedEx Corp will hire close to 150,000. Overall retail hiring is expected to be the same as last year’s high numbers, but a shift to preparing for high online sales with those jobs is clear. Target Corp announced plans to hire 70,000 workers at distribution and fulfillment centers, up 15% from last year.

eMarketer announced survey results that found while moderate growth of 3.3% is expected for holiday retail overall, ecommerce is anticipated to make its biggest jump since 2011, up 17.2%. 71% of shoppers polled said they would make some to all of their gift purchases online. Rubicon Project found similar results in their survey, finding 73% of respondents will shop online, and that 22% of shoppers plan to do all of their holiday shopping online. The report shows that online shoppers will spend 64% on gift cards, 57% on apparel and accessories, 46% on toys and 37% on technology.

Cyber Monday is on track to produce higher results than Black Friday. A shift in the holiday calendar this year is also expected to help retailers. Christmas falls on a Sunday rather than a Friday like last year, giving last minute shoppers an extra Saturday to shop. Hanukkah begins 18 days later than in 2015, which should help generate sales in the latter part of December.

Source: NRF Smartbrief, Chain Store Age, Drug Store News, Fortune

CANADIAN CLOTHING SALES ARE ON THE RISE

The National Retail Federation (NRF) reported today that Canadians are spending more on clothing, footwear and accessories. Statistics Canada released a report that total retail sales in the clothing segment totaled $41.9 billion in 2015, a 38% increase from a decade ago.

During that decade, many retailers exited the Canadian retail market, such as Maxx Canada and Aeropostale. Stores still in the market that primarily sell clothing and accessories made up for 67% of the sales. Retailers of sporting goods, books and music saw their clothing business increase by 50%.

The Statistics Canada report noted that although many retailers closed, most were replaced by higher-end stores. Women’s clothing and accessories totaled $17 billion of the $42 billion, while men’s clothing and accessories were at $9.4 billion. Footwear was right behind at $7.1 billion and luggage and jewelry had $4.4 billion in sales.

Source: NRF Smartbrief, CTV News

WHICH ACCELERATED ANALYTICS CUSTOMER IS ‘POPPING UP’ IN NEW YORK? VERA BRADLEY!

Vera Bradley has plans to open a pop-up shop in NYC, replacing a shop occupied by Kate Spade through the end of last May. Opening in September, the pop-up shop will be 2,700 square feet over 2 stories and will carry the entire Vera Bradley collection. The store will also be the grand debut of Vera Bradley’s redesigned logo and store concept.

The store is geared toward an omni-channel customer experience, with interactive touchscreens allowing customers to participate in the “It’s Good to be a Girl” campaign over social media. Three digital wall displays will display virtual patterns. A kiosk in store will open shopping on VeraBradley.com.

“We are thrilled to open our first Vera Bradley store in New York City," said Robert Wallstrom, CEO, Vera Bradley, Fort Wayne, Ind. "We look forward to showcasing our iconic collections and signature in-store experience to both the local community and tourists.”

Accelerated Analytics has worked with Vera Bradley to provide POS sales and inventory reporting and analysis for their key retailer accounts and independent specialty retailers since 2013. 

Source: Chain Store Age

HOME DEPOT TURNS STORES INTO MINI DISTRIBUTION CENTERS

The Home Depot announced a 6.6% increase in revenue and a 9.3% increase in net profit to $2.4 billion.

The retailer stated that customers are taking advantage of their new options for retrieving their ecommerce orders. In the second quarter, about 42% of Home Depot’s online orders and almost 90% of its online returns were handled by its stores.

Ecommerce sales were just 5.6% of Home Depot’s sales in the second quarter, but were up 19% from a year ago, showing significantly higher growth in sales than in-store. Home Depot is choosing now to invest in infrastructure and order management software to address ecommerce fulfillment from their stores. Online purchases can now be delivered from over 700 stores, faster and with shorter scheduled-delivery windows than possible before.

Source: Wall St. Journal

WILL RETAILER DISCOUNTING HARM BRAND VALUE?

