Company Earnings UpdateRoss (ROST) 3Q18 Results: In Line with Expectations; Raises Full-Year EPS Guidance Coresight Research November 21, 2018 Executive Summary Ross Stores reported 3Q18 revenues of $3.55 billion, up 6.6% year over year and in line with the consensus estimate. Diluted EPS was $0.91, up 26.9% year over year and $0.01 above the consensus estimate of $0.90. Comparable sales increased by 3.0% year over year, beating the consensus estimate of 2.8%. Ross Stores expects 4Q18 sales to decrease 1%-2% and provided 4Q18 guidance for EPS in the range of $1.09–$1.14, compared to the consensus estimate of $1.08, which includes a one-time, non-cash benefit of approximately $0.97 per share related to the favorable resolution of a tax matter. The company raised its full-year earnings per share guidance to $4.15–$4.20, from $4.01–$4.10. Please Login to read the full report. Not a member? To access this content for free, register for a free account. This document was generated for
Company Earnings UpdateKohl’s (KSS) 3Q18 Results: Sales Rise Due to Rivals’ Store Closures; Raises EPS Guidance Coresight Research November 21, 2018 Executive Summary Kohl’s reported 3Q18 net sales of $4.37 billion, up 1.3% year over year and in line with the $4.37 billion consensus estimate. Adjusted EPS was $0.98, beating the $0.95 consensus estimate and up from $0.70 in the year-ago quarter. Comparable sales were up 2.5% year over year, beating the consensus estimate of 2.4%. Kohl’s raised its full-year earnings guidance per share and now expects FY18 EPS to be $5.35–$5.55, up slightly from prior guidance of $5.15–$5.55 but still in line with the consensus estimate of $5.49. This excludes the one-time debt extinguishment charge of $42 million or $0.19 per share taken in the first quarter. For the full year, the company expects comparable sales to increase 1%–2%. Please Login to read the full report. Not a member? To access this content for free, register for a free account. This document was generated for
Insight ReportWeather Forecasters Expect a Chilly Black Friday Coresight Research November 21, 2018 Executive Summary The Thanksgiving and Black Friday holiday week is forecast to be colder than last year, with the US Northeast expected to experience at or near record cold, according to Planalytics. Snow is expected from Massachusetts to Albany, with wind chills falling below zero in the Northeast and into the teens from Philadelphia to Washington, DC. Temperatures across the US Gulf coast and the Canadian prairies are expected to be warmer than last year. The forecast calls for higher weather-driven demand for winterwear in Denver, fleece in New Orleans, sweaters in Phoenix and boots in Montreal. December weather is expected to be warmer and wetter than last year, which should drive relative demand for restaurants, home centers and specialty apparel and reduce demand for gloves, boots and hot cocoa throughout most of the continental US. Black Friday Forecast: Much Colder than Last Year The Thanksgiving-Black Friday holiday week is expected to be colder than last year, with extreme cold hitting on Thursday, November 22 and Friday, November 23. Snow is expected from Massachusetts to Albany, with wind chills falling below zero in the Northeast and into the teens from Philadelphia to Washington, DC. Temperatures across the US Gulf coast and the Canadian prairies are expected to be warmer than last year. The figure below shows a temperature forecast map (versus last year) for the Thanksgiving-Black Friday week in the US and Canada. Source: Planalytics The colder weather year over year should drive demand for apparel such as winterwear in Denver (29% higher), fleece in New Orleans (16% higher), sweaters in Phoenix (14% higher) and boots in Montreal, as well as other winter needs such as ice melt in Boston and snow throwers in Minneapolis (19% higher). Demand for cocoa is expected to be 11% higher in Nashville. Source: Planalytics December Forecast: Warmer and Wetter The December forecast is expected to be warmer than last year, particularly in Eastern Canada, but cooler in the US Southwest. The forecast also calls for more precipitation than last year across most of the US. Source: Planalytics Demand is expected to be higher for fleece in the Southwest but lower for boots, gloves and hot cocoa across the rest of the US. The impact of the warmer weather is expected to generate an incremental $1.1 billion in sales for restaurants, $727 for home-center stores and an additional $247 million for specialty apparel. Poor air quality caused by fires in northern California could dampen holiday spending in the San Francisco Bay Area. This forecast should generate weather-driven demand in December as illustrated below. Source: Planalytics The warmer weather is expected to drive lower demand for ice melt in Toronto, gloves in New York City and jackets in Atlanta. This document was generated for
