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Monthly Newsletter | September & October 2019
S-CUBE Fixtures for Retail
Table of Contents
Retail's Adapt or Die Moment
Stage Stores Goes All In On Off-Price
Female Shopping Power: 5 Trends Worth Watching
Retail Store Numbers Continue To Grow
 
Retail’s Adapt or Die Moment
To succeed in today’s fast pace retail industry, retailers must expect the unexpected and have the right blend of digital strength, marketplace differentiation, and strategic operations. Whether it’s adapting externally to customers’ unpredictable behavior or internally within a brand’s organization, the time has come for traditional retail marketers to become Adaptive Marketers.

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Browse our entire library of industry topics.

 
 
Stage Stores Goes All In On Off-Price
Stage Stores Inc. will close about 40 stores as part of a plan to substantially convert to its off-price Gordmans banner.

Stage plans to begin converting its remaining department stores in February 2020, and expects to be operating approximately 700 predominantly small-market Gordmans off-price stores by the third quarter of fiscal 2020. A limited number of stores may continue to operate under their existing department store nameplates until closure is permitted by lease.

As part of the conversion, the company plans to close approximately 40 stores during fiscal 2020. Capital spend in fiscal 2020, inclusive of all conversion activities, is expected to be approximately $30 million.

“We are excited about our future as we fully transition to an off-price business model,” said Michael Glazer, CEO, Stage Stores Inc. “Since 2018, we have converted 98 department stores to off-price, including 17 small-market conversions which are grand opening today in Michigan, Pennsylvania, Ohio, Kentucky, and Tennessee. Compared to their performance as a department store, off-price conversions have consistently delivered higher sales with less inventory, similar retail margins, and lower SG&A. Additionally, with the success of our recent tests of lower cost conversions, we are able to execute our fiscal 2020 conversion strategy while maintaining our capital spend in line with fiscal years 2018 and 2019.”
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As of September 17, 2019, Stage Stores operates in 42 states through 625 Bealls, Goody’s, Palais Royal, Peebles, and Stage specialty department stores and 158 Gordmans off-price stores, as well as an e-commerce website.

Stage Stores acquired 48 stores and a distribution center from Gordmans in March 2017 after Gordmans filed for bankruptcy and decided to liquidate. It turned the acquired chain into an off-pricer to successful results — so successful that Stage Stores has been converting its own stores to the off-price banner.

Source: Chainstoreage.com
 
 
Female Shopping Power: 5 Trends Worth Watching
Vintage Vibes:
Instant film, buyers of which are nearly two-thirds female and skew young, is a growing category in consumer tech. Sales of instant film (similar to the Polaroid products of the 1970’s) increased 8% year-over-year in the 12 months ending July 2019, shown by our Retail Tracking Service. Outside of the holiday season, June is the top dollar-grossing month for the category as young consumers capture their milestones, like graduation season and prom, in a unique and tangible way. 
Backpacks:
Backpacks are fast becoming the new prominent work bag among women, explained Accessories and Footwear Industry Analyst Beth Goldstein. Compared to traditional totebags, weight is more evenly balanced by backpacks, making them more comfortable to carry to and from meetings and while commuting. While handbags and totes declined in the 12 months ending in July compared to previous 12 months, our Retail Tracking Service shows fashion backpacks and lifestyle backpacks grew 13% and 7%, respectively.

Ingredients:
Women are increasingly turning to online research to better understand the ingredients in – and the brands behind – their facial skincare products. Our recent Women’s Facial Skincare Consumer Report notes nearly 50% of women surveyed prefer to research skincare products online prior to buying them in-store, citing online reviews and ratings and social media influencers as their sources of information. As product information becomes more accessible, female consumers are using their spending power to ensure their voices are heard; they’re supporting brands that offer natural ingredients and transparency. In fact, 46% of facial skincare users report purchasing products free of sulfates, phthalates and/or gluten, representing a 6 point uptick over the past two years. 
 
Girls are Gamers:
With the rise of e-sports and video game streaming services, gaming is fast becoming one of the hottest opportunity areas for brands to engage with Gen Z. Our data shows 9.3 million U.S. girls aged 13 – 17 play video games, compared to 11.4 million boys. Among gamers, girls are more likely than boys to play mobile games (95% for girls vs. 90% for boys), and they are less likely than boys to play on consoles and PCs. The top games among girls aged 13 – 17, are Minecraft, Candy Crush Saga, and Pokémon Go. 
 
Older, wiser, more Active:
Gen X shoppers are the fastest-growing segment in the women’s active apparel market, our Consumer Tracking Service reports. This group accounted for 25% of women’s active sales in the 12 months ending July 2019, up from 22% the previous year. This presents an opportunity for brands and retailers to target premium active products to Gen X consumers who, on average, have a higher income than Millennials and Gen Z—two groups that historically have dominated the category. Additionally, women are wearing activewear as fashion staples beyond exercise, opening the door for more products that are comfortable yet fashionable. It’s worth nothing that while women are major players in active apparel, representing 43% of dollar sales, there is still room for growth; they account for an even larger portion of non-active sales (nearly 60%).
 
Source: NPD.com

 
 
Retail Store Numbers Continue To Grow
For every retailer closing stores, five retailers are opening stores
 
With the bankruptcy of Barney’s in the news, we’re bound to see another round of handwringing in the media over the “retail apocalypse.” The actual data paints a very different picture, though. As the just-released “Retail’s Renaissance —True Story of Store Openings/Closings” report from IHL Group points out, retail stores are definitely not going away. According to the report, for each company closing stores, 5.2 are opening stores. For every segment of retail, there are more companies opening stores than closing stores. Even the much-maligned department store category has more brands opening stores than closing them.
The reality is that the wave of store closures seen in recent times is being driven by a handful of companies. Just 16 retailers are responsible for 73 percent of retail store closings so far this year, according to IHL. Retail is a dynamic, fast-changing, highly competitive industry and there are no guarantees of success. Consumer expectations are growing and evolving, and retailers must invest heavily to improve the in-store experience.

In the most recent edition of NRF’s Consumer View report, two-thirds of consumers said technologies such as augmented and virtual reality, smart dressing rooms and in-store navigation apps have improved their in-store experiences. At the point of sale, technologies such as self-checkout, curbside pickup and mobile payment have made checking out an easier and more satisfying experience. The cost of implementing these technologies has been high but it appears to be paying off. If anything, stores remain an integral and growing part of the retail landscape.

According to Census Bureau data, 2018 saw a net increase in retail stores in the United States. There were almost 3,100 more stores during the fourth quarter of 2018 than the same quarter a year earlier. What’s interesting is that the increase appeared to be driven by smaller stores: Stores with fewer than five employees were the big gainer, with a net increase of 4,569 as of the first quarter of 2018 compared with the same time in 2017.

With so many billion-dollar brands that shape our retail consciousness, it’s easy to forget that retail is an industry dominated by small business: 98 percent of retail is made up of small businesses. This segment’s vibrance is encouraging because it represents the future of our industry. There might well be a small business opening its first store today that will become a dominant player in the next decade. The retail landscape 10 years from now will likely be one where stores still play a vital role in the shopping experience.

Source: NRF.com

 
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