Study: Holiday Same-Store Sales to Fall 2.7%
New York City Chief marketing officers (CMOs) at leading U.S. retailers expect same-store sales for the 2008 holiday season to decrease from last year by a drastic 2.7%, according to a new study conducted by BDO Seidman. Thirty-nine percent of CMOs at leading retailers expect same-store sales to decrease this holiday season, while 41% expect sales to be flat and only 20% expect sales to increase. These findings are from the most recent edition of The BDO Seidman Retail Compass Survey, which surveyed CMOs at leading retailers throughout the country. The study was conducted after the financial market meltdown in September.
More than half (54%) of the CMOs cited uncertainty in the financial markets as the one external issue that will have the greatest impact on the holiday shopping season. Other issues cited were high energy and fuel costs (25%), unemployment (10%), the weak housing market (8%) and the presidential election (3%). The survey found that concerns about credit and the economy have led three-quarters (75%) of the CMOs to be more cautious about their sales and inventory purchase plans this holiday season.
An overwhelming majority (88%) of CMOs expect to offer more discounts and promotions this holiday season as a result of the economy and credit crunch, according to the study. Most of the CMOs (42%) cite that those discounts will take the form of in-store promotions, followed by markdowns (37%) and online promotions (20%).
“While there is much uncertainty in the retail sector this season, retailers have been consistent in citing reduced inventory purchases as a result of tightened credit and slow spending,” said Al Ferrara, a partner in the retail and consumer product practice at BDO Seidman. “Without a doubt, we can expect a very promotional environment that will appeal to cost-sensitive consumers, despite the impact it may have on shrinking margins.”
Giant Food signs 10-year banking deal with PNC
LANDOVER, Md. Giant Food has signed an exclusive, 10-year agreement with PNC Financial Services Group, under which PNC will provide banking services in Giant supermarket locations across Virginia, Maryland, Delaware and the District of Columbia.
“We are very excited and pleased to bring to our Giant customers a new in-store banking opportunity,” said Robin Michel, evp and general manager of Giant Food. Michel continued, “Many Giant customers have come to appreciate the convenience of full-service, in-store banking. With PNC, we expand an existing relationship with one of the nation’s best-performing banks, which has 12 years of in-store banking success and a strong network of banks in our market areas. We are also pleased to be providing our Giant customers with a bank that shares our commitment to the high-quality service that our customers expect.”
According to the agreement, PNC intends to open full-service, in-store branches. Initial plans call for 41 new in-store branches and 180 ATMs to be in place in 2009. In addition to locations in the District of Columbia, Virginia and Maryland, in-store branch locations will be in Delaware, where PNC already has in-store branches in three Giant stores. Under the agreement, more in-store branches and ATMs will be added in existing and new Giant stores during the next 10 years. Financial terms of the agreement were not disclosed.
Coca-Cola to place calorie info on front packaging
ATLANTA Coca-Cola North America announced it will voluntarily place calories-per-serving and servings-per-container information on the front of all packages for its entire U.S. beverage portfolio. The new label, which will begin appearing on packages next year, will highlight both calories per serving and number of servings per container.
“We view our label as a powerful tool for education, an opportunity to communicate with consumers every time they choose one of our products at the store or have a Coca-Cola beverage on their table,” said Celeste Bottorff, vp of Living Well. “We listen to what consumers tell us they want, respond creatively and encourage everyone to make informed decisions about what they drink, choices that reflect a sense of balance and moderation. It’s part of our Live Positively philosophy.”