Insight ReportUlta Beauty 2018 Analyst and Investor Day: Ultamate Rewards Loyalty Program Driving 95% of Revenue with 30 Million Members; Ulta Continues to Diversify Beyond Mass Cosmetics Coresight Research November 20, 2018 Executive Summary More than 95% of Ulta’s sales go through the company’s Ultamate Rewards loyalty program, which now has more than 30 million members. Membership in the program grew by 64.8% from 2015 to 2018. Ulta has added more than 250 brands since 2016. The company is concentrating on newness and on diversifying its product portfolio. Ulta’s focus is on exclusives (which account for 9% of sales), independent brands and prestige brands. The company is partnering with celebrity Kim Kardashian West to sell four of her fragrances in stores beginning November 25, and with her sister, Kylie Jenner, to sell Jenner’s Lip Kit in stores beginning November 17. These collaborations will provide customers the opportunity to try products that were previously available only online. Both Kardashian West and Jenner have millions of social media followers. Ulta is investing in technology to build an innovation ecosystem, with the goal of becoming the digital store of the future. The company is focusing on personalization and connecting online and offline experiences in order to tailor its communications and help consumers navigate the beauty space. Ulta invested in tech startup Spruce to facilitate guest booking for its salon business and in digital workflow platform Iterate. The company also acquired artificial intelligence (AI) startup QM Scientific and AI and augmented reality (AR) startup GlamST. On November 8, Ulta Beauty hosted its annual Analyst and Investor Day in Itasca, Illinois. The day consisted of presentations from CEO and Director Mary Dillon, SVP of Brand Marketing Shelley Haus, Chief Merchandising and Marketing Officer Dave Kimbell, SVP of Merchandising for Prestige Beauty Tara Simon, CFO Scott Settersten, Chief Store Operations Officer Kecia Steelman, SVP of Digital and E-Commerce Prama Bhatt and Chief Supply Chain Officer Derek Hornsby. The main themes of the day included customer loyalty, new products, celebrity collaborations, technology investments and bringing newness to the product assortment with a focus on exclusives, independent brands and prestige brands. The company announced that it will no longer provide quarterly guidance. Ulta will provide specific annual guidance on its fourth-quarter earnings calls and update that as needed throughout the year. Ulta also announced that it is retiring its “All Things Beauty, All in One Place” slogan and replacing it with “The Possibilities Are Beautiful” as its new brand expression. Ulta’s Net Sales Grew by 120% from 2013 to 2017 As of November 8, Ulta operated 1,163 stores in 50 states as well as its Ulta.com online store. Some 96% of Ulta stores are approximately 10,000 square feet in size. The company is moderating its store opening plans, and now plans to open 80 stores in 2019, and 70–75 stores in each of the following two years, with a target of operating 1,399 stores in 2021. The company’s previous estimate, as of August 30 this year, was to operate 1,400–1,700 stores in the US over the next few years. When asked about international expansion, CEO and Director Mary Dillon said, “We’re studying; we don’t have anything to announce today.” Ulta grew revenues by 120% from 2013 to 2017, from $2.67 billion to $5.88 billion. The company raised its fiscal year 2018 comp guidance from 6%–8% growth to 7%–8% growth and reiterated its full-year EPS guidance of “low 20% growth.” Slide from Ulta Beauty 2018 Analyst and Investor Day presentation Source: Ulta Beauty More than 95% of Ulta’s Sales Go Through the Ultamate Rewards Loyalty Program Dave Kimbell, Chief Merchandising and Marketing Officer, said that membership in the company’s Ultamate Rewards loyalty program has grown by 64.8% over the past three years, from 18.2 million members in 2015 to 30 million members as of November 2018. Kimbell said that more than 95% of the company’s sales go through the loyalty program, which enables Ulta to track all of those items back to an individual, providing the company with a deep understanding of purchasing behavior. Slide from Ulta Beauty 2018 Analyst and Investor Day presentation Source: Ulta Beauty Ultamate Rewards Loyalty Members Spend $200 Annually and Hold 30% Share of Wallet Kimbell said that Ultamate Rewards loyalty program members spend an average of $200 per year at Ulta and account for 30% of all beauty spending at Ulta. They also represent 30% of all “beauty enthusiasts,” he said. Ulta’s loyalty program has three tiers, Member, Platinum and Diamond. Its Platinum and Diamond members represent more than 40% of beauty spending, while Regular members account for 30% of beauty spending. Slide from Ulta Beauty 2018 Analyst and Investor Day presentation Source: Ulta Beauty Ulta Has Added 250+ Brands Since 2016 and Has Focused on Exclusives and Independent Brands and on Introducing Customers to Prestige Brands Ulta reported that it has added