Macy’s posts 16% increase in Q2 income; raises annual guidance
Cincinnati — Macy’s reported a nearly 16% increase in net income for its second quarter as the chain benefited from cost controls and its ongoing strategy of tailoring its fashions to local markets. The company said it was raising its full-year profit forecast.
Macy’s net income rose to $279 million for the three-month period ended July 28, up from $241 million in the year-ago period.
Revenue rose 3% to $6.12 billion, from $5.94 billion a year ago. Same-store sales also increased 3%. Online sales (Macys.com and Bloomingdales.com combined) were up 36.1% in the second quarter. (Online sales are included in the same-store sales calculation for Macy’s.)
"We were pleased with our spring season results, and they came on top of exceptionally strong spring season performances in each of the past two years," said Terry J. Lundgren, Macy’s chairman, president and CEO in a statement. "This indicates that our business continues to have forward momentum, even with challenges that include a soft economy, lower spending by international tourists and temporary disruptions" related to its major renovation of its flagship store in Manhattan.
The chief executive said the company would take a break in the remodeling of its flagship Herald Square store during the holiday season so as not to impede shopping.
Starbucks teams with Square to accept mobile payments; invests $25 million in company
Seattle — Mobile payments took another step forward with the announcement that Starbucks Coffee Co. has entered into a partnership with Square, a mobile-payment start-up. Starbucks will invest $25 million in Square — part of the latest round of financing — and Starbucks chairman, president and CEO Howard Schultz will join Square’s board of directors. Square was founded in 2009 by Jack Dorsey, creator of Twitter.
Starbucks Corp. will be the first national retailer to let customers pay with Square’s mobile payment application, whose users, to date, have been mostly small businesses.
The retailer said that beginning this fall, in addition to its existing mobile payment application it has rolled out, customers will be able to use Square’s Pay with Square to pay for their purchases. To use either of the programs, customers download the apps, then link a credit or debit card to the account. To pay at the register, they open the app and wave their phone in front of the scanner.
The Starbucks app can only be used at the company’s cafes and customers earn rewards when using it. But the Square app can be used wherever it is accepted. It shows users nearby businesses that accept Square payments.
“As the largest retail mobile payment platform in the U.S., we’re excited and proud to accept payments with Square,” said Howard Schultz, Starbucks chairman, president and CEO. “The evolving social and digital media platforms and highly innovative and relevant payment capabilities are causing seismic changes in consumer behavior and creating equally disruptive opportunities for business.”
NPD Group: Men’s grooming market grows at rapid pace
PORT WASHINGTON, N.Y. — The men’s grooming market continues to grow at a rapid pace as research shows that men’s grooming tools, such as electric shavers, men’s trimmers and home hair clippers, are among the largest dollar growth drivers in the overall personal care industry. Meanwhile, such product categories as men’s facial skin care continue to flourish.
Recent figures on men’s grooming tools and products released by the NPD Group, a market research company, revealed men continue to discover the benefits of keeping up appearances. NPD credited the influence of popular culture — and specifically, the increased appearance of facial hair on the red carpet — for the rise in men’s grooming tool sales. Recent results in this category also show men want to control hair growth on the body, as well as the face.
According to NPD’s consumer tracking service:
In the 12 months ended in June, sales of men’s electric shavers and men’s trimmers gained 9% and 12% in dollar sales, respectively. Facial trimmers grew 13% in dollar sales;
Pen trimmers and nose/ear trimmers together accounted for 13% of men’s trimmer dollars and increased 22% and 19% in units, respectively;
Body groomers gained nearly 16% in unit sales in the 12 months ended in June; and
Body groomers skew toward the under-35 age group and are even more popular among men under 25 years of age.
“Even though the overall personal care industry is currently flat, the men’s grooming categories are showing healthy growth,” stated Debra Mednick, executive director of NPD’s home business. “Men are purchasing the tools to help them get their look and looking good sells.”
Unlike women, men’s options are limited when it comes to covering up skin irritations, such as razor burn, nicks and acne. Survey results confirm men are more educated now than ever before about skin care problems and solutions.
According to NPD’s men’s grooming consumer report:
More than 9-out-of-10 men use some sort of grooming products today;
The men’s grooming industry generated $964 million in U.S. department store sales in 2011, an increase of 11%, compared with 2010;
Facial cleansers (excluding bar soap), facial lotions/moisturizers and lip products are the most commonly used products among male facial skin care users;
Men’s facial skin care grew 11% in dollars in 2011; and
Facial skin care product users are more likely to be ethnic men and men ages 18 to 34 years.
“Men have become increasingly conscious of the perks associated with looking good,” added Karen Grant, VP and senior global industry analyst at NPD. “They have a heightened awareness that looking good may provide them an advantage in the workplace as well as in their personal lives.”
“Men have different skin than women and the men’s grooming brands need to continue educating them as well as make them feel comfortable in the shopping environment to gain sales in this category,” Grant said.