Online Retailing Outpaces Stores -- WSJ

Date : 01/07/2017 @ 8:03AM
Source : Dow Jones News
Stock : Best Buy Co., Inc. (BBY)
Quote : 52.23  0.0 (0.00%) @ 10:12AM
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Online Retailing Outpaces Stores -- WSJ

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By Suzanne Kapner 

The shift to online shopping left chains with physical stores behind this holiday season.

First Data Corp., which tracked credit, debit and other card transactions at one million U.S. merchants, estimates that online sales increased nearly 11% from the previous holiday season, compared with just 2.7% growth at brick-and-mortar stores.

J.C. Penney Co. on Friday joined a host of retailers reporting a disappointing end to the year. Sales fell 0.8% for the nine-week period in November and December at Penney stores open more than a year. But the chain's online business grew by double digits.

As shoppers moved online, they increasingly went to Inc. The web retailer dominated the holiday season, garnering 38% of online revenue, according to Slice Intelligence, which analyzed digital shopping receipts. The next closest competitor was Best Buy Co., with a 4% share.

The divergence between declining foot traffic at physical stores and gains online played out across the industry. Macy's Inc. and Kohl's Corp. on Wednesday both reported weak holiday sales, and cut their earnings forecasts for the current fiscal year. Barnes Noble Inc., L Brands Inc. and Sears Holdings Inc. followed Thursday with their own disappointments, sending a number of retail stocks down during the day's trading.

G-III Apparel Group Ltd., which makes Ivanka Trump's clothes among other brands, said same-store sales in its current quarter will decline for its Wilsons Leather and G.H. Bass chains due to warmer weather, lower traffic and an "overall challenging retail environment."

RetailNext, which analyzed 31 million shopping trips, estimates that sales at brick-and-mortar chains fell 10% in November and December, while traffic declined 12%. But the average transaction value increased 5%, softening the blow.

According to First Data, electronics and appliances fared the best with sales gains of 8.5% during the holiday season, while clothing and accessories performed the worst, increasing sales just 0.1%.

A few apparel chains, including Gap Inc. and PVH Corp., bucked the downward trend.

Gap reported that store sales rose 2% on a comparable basis in November and December, boosted by a jump in its low-cost Old Navy division and a return to same-store sales growth in its flagship chain for the first month since April 2014.

PVH Corp., which owns Tommy Hilfiger, Calvin Klein and Van Heusen brands, raised its earnings guidance for the current period and the fiscal year. The upbeat outlook came despite the company's dependence on department stores, which have been shrinking.

Two of the country's biggest retailers, Wal-Mart Stores Inc. and Target Corp., have yet to update investors on their holiday results.

--Anne Steele contributed to this article.

Write to Suzanne Kapner at


(END) Dow Jones Newswires

January 07, 2017 02:48 ET (07:48 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.

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