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Walmart Makes a Play for U.S. Sports Fanatics

The Motley Fool – Walmart (NYSE:WMT) has lagged behind Amazon (NASDAQ:AMZN) when it comes to licensed sports apparel and being able to offer certain prestigious brands in that space. But that’s no longer the case, as the retail giant has partnered with Fanatics to launch a specialty store selling licensed sports apparel on Walmart.com. As part of the deal, Fanatics will be the exclusive provider of officially licensed sports merchandise on Walmart.com moving forward.

Fanatics operates NFLShop.com, NBAStore.com, and MLBShop.com. It makes its own merchandise and sells a number of brands that Walmart previously did not have access to. This includes Nike (NYSE:NKE), New Era, Mitchell & Ness, and others.

Nike has sold select merchandise on Amazon.com since 2017. It has worked with Walmart’s Jet.com since October.

This deal fills a major hole for Walmart while greatly increasing distribution for Fanatics. It takes merchandise that consumers want and makes it easier for them to get it. That’s more important in a challenging retail climate where chains like Dick’s Sporting Goods (NYSE:DKS) lose a top rival in Sports Authority (back in 2016) and don’t show significant growth despite the reduced competition.

“The Fanatics partnership with Walmart will certainly benefit both companies,” Ken Morris, principal at BRP, retail consulting firm. “For Walmart, it increases the traffic on and brand image of the Walmart.com marketplace. As Walmart adds more leading brands to the marketplace, more consumers will think of it as a first place to do product searches, which Amazon currently dominates.”

Read Full Article: Walmart Makes a Play for U.S. Sports Fanatics

Naadam’s pop-up twist: It only sells one type of sweater

Glossy – The front window of cashmere sweater brand Naadam’s SoHo store is emblazoned with a giant “75,” advertising the brand’s $75 cashmere sweater. But the store is not just highlighting the $75 sweater; it is literally the only thing available to purchase in the store. Founder Matt Scanlan opened the store dedicated to the single product as a reaction to the sometimes overwhelming number of choices consumers face.

“It’s a much simpler proposition,” said Scanlan. “Some people want fewer choices. They don’t want to be bombarded with options. The fewer SKUs we offer, the faster and simpler it is for them. We can also grow the company faster because we don’t need to analyze data across a bunch of variables. It’s one sweater in a handful of colors, so it’s easier to optimize.”

Scanlan said the simplified store, plus the fact that it offers sweaters customized with embroidery and monograms on site, has led to a significant conversion rate, particularly compared to the brand’s online store. Naadam’s online store typically sees hundreds of thousands of visitors per month. Despite that, conversion rates are low, around 1 or 2 percent, according to Scanlan. Conversely, the single-product store sees far fewer people actually visiting — a few hundred per day — yet conversion rates are much higher. “We’ve sold close to 100,000 sweaters [in-store] since the store opened in November,” he said.

“Uber-focused brands, selling only one product category, have become a hot trend in retail,” said David Naumann, vp of marketing at BRP, retail consulting firm. “If you can differentiate your product in a way that’s compelling, it can drive enough demand for a profitable retail business. This has been the case for successful subscription services for products like razor blades, socks and ties.”

Read Full Article: Naadam’s pop-up twist: It only sells one type of sweater

Macy’s closing should be a call to action

Daily Mail WV – The news was sad, but hardly surprising. Macy’s will close its Charleston store in a few months, after a clearance sale. I shopped there over the holidays and came away thinking its days were surely numbered, that it wouldn’t survive the next round of downsizing. Merchandise selection was poor, and clerks were few and far between. Likewise, customers.

An article on a website called Retail Touchpoints says malls that will survive in coming years — and it predicts many will not — must let go of the anchor concept.

“Mall operators have plenty of options to replace anchor department stores and apparel retailers, adding space for events and pop-up stores, grocery stores, smaller format stores and even coworking spaces. These locations can be much smaller than the large anchors that occupied the spaces for decades.”

Ken Morris of Boston Retail Partners mentioned an Apple Store as offering “something for everyone, regardless of if you’re six or seven years old, or 70 years old. It’s an event. It’s theater, and the reality is that’s going to draw people all of the time.”

