Mobile Commerce accelerates as holidays approach
Total m-commerce spending is poised to exceed $25 billion this year following a 24% surge in second quarter smartphone and tablet enabled sales that pushed estimated spending to $4.7 billion, according to digital measurement provider comScore.
The firm said m-commerce spending in the first half of the year totaled $10.6 billion, representing 10% of total digital commerce during that time. With the expected seasonal surge coming in the fourth quarter, m-commerce spending could surpass $25 billion for the full year, according to comScore’s estimates.
“While mobile devices are already extremely influential in the overall buying process, they are also beginning to drive a meaningful percentage of digital commerce,” said comScore chairman Gian Fulgoni. “One out of every ten consumer e-commerce dollars is now spent using either a smartphone or a tablet, and growth in this segment of the market is outpacing that of traditional e-commerce by a factor of 2x, which itself is growing at rates in the mid-teens. Any channel shift has the potential to be disruptive to established revenue streams, and it would appear that m-commerce spending has reached enough of a critical mass that key stakeholders must begin to address this new market dynamic today or risk losing competitive advantage.”
According to the firm’s data, the product categories with the highest m-commerce penetration rates were apparel and accessories (9.7%), consumer electronics (5.5%) computer hardware (5.4%), consumer packaged goods (4.3%).
ComScore’s data indicates smartphones drove a considerably higher share (6%) of total digital commerce than tablets (3.5%. While smartphone users outnumber tablet users by a factor greater than 2x, the average spending per device owner is actually 20% higher on tablets. This is likely a function of the platform’s higher income demographics and its greater similarity to the desktop experience due to its larger screen size, according to comScore.
Provigo Le Marché, Kirkland, Quebec (Canada)
Provigo, a division of Canada’s Loblaw Cos., has opened the second location under its new Provigo Le Marché banner, a flagship in the Montreal suburb of Kirkland. The 82,000-sq.-ft. store combines the convenience and variety of a full-service supermarket with a food market-styled layout. It offers an expanded range of fresh products, and gives center stage to local and regional items.
Inspired by the design of Loblaw’s Maple Leaf Gardens store in Toronto, the new flagship has a sleek look, accented with bold signage. Specialty offerings include a juice bar, a towering wall of cheese with more than 400 varieties, and a sushi bar.
Health-and-wellness also figures into the new format. An in-store dietitian is available to assist customers, and pharmacists offer such services as measuring blood pressure, blood glucose and cholesterol levels. A fitness studio is located on the second level of the store.
Loblaw debuted the Provigo Le Marché banner in July, in Sherbrooke, Quebec. Five additional stores are expected to open by the end of the year.
Photo credit: Martin Viau
Delia’s continues facing challenges in Q2
NEW YORK — Multichannel retailer Delia’s, which markets primarily to teen girls, continues facing challenges in traffic trends as it wrapped up the second quarter ended Aug. 3 with total revenue of $33.2 million, a 16.7% drop from $39.8 million in the year-ago quarter.
The company’s legacy inventory continues to underperform, leading to a drop of 14.7% to $24.5 million in its retail segment from $28.7 million for the year-ago quarter. The dip was primarily due to a comparable store sales decrease of 14.9%, compared to a 14% increase in the year-ago quarter. Revenue from the direct segment decreased 21.8% to $8.7 million.
Consolidated gross margin was 20.9% compared to 31.6% in the prior year quarter, primarily due to increased inventory reserves, lower merchandise margins associated with higher markdowns on legacy product and the deleveraging of occupancy costs.
“Our second quarter results were indicative of challenging traffic trends, combined with the underperformance of our legacy inventory. We expect these trends to continue throughout the third quarter as we work to move through this inventory,” said Tracy Gardner, CEO. “The team is currently focused on stabilizing the business, amplifying the Delia’s brand image and driving improved execution in the near term. During this period, we are also focused on implementing our go forward strategy that we believe will better position us for more consistent long term growth. While we acknowledge that this turnaround will take time, we remain excited about our future potential.”
The company relocated one store location in the same mall during the quarter, ending the period with 103 stores.