Today in retail, Amazon preps Prime Day, while retailers worry about a weak economic environment for discretionary and “big ticket” purchases. Plus, Tommy Hilfiger partners with My Wardrobe HQ on a reCommerce collection and Chewy’s act of kindness gives the pet supply company positive PR it couldn’t buy at any price.
‘Big Ticket’ Retailers Look to Home Equity as Sales Savior
A pre-summer heat wave is expected to offer a brief blip in sales, but once temperatures return to normal, the pre-existing retail climate will return with it, along with inventory issues, declining sales and increasingly stressed consumers.
The problem, however, is that unlike the weather, the double crunch hit of high inflation and rising borrowing costs that is currently crushing consumers won’t be gone in a few days, or probably even a few quarters.
With the Federal Reserve signing off on the sharpest single-day increase in its benchmark rate in 28 years Wednesday (June 15), the back end of the inflation-interest rate equation is set to get even worse, and further darken an already weak retail sales environment — especially for discretionary and “big ticket” items.
Few retailers have more exposure to housing and mortgage rates than Home Depot, which told investors last month that virtually all of its sales to professional customers were on behalf of homeowners, and that over 90% of its DIY customers were also homeowners.
Target Launches Line of Ready-to-Drink Tipples to Lure Cocktail Crowd
Target has launched private-label Casa Cantina ready-to-drink (RTD) cocktails, noting their availability in stores and via the retailer’s same-day eCommerce channels, the retailer announced Tuesday (June 14). The company has been leveraging its beer, wine and spirits offerings to boost digital sales.
In May 2021, Target announced that these items were being offered for curbside or in-store pickup at more than 1,200 stores across the US and for same-day delivery via Shipt at more than 600 retail locations. Additionally, the retailer said there was a 450% surge in digital orders in the adult beverage category in 2020.
On a call with analysts last month, discussing the retailer’s first quarter 2022 earnings results, Target Executive Vice President and Chief Financial Officer Michael Fiddelke noted the shift away from national brands, highlighting the “strength of the own brands in food and beverage.”
Tommy Hilfiger, My Wardrobe HQ Debut reCommerce Collection
Global fashion brand Tommy Hilfiger is teaming up with British rental service My Wardrobe HQ (MWHQ) to jump into the reCommerce game with a new website at a time when it’s mired in all sorts of volatility, a company representative confirmed to PYMNTS Thursday (June 16 ).
The companies will launch their partnership with a six-month pilot offering, according to a Yahoo report, with a collection that includes past and current selections in womenswear, footwear and accessories for rent at resale prices.
Arizona Muse, Poppy and Chloe Delevingne and Prime Minister Boris Johnson’s wife Carrie Johnson are among MWHQ’s high-profile customers. Tommy Hilfiger chose the MWHQ partnership after a six-month pitch process, a report said.
Revlon Bankruptcy Filing Shows Beauty Brands’ Challenges in Connected Economy
Revlon has filed for Chapter 11 bankruptcy, and while the company’s not going out of business, there are several lessons for old-guard companies navigating post-pandemic commerce.
That’s especially true for the beauty brands, which have traditionally relied on in-person, tactile experiences at the counter. The business models are being tested — and pressured.
Revlon’s filing may not surprise anyone, as sales dipped by more than 20% in 2020 to $1.9 billion — everyone worked from home, stores were shuttered, there really was no need for us all to look our best. Sales have yet to touch pre-pandemic levels, coming in last year at about $2.1 billion. And so, Revlon has gone to the courts to seek protection and to restructure.
Chewy’s Act of Kindness Goes Viral and Serves as a Lesson in Loyalty
A random act of kindness has earned online pet supply retailer Chewy millions in positive PR while standing as a stark reminder of the importance of treating customers you never see with gratitude and respect.
In a now-viral Tweet, Chewy customer Anna Brose from Alaska wrote: “I contacted @Chewy last week to see if I could return an unopened bag of my dog’s food after he died. They 1) gave me a full refund, 2) told me to donate the food to the shelter, and 3) had flowers delivered today with the gift note signed by the person I talked to?? “
That publicly posted thank you note had been shared almost 35,000 times and liked by another 571,000 users through 2 pm ET Thursday (June 16), creating a literal tsunami of positive publicity that no brand could buy at any price.
Amazon Prime Day Will Face Aggressive Rivals, Numb Consumers
With Amazon announcing the latest iteration of its annual Prime Day event, it won’t be long before rival retailers unveil their own sales and promotional events, at a time when the industry is bulging with inventory and in need of a bump.
The question, however, is how — and if — consumers will react when they realize that a two-day event that is officially slated to run July 12 and 13 is actually kicking off this weekend.
Furthermore, changing consumer behavior will also be a major factor in this year’s swirl of mid-summer sales, as PYMNTS research has already shown belt-tightening and “paycheck-to-paycheck” budgetary constraints are now impacting households earnings up to $250,000 per year .