Read Full Article: Macy’s closing should be a call to action

How Hudson’s Bay Company looks to pay off its debt and revitalize its stores

Glossy – Once, Lord & Taylor’s Fifth Avenue flagship store was a jewel in the crown of Hudson’s Bay Company, its parent company. In 2010, HBC invested $150 million in updating the store. Seven years later, Lord & Taylor received another $12 million renovation. Yet within just over a year of that final investment, the company sold the building, the oldest department store in the country, to WeWork, closing its doors for good on Thursday.

So how did the company go from pouring more than $100 million into the store to selling it in just a few years? In short, it is likely because of the same challenge that legacy retailers across the board are facing: strong competition from disruptive new forces.

“With intense competition from online retailers, maintaining a profitable brick-and-mortar presence in the high-priced real-estate shopping district on Fifth Avenue is extremely challenging,” said David Naumann, vp of marketing at BRP, retail consulting firm. “While a presence on Fifth Avenue helps elevate the brand image for Lord & Taylor, brand image doesn’t translate into profitability. As a corporation driven by stockholders’ desire for stock price appreciation, Hudson’s Bay Company sold its Lord & Taylor property to boost its profitability.”

Read Full Article: How Hudson’s Bay Company looks to pay off its debt and revitalize its stores

Elevated Customer Expectations Require Integrated Planning Processes and Systems, According to BRP Report

54% of Retailers are Focused on Better Integration of Customer Data into Planning Activities

Boston, MA – December 13, 2018 – As customer shopping journeys continue to span across channels, it is imperative for retail planning processes, systems and organizations to be streamlined and integrated to meet increased customer expectations. Current disparate solutions must be transformed into one cohesive environment with the ability to offer customers a seamless shopping environment and the capability to deliver the right merchandise immediately – wherever it is needed. BRP published the 2018 Integrated Planning and Inventory Management Survey to offer insights on the key challenges and benefits of integrating planning processes and systems and identify where retailers are on this path to providing a holistic shopping experience.

“Today’s customer journey requires retailers to use an integrated set of solutions, processes and organization to create and deliver the shopping experience consumers expect,” said Gene Bornac, senior vice president and practice lead, BRP. “The good news is that many retailers realize their systems and processes need improvement and are planning to replace more than 50% of their planning systems within the next three years. Retailers are also focused on improving the integration of actionable customer data into their planning activities, as customer demand is a critical variable in today’s customer-led demand planning.”

To achieve an integrated retail planning model, retailers need to:

Align the organization

  • 40% of retailer currently have an integrated planning organization across channels and 73% of those indicate it needs improvement
  • Within three years, 87% of retailers plan to have an integrated planning organization across channels

Integrate planning processes

  • 43% of retailer currently have an integrated planning business processes across channels and 84% of those indicate it needs improvement
  • Within three years, 93% of retailers plan to have integrated planning business processes across channels

Implement technology

  • 39% of retailer currently have an integrated planning systems across channels and 82% of those indicate it needs improvement
  • Within three years, 89% of retailers will have integrated planning systems across channels

Prioritize customer data

  • 54% of retailers are focused on better integration of actionable customer data into their planning activities
  • 44% of retailers utilize customer feedback in real-time to impact in-season planning

To download the 2018 Integrated Planning and Inventory Management Survey, visit:

https://brpconsulting.com/download/2018-integrated-planning-survey

About BRP

BRP is an innovative retail management consulting firm dedicated to providing superior service and enduring value to our clients. BRP combines its consultants’ deep retail business knowledge and cross-functional capabilities to deliver superior design and implementation of strategy, technology, and process solutions. The firm’s unique combination of industry focus, knowledge-based approach, and rapid, end-to-end solution deployment helps clients to achieve their business potential. BRP’s consulting services include:

Strategy | Business Intelligence | Business Process Optimization | Point of Sale (POS)

Mobile POS | Payment Security | E-Commerce | Store Systems and Operations | CRM

Unified Commerce | Customer Experience | Order Management | Networks

Merchandise Management | Supply Chain | Private Equity

For more information on BRP, visit http://www.brpconsulting.com.

Integrated Planning Solutions are Imperative to Retail Success, According to BRP Report

The BRP SPECIAL REPORT: Integrated Planning – Getting it Right, Identifies Key Challenges and Benefits of Integrated Planning Processes

Boston, MA – December 6, 2018– Streamlined and integrated planning processes are foundational to developing sound strategies and plans that align with consumers’ expectation of a seamless, cross-channel shopping journey. BRP published the SPECIAL REPORT: Integrated Planning – Getting it Right, based on the 2017 Merchandise Planning Survey, to offer insights into the key challenges and benefits of integrating planning processes and systems.