more than 250 brands since 2016, 100 of which are in skincare. The company reported that it is seeing a blurring of the lines between mass (drugstore brands) and prestige (premium) brands, with most Ulta guests shopping across both brand segments. Tara Simon, SVP of Merchandising for Prestige Beauty, said that the company’s customers are exhibiting “mass migration,” meaning they may start at Ulta buying mass brand products and then, over time, begin buying prestige products, while continuing to buy just as many, or more, mass brand items. By introducing consumers to prestige brands, the company is gaining share of wallet. Simon reported that Ulta currently holds 23% of the prestige beauty market, according to The NPD Group, up from 15% in 2016, with the majority of the growth since 2016 coming from cosmetics. Slide from Ulta Beauty 2018 Analyst and Investor Day presentation Source: Ulta Beauty Simon said that over the past two years, Ulta has added more prestige brands and increased penetration of its prestige portfolio, which includes Chanel, Clinique, Estée Lauder, Kate Somerville, Kiehl’s, Lancôme, MAC, Mario Badescu, NARS and Peter Thomas Roth. The company is also focused on bringing independent brands in-store and is working with digitally native brands. Ulta reported that it is seeing significant growth in brands that it has introduced, including ColourPop, Dose of Colors, Juvia’s Place and Morphe. Simon said that the company sees the expansion of all brands across its portfolio as an opportunity to increase its share of wallet. Ulta has increasingly focused on new and exclusive products to include in its Ulta Collection. Exclusive products that are sold only at Ulta represent 9% of the company’s portfolio. The Ulta Collection and products that were designed specifically for Ulta, such as IT Brushes for Ulta and Tarte Double Duty Beauty products, represent about 6% of the business. The remaining 3% of the exclusive portfolio includes partnerships with brands such as Morphe and Kylie Cosmetics, where Ulta serves as the brand’s exclusive brick-and-mortar retail partner. Slide from Ulta Beauty 2018 Analyst and Investor Day presentation Source: Ulta Beauty Ulta Announces Collaborations with Kylie Jenner and Kim Kardashian West Simon announced that Kylie Jenner will launch Kylie Cosmetics at Ulta on November 17, both in stores and online, beginning with the brand’s Lip Kit. Jenner has more than 118 million followers on Instagram and, in 2016, her Lip Kit sold out within one day of the initial launch. This announcement followed news that Kylie Jenner’s sister, Kim Kardashian West, is launching four scents in her KKW Fragrance line at Ulta for the holiday season. The KKW Fragrances will be available in Ulta stores (but not on Ulta.com) beginning November 25. Simon highlighted that these partnerships will provide customers with an opportunity to try products that were previously only available online. She added that Kylie Jenner “is super excited to be able to have a place for her fans to come and actually touch the product and try it because she’s selling a whole lot of this online, and nobody’s ever touched the stuff before they buy it. So, we couldn’t be happier. We think it is going to drive a lot of traffic to the stores.” Slide from Ulta Beauty 2018 Analyst and Investor Day presentation Source: Ulta Beauty Ulta Is Investing in Technology to Build an Innovation Ecosystem with the Goal of Becoming the Digital Store of the Future Prama Bhatt, SVP of Digital and E-Commerce, said that the company is creating a commerce and content platform that connects its physical and digital guest journeys. The company emphasized that its main focus is on personalization and connecting online and offline experiences in order to tailor its communications and help consumers navigate the beauty space. Bhatt provided an overview of the company’s technology partnerships and acquisitions: Ulta invested in technology startup Spruce to develop a services system to facilitate booking salon appointments. The system aims to increase consumer engagement. Spruce is live in Ulta’s pilot store and Ulta plans to launch the new system in a limited number of stores in 2018 and then roll it out to its entire fleet in 2019. In September 2018, Ulta acquired QM Scientific, an AI startup with capabilities in computer vision, recommendations, natural language processing and visual search. QM Scientific has been recognized by the National Retail Federation as a disruptor in the retail space. Ulta also acquired GlamST, which it had partnered with to develop the GLAM LAB virtual try-on experience, in order to help build out its capabilities for AI and AR. GlamST combines AI, AR and machine learning capabilities with a focus on virtual makeover solutions, image processing, graphics and effects. Ulta has made foundational investments in Iterate, a digital workflow platform that tracks trends, provides research and curates technology partnership opportunities. Iterate enables rapid prototyping and provides access to startups. Slide from Ulta Beauty 2018 Analyst and Investor Day presentation Source: Ulta Beauty This document was generated for
