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Report: Total U.S. retail sales for July up 8.7% year-over-year

BY Katherine Boccaccio

Purchase, N.Y. — A report released Thursday by MasterCard Advisors said that total retail sales in July sustained momentum despite inconsistencies in other areas of the economy.

According to MasterCard SpendingPulse, which tracks national retail and service sales, excluding auto sales retail sales in July 2011 grew by 8.7% year-over-year.

Retail sales are on par with the average growth of the previous three months.

“Since March, non seasonally-adjusted retail sales have topped 8% year-over-year,” said Michael McNamara, VP research and analysis for MasterCard Advisors SpendingPulse. “However, much of the 8.7% growth is from commodity-based inflation in areas such as gasoline, food and cotton prices.”

McNamara cautioned that, while the headline year-over-year increase resembles periods of strong economic growth, “when you take a closer look at the comp environment and the year-over-year inflation, it tempers the enthusiasm that would normally accompany this level of year-over-year increase,” he said.

Sectors showing positive results in July included e-commerce, luxury, apparel, groceries and travel. E-commerce posted double digit growth for the ninth consecutive month, with the unusually hot weather this July perhaps pushing consumers to e-commerce in greater numbers. Luxury posted its 10th consecutive month of positive year over year growth. In July there was the first double digit growth since April 2010. Weaker segments included furniture and furnishings, automotive repair, and electronics and appliances. Furniture and furnishings were negative year over year for the sixth consecutive month, likely due to their ties with the struggling housing sector. In addition, automotive repair and maintenance went into the negative for the first time since January 2011.

Retail Spending posted positive growth in every part of the country, with the best unadjusted year-over-year results in the Pacific and South central regions, respectively posting 11.0% and 11.9% growth.

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Retail revolution in NWA continues

BY CSA STAFF

Outdoor retailer Cabela’s has announced plans to open one of its signature stores in Rogers, Ark., next summer, continuing an influx of retail development that has steadily elevated the region’s shopping options.

A decade ago, the biggest decision facing shoppers who lived in Benton County was which Walmart to shop at. Either that or drive to Fayetteville where an aging mall featured Dillard’s and JCPenney as anchor tenants. Other folks made the two-hour trek to Tulsa, Okla., which boasted more choices, but hardly qualified as a shopping Mecca.

Then a few years ago the Pinnacle Hills Promenade lifestyle mall open in Rogers and so did a new Target discount store, Best Buy and an Academy Sporting Goods superstore.

Cabela’s plans call for construction to begin in early 2012 at a site near the Pinnacle Hills Promenade mall and for the store to be open by next summer. The building’s exterior will reflect Cabela’s traditional store model with log construction, stonework, wood siding and metal roofing. A large glass storefront will allow customers to view much of the store’s interior as they approach the building. The 110,000-sq.-ft. store will feature the company’s next-generation layout, which is designed to immerse customers in the outdoor experience and includes conservation-themed wildlife displays and trophy animal mounts displayed on an indoor mountain with a built-in aquarium.

Cabela’s will be a welcome addition to the region’s outdoor enthusiasts and all that’s missing now is a Costco, Whole Foods and maybe Nordstrom or Macy’s.

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S&S boosts sales using IBM software in the cloud

BY Staff Writer

Armonk, N.Y. — IBM announced that S&S Worldwide grew recommendation sales 75% in just three months with IBM Smarter Commerce software in the cloud. S&S is a national distributor of sporting goods products for recreation, health care, and education professionals and is using IBM software to drive personalized product recommendation sales via its Web sites.

S&S Worldwide had been using a native application to serve up generic product recommendations on its Web site that accounted for only 5% of all online sales. But consumers today expect clear relevance to their interests at every step of the online shopping experience. Personalized product recommendations help meet that demand and generate a substantial revenue lift for the company.

Using IBM’s Smarter Commerce software that delivers cloud-based analytics and marketing personalization, S&S product recommendations sales for its art supplies and sporting goods offerings surged to 9.8% of all Web sales in just three months, a dramatic improvement. At the same time, product views shot up 24% and viewing sessions increased 30%.

The IBM solution at S&S Worldwide integrates data and predictive analytics to generate site merchandising. It analyzes key information at each point in the online shopping process, such as tracking all visitor preferences. The system is then able to analyze that data to automate product offers to other customers with similar behavior on the site. This gives returning customers the ability to view products they previously showed an interest in, and it also allows S&S Worldwide to cross-sell and up-sell related products.

"The results have been quite impressive with the IBM Smarter Commerce cloud service. The recommendations have led directly to a much more tailored and compelling customer experience," said Will Bender, web merchandising manager, S&S Worldwide Colchester, Conn. "We’re now able to make decisions and track results very thoroughly based on data – not what we think should be on the site, but what the data tells us."

S&S Worldwide has started to tie IBM to its personalized email marketing initiatives, as well. Using IBM software, S&S Worldwide was able to identify and target people who browsed items on the site but did not put any items in the shopping cart. These visitors received an email message that included content regarding products browsed along with suggestions for other items within the same product category.

This initial campaign yielded instant results. The click-to-order conversion rate was 33 percent, which is approximately three times higher than the average rate for similar S&S Worldwide email marketing campaigns. In addition, the open rate was 60 percent, approximately 50% higher than that of previous campaigns. S&S pays a fraction of a penny per email message, yet the campaign earned $1.32 per message sent, an extremely high return-on-investment.

S&S has used personalized emails, product reviews, live chat and other interactive Web analytics and marketing techniques to steadily grow its Web sales to about 35% of its overall business, with approximately 11,000 products.

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