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FirstData: Year-over-year retail dollar volume growth on Thanksgiving and Black Friday a healthy 5.6%

BY Staff Writer

Atlanta — Year-over-year retail dollar volume growth on Thanksgiving and Black Friday was healthy at 5.6% as many retailers started the holiday shopping season earlier this year and consumers welcomed the opportunity to find bargains, according to a study by First Data Corp.’s First Data SpendTrend analysis for Black Friday 2012 compared with Black Friday 2011. (SpendTrend tracks same-store consumer spending by credit, signature debit, PIN debit, EBT, closed-loop prepaid cards and checks at U.S. merchant locations.)

Retail category performance varied considerably with building material, garden equipment and supply dealers, and clothing and clothing accessories stores being the top performers. Average ticket growth at retailers swung from negative (-0.9%) in 2011 to positive (+1.9%) in 2012 over the Thanksgiving to Black Friday period. Shoppers boosted their overall spend and retailers shifted discounting strategies. The rise in average tickets reflect the strengthening position of retail as some merchants may have less of an incentive to drive sales at the expense of profits.

“Holiday spending got off to a strong start as consumers were attracted by retailers’ efforts to make shopping easier, including opening stores on Thanksgiving and expanding shipping and layaway options,” said Rikard Bandebo, VP and economist, First Data. “Even though spending was not quite as strong on the East Coast, spending in hurricane-struck areas was still healthy and consumer confidence has been strong.”

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Comps take a tumble at Target

BY CSA STAFF

A worse than expected 1% decline in November same store sales indicates the holiday season is off to a slow start at Target.

The 1% decline was substantially worse than the low single digit increase the company forecast at the start of the month when it reported a 2.4% increase for October that was toward the low end of guidance. The November weakness suggest traffic trends may be deteriorating at Target as the company said blamed the decline on a decrease in comparable store transactions following that metric’s flat performance in October.

"November sales were below our expectations, reflecting weaker-than-planned sales performance in the first two weeks combined with stronger sales growth across all channels later in the month," said Gregg Steinhafel, Target chairman, president and CEO. "Profitability for the month remained on plan, reflecting our efforts to balance thoughtful price investments in an intensely competitive environment with our continued focus on driving sales."

Steinhafel sought to reassure investors disturbed by the November performance that the best is yet to come from the company and indicated same store sales for the five week December reporting period would increase in the low single digits.

"With the upcoming launch of the Target/Neiman Marcus Holiday Collection, our unique assortment of exclusive, affordable merchandise and the compelling benefits of 5% REDcard Rewards and our Holiday Price Match, we believe Target has the right plans in place to allow our guests to shop with confidence throughout the holiday season," Steinhafel said.

As in prior months, Target’s strongest growth came in the food category which produced a mid single digit increase and in health and beauty which experienced a low single digit increase. However, the home and apparel categories both decreased in the low single-digit range and hardlines dropped by mid single digits. The company’s performance was strongest in portions of the south and softest in portions of the northeast.

The worse than expected comp figures comes as Target is experiencing a modest uptick in delinquency rates within in credit card receivables portfolio. Target said the percentage of accounts 60 days past due in November was 2.7% and the 90 days past due total was 1.9%. Those figures hit lows for the year of 2.5% and 1.7%, respectively, this past summer. Even at the slightly higher amount, both metrics are half of what they were several years ago.

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CEO succession unfolds at Coldwater Creek

BY CSA STAFF

Women’s specialty retailer Coldwater Creek said co-founder, chairman and CEO Dennis Pence will relinquish his role of CEO at year end.

Replacing Pence and joining the board of directors of the Sandpoint, Idaho-based chain will be Jill Brown Dean, the company’s current president and chief merchandising officer. Assuming Dean’s role will be Michele Donnan Martin who joins the company as SVP/GMM responsible for all merchandising functions.

Coldwater Creek operates 350 stores and Dean joined the company a little less than two years ago as part of a senior leadership transition to restore growth and increase profitability. Her promotion to CEO was well deserved, according to Pence.

"Her outstanding leadership, combined with her intimate knowledge of our customer and our brand, gives me great confidence in her ability to continue to lead the turnaround of our company, positioning us for a vibrant and successful second chapter in our history," Pence said. "In the last two and a half years, we have recruited a management team that has the skills and determination needed to execute to success, and Jill’s future role in leading this team will ensure the best possible results going forward."

Dean was an experienced apparel merchant when she arrived at Coldwater Creek in February 2011. She had spent the previous 18 years at The Limited and served as president of the Limited Too division and president and CEO of the Lane Bryant division.

Dean’s replacement, Michele Donnan Martin, joins the company with 25 years experience at retailers such as Delia’s, American Eagle, Williams Sonoma, Abercrombie & Fitch, J. Crew and Macy’s.

"Michele joins us at an important point in the company’s history," Dean said. "She is a seasoned merchant with extensive retail experience and a proven track record of success in developing and building consumer brands, and I am confident she will successfully build on the product foundation we have created in the past two years."

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