“While some retailers have been able to work with legacy tools and disjointed processes, their results have been hindered by siloed data. In order to keep up, retailers must evaluate their processes and technology, automate tactical activities, and focus on how they can position their organization for success,” said Gene Bornac, senior vice president and practice lead, BRP. “With the knowledge that they have the right data integrated across the process, it will improve retailers’ ability to focus on finding the right products and distributing them to the right places. Integrated planning processes and technology are key to this effort by providing a single source of truth, collaborative approach, and organizational alignment.”

Retailers are gathering more data, across multiple channels and customer touchpoints, that is being leveraged by financial plans, demand plans, assortment plans, and store plans. The importance of a fully integrated planning solution to analyze and utilize this data is key to ensuring retailers remain competitive in this rapidly changing landscape. An integrated planning solution eliminates silos, leverages the same data, streamlines decisions, and builds consensus.

Integrating planning process is important, but also challenging.  This special report acknowledges the obstacles involved to eliminate silos and integrate people, processes and technology: resource constraints, disparate systems, organizational/process challenges, and budget constraints.

To download the BRP SPECIAL REPORT: Integrated Planning – Getting it Right visit:

https://brpconsulting.com/download/2018-special-report-planning

The BRP SPECIAL REPORT: Getting it Right: The Science of Planningplatinum sponsor is Aptosand the gold sponsors are enVista, Mi9, Logility, NCR, and Retalon.

About BRP

BRP is an innovative retail consulting firm dedicated to providing superior service and enduring value to our clients. BRP combines its consultants’ deep retail business knowledge and cross-functional capabilities to deliver superior design and implementation of strategy, technology, and process solutions. The firm’s unique combination of industry focus, knowledge-based approach, and rapid, end-to-end solution deployment helps clients to achieve their business potential. BRP’s consulting services include:

Strategy | Business Intelligence | Business Process Optimization | Point of Sale (POS)
Mobile POS | Payment Security | E-Commerce | Store Systems and Operations | CRM
Unified Commerce | Customer Experience | Order Management | Networks
Merchandise Management | Supply Chain | Private Equity

For more information on BRP, visit http://www.brpconsulting.com.

Retailers plan for blockbuster holiday season despite tariff overhang

Washington Examiner – Retailers are stocking their shelves to meet blockbuster holiday-shopping demand fueled by U.S. economic growth while preparing for slower sales next year as President Trump’s escalating tariffs drive up prices. The time from Halloween through Christmas is typically the most lucrative period of the year for companies from Macy’s to Pottery Barn and Target, and the retail industry is beginning to flourish after a long stretch of declining revenue as Amazon siphoned off customers.

Underpinning their growth is near-record U.S. consumer sentiment and unemployment close to a 50-year low. Wages are also starting to rise more rapidly, and last year’s GOP-led tax cuts let most Americans keep more of what they earn.

“We’re talking about a $1 trillion holiday season coming up,” Ken Morris, principal at Boston Retail Partners, retail consulting firm, told the Washington Examiner. “A lot of these guys do half their business in a two-month period. They’re losing money most of the year until they hit the fourth quarter.”

Read Full Article: Retailers plan for blockbuster holiday season despite tariff overhang

Why catalogs still have a hold on holiday marketing

Retail Dive – Many retailers have turned into fourth-quarter catalogers to cash in on the season’s sentimentality, while shoppers are crossing “irrelevant email marketing” off their lists this year.

Catalogs might be aimed at inspiration, but the hope is that the visual inspiration leads to a purchase, whether it be through the catalog, online or through a visit to the store. In that way, catalogs aren’t too different from the showroom format that retailers like Bonobos rely on, according to Ken Morris, a principal at Boston Retail Partners. It’s a trend he calls “catalog rooming” — where a customer uses a retailer’s holiday catalog to discover products and then heads into the store to see it in person and try it on, either finishing the purchase there or coming home to buy it online. 

It’s also a way to bring customers who might not have shopped in a while back into the fold, as retailers generally send out their holiday catalogs to a broader array of shoppers than they do the rest of the year. As long as they’re making $0.20 on every dollar they spend on a customer, the catalog will keep coming, Morris says — and the holidays provide more potential than the rest of the year for a big profit.

