Survey: Projected improvements lead retail CMOs to increase holiday inventory purchases
Chicago A survey released Tuesday by accounting and consulting firm BDO USA, LLP found that chief marketing officers at leading U.S. retailers expect same-store and overall sales to increase by 2.83% and 3.51% respectively, for the 2010 holiday season, compared with holiday 2009 projected upticks of 1.4% same-store and 2.6% overall sales.
According to the BDO USA Retail Compass Survey of CMOs, which examined the opinions of 100 retail chief marketing officers, CMOs say they increased their inventory purchases by 2.8%. More than one third (33%) of CMOs say their inventory purchases have measurably increased since last year and only 16% of retailers are citing a decrease. Stable inventory levels have been largely reported, with 52% of CMOs saying their volume has stayed about the same.
“Retailers appear more optimistic for the 2010 holiday season, a sign of the industry’s resilience,” said Doug Hart, partner, retail & consumer product practice of BDO USA. “Retailers expect the recent positive momentum to continue now that consumer spending is gradually improving. While retailers continue to carefully manage inventory levels, some are planning to broaden product offerings for the 2010 holidays, a major change from 2009.”
Other major findings of the survey, which polled large retailers with revenues ranging from $100 million to $100 billion, included: Shoppers could expect to see a little more variety in stores this year; though likely from a select number of brands as strict inventory management remains critical. When it comes to SKUs for the upcoming holidays, CMOs say they have increased by .88%. More than one-third (31%) of CMOs say they are increasing their SKUs while 45% are making no change. Only 16% of retailers are decreasing their SKUS for the 2010 holiday season.
More than half (52%) of CMOs expect their overall sales for the 2010 holiday season to increase compared to last year and many (36%) expect sales to remain steady. Only 13% of CMOs expect 2010 holiday sales to decrease. This shows growing optimism for the sector since 2008, when 40% expected a decrease, accurately predicting a 2.8% decline. In 2009, actual holiday sales rose 1.1%.
Projecting a 2.83% increase in same-store sales, retailers are strengthening their outlook from 2009 when they forecasted only a 1.4% increase. Almost half (48%) of CMOs say same-store sales will increase, while 43% of CMOs say sales will be flat when compared with 2009. Only 8% of CMOs expect flat same-store sales this year, an increase from last year (10%) and drastic reduction from 2008 (39%).
More than half (53%) of CMOs say stagnant consumer spending and low confidence levels will have the greatest impact on 2010 holiday sales. While still a concern, unemployment (22%) carries less weight on holiday sales this year, a notable decrease from 2009 (67%).
Of the retailers who sell gift cards, 47% expect an increase in sales this holiday season. Forty percent expect flat sales and only 13% of CMOS expect a decrease in gift card sales.
GSMA announces latest speaker lineup for Mobile World Congress
LONDON The GSMA announced that the CEOs of Intel, Microsoft, Nokia, NTT DoCoMo, RIM, SoftBank and Yahoo! will be making keynote speeches at Mobile World Congress, which will be held Feb. 14 to 17, 2011 in Barcelona.
“The 2011 Mobile World Congress features an unparalleled lineup of keynote speakers from companies spanning the full mobile communications ecosystem,” said Michael O’Hara, chief marketing officer, GSMA. “Attendees will have access to the individuals and organisations who are leading the mobile transformation, gaining important perspectives and insights on the future of communications.”
Recently confirmed Mobile World Congress keynote speakers are:
* Paul Otellini, president and CEO, Intel * Steve Ballmer, CEO, Microsoft * Stephen Elop, president and CEO, Nokia * Ryuji Yamada, president and CEO, NTT DoCoMo * Jim Balsillie, co-CEO, Research In Motion * Masayoshi Son, chairman and CEO, SoftBank * Carol Bartz, CEO, Yahoo!
Previously announced speakers include:
* Daniel Hajj, CEO, America Movil and Telcel * Randall Stephenson, chairman, CEO and president, AT&T * Li Yue, president and CEO, China Mobile * Eric Schmidt, chairman and CEO, Google * Peter Chou, CEO, HTC * Paul Jacobs, chairman and CEO, Qualcomm * Jack Dorsey, CEO, Square * Evan Williams, co-founder, Twitter * Vittorio Colao, chief executive, Vodafone * Sir Martin Sorrell, chief executive, WPP
One size does not fit most
Apparel sales at Target were weak in October, registering a decline in the low single-digit range, while sales at competitors with greater exposure to apparel were mixed. For example, Macy’s registered a 2.5% comp increase, but such rivals as Dillard’s, JCPenney and Kohl’s posted declines of 1%, 1.9% and 2.5% respectively. Meanwhile, such off-price chains as Ross Stores and TJX Companies continue to show strength and exceeded their sales plans. Ross gained 4% and TJX results, although flat for the month, were at the high end of the company’s guidance that was tempered by a double digit gain the prior year. The strongest performance was turned in by retailers who appeal to more affluent shoppers. Saks reported an 8.1% increase and Nordstrom posted a 3.4% increase.