Deep DiveNetEase, Alibaba and JD.com March into Private Label Coresight Research November 20, 2018 Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportUrban Outfitters (URBN) 3Q18: Company Beats Expectations and Plans International Expansion Coresight Research November 20, 2018 Executive Summary Urban Outfitters reported fiscal 3Q18 revenues of $973.5 million, up 9.0% year over year and beating the $967.9 million consensus estimate. Adjusted EPS was $0.70, beating the $0.62 consensus estimate and up from $0.41 in the year-ago quarter. Comparable sales were up 8.0% year over year, even with the consensus estimate of 8.0%. The company did not provide quantitative guidance for FY19. In early 2019, Urban Outfitters plans to open its second European location. Additionally, the company plans to open a Free People’s first franchise location in Tel Aviv. Source: Company reports/Coresight Research 3Q18 Results Urban Outfitters reported 3Q19 revenues of $973.5 million, up 9.0% year over year and above the consensus estimate of $967.9 million. Adjusted EPS was $0.70 up 70.7% from the year-ago quarter, above the consensus estimate of $0.62 and above last year’s EPS of $0.41. By brand, Anthropologie Group net sales were $385.0 million, up 9.4% year over year. Urban Outfitters brand sales were $379.2 million, up 7.2% from the year-ago quarter. Free People sales increased 12.0%, to $202.2 million, and Food and Beverage sales increased 14.5% to $7.1 million. By division, retail net sales increased by 8.7%, to $878.9 million and wholesale segment sales were up 12.4%, to $94.7 million. The company reported that store comps have been positive for each of its brands for the third straight quarter, due to increased average unit selling prices and increased units per transaction. By brand, Free People comps were up 12.0%, below the 13.4% consensus estimate. Anthropologie Group comps were up 8.0%, beating the 6.4% consensus estimate, and Urban Outfitters brand comps were up 7.0%, below the 7.8% consensus estimate. The company reported that in retail, both digital and store channels comps delivered positive results. Digital led the way, posting double digit sales increases at each of the brands, driven by increases in sessions, average order value (AOV) and conversion rate. During the nine months ending October 31, 2018, the company opened a total of 14 new locations—three Free People stores, four Anthropologies Group stores, four Urban Outfitters stores, and three Food and Beverage restaurants; the company closed four locations: one Urban Outfitters store, one Free People store and two Anthropologie Group stores. During the nine-month period, three franchise-owned Urban outfitter stores were opened. The company reported that its international business is a strategic focus for the brand. In November 2018 it opened its first retail location in Amsterdam. Outlook The company did not provide quantitative guidance for FY19. In early 2019, Urban Outfitters plans to open its second European location. Additionally, the company plans to open Free People’s first franchise location in Tel Aviv. This document was generated for
Insight ReportBlack Friday Advertisements: Previewing US Retailers’ Doorbusters Coresight Research November 20, 2018 Executive SummaryAs Black Friday approaches, retailers are kicking off holiday promotions. In this note, we will look at Amazon, Best Buy, Costco, CVS, Five Below, JCPenney, Kohl’s, Macy’s, Old Navy, Target and Walmart. Early Black Friday deals are available on Amazon now, with more scheduled for November 16–23. Old Navy has Black Friday creep as well. New tech and electronics will be traffic drivers for e-commerce and brick-and-mortar businesses, with big screen smart TVs, iPhones, Amazon and Google smart products available at multiple retailers. Many retailers will open their doors Thanksgiving evening and open early Friday with doorbuster sales. Amazon Amazon has started its Black Friday deals. Customers can save up to 30% on select games and puzzles, Lark & Ro winter essentials and Callista cotton sheet sets. The company offers 20% off its exclusive home essentials. Amazon is selling the HP ENVY printer for $89.99, Ultimate Ears BOOM 3 Portable Bluetooth Wireless Speakers for $129.99 and Aimores Professional Blenders for $74.99. Amazon had 25 pages including 798 items of women’s fashion early Black Friday deals on Wednesday November 14, 14 pages of men’s fashion, nine pages of beauty, four pages including 127 items of girls’ fashion and three pages including 80 items of boys’ fashion. Best Buy Best Buy will open at 5 pm on Thanksgiving Day. Doorbuster deals include an in-store only 43-inch 4K TV for $129.99. Best Buy will offer the Amazon 2nd generation Echo Dot for $19.99, 128G Wi-Fi iPad Mini 4s for $249.99 and Google Home Hubs for $99.99. A selection