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FROM THE DESK OF DEBORAH WEINSWIG
Surge in Demand for Outdoor Activities Opens the Door to New Store Categories Lockdowns spurred many consumers to seek out ways to keep themselves entertained and healthy, both at home and outdoors. Retailers in these categories are capitalizing on this trend by offering new and innovative store experiences, following a surge in sales of exercise equipment and outdoor sporting goods, As shown in Figure 1, sales growth of sporting goods initially underperformed total retail sales at the height of the pandemic in March and April 2020, but began to outperform in May 2020, with this trend continuing through January 2021. Figure 1. US: Sporting-Goods Store Sales Versus Total Retail Sales, Year over Year Growth [caption id="attachment_125645" align="aligncenter" width="720"]
Note: February 2021 sporting-goods sales data are not yet availableSource: US Census Bureau/Coresight Research[/caption] Sporting-goods retailers are seeing different patterns of demand, with products related to outdoor activities, including cycling, hiking, golf and fly fishing, in particular, proving immensely popular as consumers seek a change of scene from extensive periods spent locked down. In an event hosted by Coresight Research and Blue Yonder with retailers in February this year, outdoor and sporting goods retailer Orvis reported on an increase in consumers seeking to reconnect with the outdoors, which resulted in an unprecedented spike in demand for fly-fishing equipment at its stores. To take advantage of this demand, Orvis offered free fly-fishing lessons for beginners in stores and offered in-store discounts to participants on purchases of related tools and kits. DICK’s Sporting Goods is innovating its in-store experiences with new concept store launches to profit from the surge in demand. The retailer debuted its “DICK’s House of Sport,” concept store earlier this week, opening the store outside Rochester, New York, on April 9. The new store features an outdoor turf field and running track spanning 17,000 square feet, as well as a batting cage, golf driving bays and a putting green. The store also houses the retailer’s new wellness concept “House of Cleats,” which offers items from rotating product categories. Moreover, DICK’s has announced the relaunch of its revamped Golf Galaxy stores and is set to open more than 30 dedicated Soccer Shops in the coming months. As we continue to experience wonderful spring weather in the US Northeast, many consumers’ thoughts will be turning to the prospect of spending more time outdoors and continuing strong retail sales indicate that consumers still have the wherewithal to spend. We expect shoppers to continue to devote much of their disposable income to products for embracing the great outdoors this spring and summer.
US RETAIL AND TECH HEADLINES
Albertsons Companies Streamlines Point-of-Sale Software Testing with Artificial Intelligence (April 6) ChainStoreAge.com- Grocer Albertsons Companies has switched to artificial intelligence (AI)-driven testing of its point-of-sale (POS) and peripheral systems following a review of its technology infrastructure.
- The company reported that automation has reduced its software testing time from almost two weeks to a couple of days and also freed up employees to focus on exploratory and evaluation testing, instead of repetitive manual test execution.
- Kohl’s has announced the opening of its sixth e-commerce fulfillment center, based in Etna, Ohio, to meet continued digital demand and online sales acceleration at the company. The center spans 1.2 million square feet, making it the largest Kohl’s fulfillment center, designed to improve its efficiency via automation and advanced technology.
- Kohl’s stated that the new e-commerce fulfillment center supports the company’s initiatives and strategic framework, which focus on driving topline growth while expanding operating margins through reduced fulfillment costs, in-store online order pickup and end-to-end supply chain optimization.
- Nordstrom has expanded its recycling program to Canada, becoming the first major retailer in the country to accept customer returns of hard-to-recycle beauty packaging from all brands. The department store first launched its BEAUTYCYCLE program in the US in October 2020.
- Through the program, Nordstrom aims to collect 100 tons of hard-to-recycle beauty packaging by 2025. In addition to BEAUTYCYCLE, Nordstrom’s 2025 environment goals include ensuring 15% of its product assortment is sustainable, donating $1 million to support textile recycling innovation and using sustainably sourced raw materials in 50% of Nordstrom Made cotton and polyester products.
- Target has announced that it will spend over $2 billion at Black-owned businesses by 2025 as part of the company’s effort to advance racial equity.
- The retailer has pledged to incorporate products from more than 500 Black-owned companies across into a variety of its categories and increase its spend with Black-owned companies, including marketing agencies and construction and facilities maintenance companies. The announcement builds on Target’s commitment in September 2020 to increasing the representation of Black team members across the company by 20% over the next three years.