In an effort to get out of this year’s retail doldrums, department store retailers have been reducing prices on fashion brands they typically do not run promotions on. Promotions reached an all-time high in the last quarter, and in July over 2,000 emails advertising specials were sent to shoppers across the US. Some prices in May, June and July were reduced as much as 80%.

Luxury brands most heavily discounted included Michael Kors, Ralph Lauren and Eileen Fisher. Michael Kors is trying to rectify the situation by ending all coupons and friends-and-family sales at department stores. Ralph Lauren is reducing excess inventory. The brands hold the power with the ability to push sales in their own stores and online web sites.

How much are department stores discounting? Saks is leading with an average discount of 60%. Neiman Marcus’s average is around 50% and Bloomingdale’s and Nordstrom are averaging 40% discounts. 

With massive discounting, consumers will expect these luxury brands to be available at the lower price points, bringing down the value of the brand.

Source: Bloomberg Pursuits, Chain Store Age

WILL THIS WEEK BRING AN OLYMPIC RISE TO RETAIL SALES?

Even before the Olympics started, the retail industry has experienced a big spike in athletic apparel. The growing popularity of “athleisure” clothing have helped athletic apparel see an increase this year of 14% to $45.7 billion as of the end of May.

Now the Olympics are in full swing, and the athletes are all decked out in sponsor apparel and logos. Many retailers are selling specifically to the Olympics market. While these retailers may not separate out specific Olympic-driven sales, several are counting on its popularity to drive sales. Athletic apparel in the children’s department is expected to be successful, as younger viewers look up to the athletes. Patriotic colors of red, white and blue are also expected to be popular.

Dick’s Sporting Goods will have specific Olympic displays. Dick’s CEO Edward W. Stack, announced his company’s plan to donate $1,000 for every medal won by Team USA. Macy’s has an exclusive partnership with Ralph Lauren to sell opening and closing ceremony outfits in its stores. Nike, as an official Olympics sponsor, has over 100 Team USA products for sale, and Under Armour has a “country pride” collection.

Retail sales for June will be announced this Friday. May saw an uptick in sales. Retailers are hoping June and July were positive with back to school shopping, followed by buoyed sales in the athletic apparel segment this week. Check back to our blog page to see how the summer retail news is shaping up.

Sources: USA Today, Forbes

BACK TO SCHOOL AND COLLEGE SALES HELP RETAIL SUMMER SLUMP

Back to School sales helped raise retail sales by .3% over the previous week and 2.5% over one year ago, following a four-week decline in June into July. Expectations are that Back to School sales will rise another 2.5% from July through September, which will be a successful repeat of the 2015 season.

Discounters and wholesale clubs were the strongest contributors to the rise in sales last week, with focus on electronics, clothing, shoes and books. Back to School season is highly promotional as retailers clear inventory for the upcoming holiday season. The National Retail Federation expects total spending to reach $75.8 billion, up from $68 billion in 2015. 60.5% of consumers plan to shop in discount stores, followed by 59.6% shopping in department stores. This rising trend over 2015 is significant, as 2015 was a drop from 2014’s splurge year by consumers in the Back to School/Back to College season.

Source: WWD.com, NRF

US BEAUTY MARKET EXPECTED TO GROW TO $90 BILLION IN 2020, AND ACCELERATED ANALYTICS COSMETICS BRANDS ARE IN THE NEWS!

Today’s $80 billion US beauty market will continue to grow according to a report by Euromonitor International. This growth rate will mean the beauty market will grow by 45% in 10 years. In 2015, the premium beauty category grew 7%, with premium foundation sales increasing 14.2%, compared to just 3% the prior year. Consumers have been shifting to premium products, looking for high quality products. Many luxury beauty brands who use Accelerated Analytics POS reporting to optimize inventory levels, track promotions and drive sales are in the news with big headlines this week, such as Parlux Fragrances, Shiseido, Inter Parfums, Estee Lauder, Elizabeth Arden, Coty and L’Oreal. Click Here to learn more about our solutions for beauty brands.