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Outlook for U.S. sales is robust

BY Deena M. Amato-McCoy

Stronger consumer confidence could make 2018 a strong year for retailers.

That’s according to the National Retail Federation, which forecast that overall retail sales will rise between 3.8% and 4.4% in 2018 over last year. Online and other non-store sales, which are included in the overall total, are expected to increase between 10% and 12%. (The NRF numbers exclude automobiles, gas stations and restaurants.)

Retail sales grew 3.9% in 2017 over 2016 to $3.53 trillion, according to the U.S. Census bureau’s preliminary estimate for the year. The number, which is subject to revision, exceeded NRF’s forecast for growth of between 3.2% and 3.8%.

“A robust holiday season for retail sales is just one of many barometers that points to a consumer that is clearly feeling positive about their financial health,” said NRF president and CEO Matthew Shay.

“Despite headlines to the contrary, the retail industry is strong, growing and meeting consumer demand with the products they want at the prices they expect and the shopping experience they want to have, online or in store,” he added. “With consumer confidence high, unemployment low and wages growing, there is every reason to believe that retail sales will be robust throughout the year.”

As the overall economy gains strength, consumer confidence will continue to swell. For example, the economy is expected to gain an average of 163,000 jobs a month, down slightly from 2017, but consistent with labor market growth. Unemployment is expected to drop to 3.9% by the end of the year, and gross domestic product growth is likely to be in the range of 2.5% to 3%, according to NRF.

“The underpinnings of the economy are very good and consumer spending is at the center of our outlook,” said NRF chief economist Jack Kleinhenz.

“The push and pull of forces both external and internal to the U.S. economy will continue to provide challenges, but on balance we expect a good year,” he added. “And as the retail industry continues to transform, retailers will leverage the new tax plan to invest in their employees, stores and new formats that engage with the ever-evolving and demanding consumer.”

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Denim-inspired specialty retailer launches private-label credit card

BY Deena M. Amato-McCoy

Lucky Brand has a new way to drive loyalty and spur sales.

The specialty retailer is partnering with Alliance Data Systems Corp., to offer a private label credit card. Users will earn points by using the card for purchases. Members are also entitled to special offers and exclusive benefits, such as certificates for discounts.

Alliance Data will deliver data-driven insights through its prospecting services — the information Lucky Brand needs to identify potential news customers, and more effectively attract and gain more loyal, profitable customer relationships, the company said.

Alliance Data will also support ongoing integrated marketing programs, including in-store, digital, and mobile, as a means of driving brand loyalty and top-line sales.

The card will be accepted at the brand’s 154 specialty retail and 82 outlet locations throughout the United States, and online.

“At Lucky Brand, we are obsessed with customer centricity, this means that we put the customer at the center of everything we do as an organization,” said Carlos Alberini, CEO of Lucky Brand.

The credit card program coincides with this strategy, and “we are excited to offer our customers amazing new benefits,” he added.

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L Brands strong out of the gate

BY Marianne Wilson

L Brands is off to a great start in January.

The retailer, whose brands include Victoria’s Secret, Pink, Bath & Body Works, La Senza and Henri Bendel, reported that same-store sales rose 7% in January, easily beating analysts’ predictions of a 1.8% increase . Overall sales for the five-week period rose to $1.04 billion, up from $805.2 million in the year-ago period. (The extra week this January represented approximately $150 million in sales.)

By brand, same-store sales rose 4% at Victoria’s Secret’s in January, and 13% at Bath & Body Works, both beating expectations.

L Brands reported sales of $4.82 billion, up from $4.49 billion last year, for its fourth quarter, ended Feb.3. Same-store sales rose 2%.

For the full year, L Brands’ net sales were $12.63 billion, compared to $12.57 billion last year. Same-store sales fell 3%. The retailer said its exit from the swim and apparel categories had a negative impact of about 3 percentage points and 5 percentage points to total company and Victoria’s Secret comparable sales, respectively.

The company operates 3,078 company-owned specialty stores under its Victoria’s Secret, Pink, Bath & Body Works, La Senza and Henri Bendel banners in the United States, Canada, the United Kingdom, Ireland and Greater China.

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