- Tractor Supply has updated its Neighbor’s Club loyalty program in response to customer feedback. The enhanced offering enables customers at all membership levels to earn points for each dollar spent in Tractor Supply Stores, with points accruing more quickly as loyalty members climb the membership tiers.
- Neighbor’s Club currently has more than 20 million members. Tractor Supply expects the program revamp to attract new customers and better engage existing members, as well as improve its overall customer shopping experience.
EUROPE RETAIL AND TECH HEADLINES
Carrefour Partners with Deliveroo, Launches Express Grocery Delivery Service in France (April 7) EsmMagazine.com- Carrefour has partnered with Deliveroo in France to offer an express delivery service, with groceries dropped at consumers’ doors in under 30 minutes. After the successful launch of Carrefour stores on the Deliveroo platform in Belgium, Italy and Spain, the service will launch in Paris this week.
- The partnership aims to develop Carrefour’s e-commerce services and raise the retailer’s profile in local markets. The express home-delivery service is set to be rolled out in a further 10 French cities in the next few months.
- E-commerce platform Farfetch is set to open a digitalized luxury boutique in London on April 12. The flagship Browns store will open in Mayfair, following the acquisition of the luxury fashion brand by Farfetch in 2015.
- The store will leverage technology to enhance shopping experiences, with digital personal shopping wish lists and virtual try-on functions enabled by artificial reality (AR) for products that aren’t available in the store. Resembling a department store, the flagship spans four floors and includes an outdoor area, restaurant and exhibition space.
- As part of its Innovation Stories concept launch, H&M has released a new sustainability-themed collection named Science Story, available in selected stores and at hm.com.
- The collection is described by the company as paying tribute to the fabrics of the future. It introduces new materials, such as “EVO,” a yarn derived from castor oil, and “Desserto,” a plant-based alternative to leather made from cactus leaves. Key pieces from the collection include shirts, trousers and tracksuits.
- British fashion brand Joules has hired Caroline York as its new Chief Financial Officer, effective from September 2021.
- York is currently the Finance Director for MoneySuperMarket and has previously held leadership positions at Heathrow Airport, KPMG and PwC.
- British retailer Poundland is set to open 25 to 30 Poundland and Dealz stores in the UK and Republic of Ireland. The retailer expects its move to create 250 jobs by September.
- The retailer has also confirmed the reopening of 55 of its “hibernating” stores in England and Wales in its effort to create new jobs and support the UK’s recovery amid the pandemic.
ASIA RETAIL AND TECH HEADLINES
CU Opens First Outlet in Malaysia (April 7) InsideRetail.asia- South Korean convenience store chain CU has opened its first store in Kuala Lumpur, Malaysia, in line with its aim of expanding into foreign markets. Malaysia is the chain’s second overseas market, following on from the chain’s expansion into Mongolia in August 2018.
- CU plans to open 50 new stores in Malaysia within one year, and aims to become the market leader in the medium to long term by opening more than 500 stores across Malaysia in the coming years.
- Indian e-commerce marketplace Flipkart has teamed up with logistics provider Mahindra Logistics to expedite the deployment of electric vehicles (EVs) across its logistics fleet in the country.
- The partnership follows Flipkart’s announcement in February 2021 of its commitment to making its logistics mobility fleet 100% electrics with the deployment of more than 25,000 electric vehicles by 2030.
- Chinese e-commerce enterprise resource planning (ERP) system developer Jushuitan has announced its $15 million-dollar investment in software-as-a-service (SaaS) service provider Ecool, which has supports more than 210,000 clients, predominantly in the fashion sector.
- Ecool serves apparel wholesalers and retailers that have stores outside of major cities. It first launched its SaaS application in 2012, which is designed to enable small apparel businesses and wholesalers to automatically record operational data and manage key business information.
- Indian online pharmacy startup PharmEasy’s parent firm API Holdings has raised $350 million in a funding round led by investment firms Prosus Ventures and TPG Capital. The deal has reportedly raised the valuation of PharmEasy to $1.5 billion.
- The company stated it plans to utilize the funds to expand its reach to 120,000 pharmacies in the next 12 months and broaden its operations subsequently to over 200,000 pharmacies in the next two years.
- South Korean conglomerate SK Group has bought a 16.26% stake in Vietnamese omnichannel retail chain VinCommerce for a total cash consideration of $410 million. This deal has raised the valuation of the South Korean retailer to $2.5 billion.
- VinCommerce operates around 2,300 convenience stores and supermarkets across Vietnam and is owned by Vietnam-based private conglomerate Masan Group. The company plans to use the proceeds from this transaction to bolster its balance sheet and fund future growth initiatives.