“Some of them, they’re in the red for nine months of the year and then the final three months of the year they go into the black and start to make a profit and hopefully that covers the loss,” Morris said, noting that depending on how sophisticated the retailer is, catalogs might also be tailored, placing a customer in one of a certain number of categories with different material in each. “It’s to the demographic that I fit into because they know what I buy — they know what’s in my closet, they know what’s in your closet.”

Read Full Article: Why catalogs still have a hold on holiday marketing

Selfridges ramps up menswear offerings with streetwear destination

Luxury Daily – British department store chain Selfridges is looking to attract both male and female shoppers with a menswear space devoted to high-end streetwear, leaning in to luxury fashion’s increasingly gender neutral, casual aesthetic.

Dubbed the “Designer Street Room,” the retail concept has found a home in the menswear department and was developed with brand mixing and cross-category shopping in mind, including luxury labels such as Gucci and Versace. Selfridges’ latest opening reflects consumers’ high-low shopping patterns, as they curate wardrobes that blend a bevy of brands.

“Selfridges understands that the shopping experience for designer streetwear is different than their typical Selfridges’ customer shopping experience,” said David Naumann, vice president of marketing at BRP, retail consulting firm. “The target audience for streetwear enjoys an immersive and social experience – they appreciate the theater of shopping.” Mr. Naumann is not affiliated with Selfridges, but agreed to comment as an industry expert.

“Skateboarding is a common sport for streetwear consumers and creating a full-blown skate park within the Street Room is a clever way to capitalize on consumers passion for the sport,” Mr. Naumann said. “With other unique things to see and experience, such as the classic green and yellow Range Rover in the middle of the room, shoppers can continue to be entertained and surprised.”

“Selfridges’ customer base has a higher skew of older and more affluent consumers,” BRP’s Mr. Naumann said. “Streetwear is moving upscale into luxury brands and the Street Room concept is a great opportunity to attract younger audiences to Selfridges.”

Read Full Report: Selfridges ramps up menswear offerings with streetwear destination

What’s on the Menu?

Frozen and Refrigerated Buyer – Industry observers say consumers’ appetite for frozen foods will only grow in 2019. Key ingredients include e-commerce, premium private label, meal kits, small formats and targeted promotions.

2018 is shaping up to be a banner year for the frozen department. During the 52 weeks ended Aug. 12, reports Chicago-based market research firm IRI (iriworldwide.com), sales of frozen foods shot up 2.8% to more than $54.95 billion across channels, while volume rose 2.2%, as consumers gravitated to a slew of new offerings in categories like meals, pizza and veggies that better meet their needs.

Comments from Ken Morris:

Page 43-44:
Ken Morris, principal at BRP, retail consulting firm, tends to agree, calling Walmart “a much bigger threat” to traditional grocers because its stores can act as distribution centers for 90% of Americans who live within 10 miles of one. In addition, “Walmart continues to make it easier for busy consumers to buy online and pick up at the store or at free-standing kiosks or have items delivered to their homes. As these options become accepted and expected, most grocers are going to have to offer these same services to protect their sales — even for frozen and refrigerated items.”

Page 46:
“Consumers continue to spend more of their food dollars at restaurants,” explains Morris. “As more restaurants offer convenient pick-up and delivery options, they’ll pose an additional threat to retailers.” And then there are restaurants like Chick-fil-A that are dipping their toes into the meal kits business as well. In response, says Morris, grocers will likely need to add more prepared food options and continue to blur the lines between super- markets and restaurants.

Page 48:
Morris adds increased supply chain efficiency and technology enhancements to the list of margin enhancers. Topping Morris’ list of technologies (outside of e-commerce) most likely to gain traction in 2019 are those designed to minimize out of stocks by identifying potential problems in real-time so retailers can react before a bad customer moment occurs. Other technologies likely to take hold in the coming year include port- able self-checkout (not quite Amazon Go but a step in that direction), more European-style kiosks, and AI for difficult and/or labor-intensive activities like building ads or setting prices and offers.

Morris says the Amazon Prime program at Whole Foods is a great example of grocery promotion done right. “Promotions exist, but they’re truly invisible,” he says, citing the dawn of the customer-based pricing era. “Pricing used to by chain, then division, then zone, then store, and now it’s moving to the individual customer.”

Read Full Article: What’s on the Menu? (pages 42-48)