of premium electronics at discounted price for Black Friday are available online for purchase now. Customers can get Jaybird X3 Sport Wireless in-ear headphones for $59.99 online. Best Buy Black Friday Advertisement Source: Best Buy Costco Costco will close on November 22, but the company has special online one-day offers for November 22. Deals include $1,300 off an LG22 cubic foot refrigerator and $70 off a 32GB 9.7-inch iPad. Costco stores will open at 9 am on November 23 and offer different promotions through November 26. The company will take $8 off whole boneless pork loin, $4 off Fresh Fryer boneless & skinless chicken breasts and $25 off USDA Prime Beef Loin. Costco will offer a bundle of 3 Google Home Minis for $69.99 and take $100 off the Dyson V8 vacuum. CVS CVS will remain open for regular hours on Thanksgiving Day. The company offers buy one get one free on select toys and M&M’s. Several Colgate products will be free with a CVS card and coupons. The 23andMe Genetic DNA Starter Kit is free after ExtraBucks Rewards. A selection of plush will be on promotion for 25% off. CVS.com will offer free shipping on every order all season long and 30% off regular prices. Five Below Five Below will open from 6 pm on Thanksgiving Day till 1:00 am Friday and open again 7 am to 9 pm on Friday. Products such as Micro Remote Control Quadcopter, Infinite Wrap Pro Headset and Guitar Hero Live Game will be available at $5 as a part of special promotions only on Thursday and Friday. In addition, customers will find 7 oz giant Hershey’s kisses, buy one get one 50% off. The company also has a selection of goods on sale for the following weekend. JCPenney JCPenney will open at 2 pm on Thanksgiving Day and early shoppers can win coupons such as $500 off $500 or $100 off $100 or $10 off $10 at each location. A selection of toys will be on sale for 50% off. Holiday décor including ornaments and trees will be available for 60% off. Customers will get a $25 off $25 coupon if they spend $100 on gift cards, in store only through November 24. JCPenney will sell a selection of Red Box women’s boots for $19.99 and sweaters from different brands for $9.99. In addition, the company will offer up to 80% off on fine jewelry. JCPenny.com Source: JCPenny Kohl’s Kohl’s will open at 5 pm on Thanksgiving Day. November 19-23, for every $50 spent, the company will offer $15 Kohl’s Cash. Consumers can start shopping the sale at 12:01 am CT at Kohls.com and in store at 5 pm. Doorbusters include a Samsung 58-inch 4k smart TV for $549.99, just $24 for an Amazon Echo Dot 3rd Generation and $399.99 for a Canon EOS Rebel T6 DSLR camera with $120 Kohl’s Cash. In apparel, Kohl’s will offer $14.99 tops from Simply Vera Vera Wang, $7.99 for licensed character shirts and $8.99 for Tek Gear Fleece. In addition, the company will offer 60% off on a selection of baby clothing, 30% on several Lego products and a selection of toys for $17.99. Macy’s Macy’s will open from 5 pm on Thanksgiving Day to 2 am on Friday this year. Stores will re-open at 6 am and run doorbusters until 1 pm on Friday. The company will offer in-store only doorbusters that are free after rebate including a Bella Slowcooker, a Martha Stewart 4-pack Glassware Set, select tote bags and fashion watches. Macy’s has several in-store only deals for the Bella Electric Skillet, Tools of the Trade soup pot etc. Levi’s, DKNY and Calvin Klein will be offered at 30-50% off on select styles. Macy’s attached $10 and $20 off coupon on select in store items on the Black Friday Advertisement. In apparel, customers can purchase $199.99 designer suits from Michael Kors, Tommy Hilfiger etc. Juniors’ dresses and fine gauge sweaters will be available in store for only $9.99. With select mattress purchases, customers will get a free box spring. The company will also offer 65% off holiday ornaments and dinnerware. Free shipping is included for online purchase of $49 or more. Old Navy Old Navy will open at 3 pm on Thanksgiving Day. From November 15 to 20, the company will offer 40% off and card-member-only discounts of 50% off entire purchase. November 16-20, customers will get jeans, sleep, outwear, tees and sweaters for 50% off. November 21-23, Old Navy will offer 50% off customers’ entire purchase and over 1,000 styles for $5 for all customers, both in-store and online. On Black Friday, the company will sell $1 socks in store only. Oldnavy.com Source: Old Navy Target Target will open at 5 pm on Thanksgiving Day and close at 1 am Friday. Stores will re-open at 7 am on Friday. All TVs will be on sale and Target will sell Element 55-inch 4K Smart TVs for $199.99 in store on Thanksgiving Day. Other doorbusters include a Google Home Mini for $25, Amazon Echo Dot 3rd Generation for $24, Nintendo Switch Mario Kart 8 Deluxe for $299.99 and Powerbeats Wireless Neighborhood Collection for $89.99. Various products come with gift card promotions. Customers will get a free $250 Target Gift Card towards the purchase of an iPhone XS or iPhone XS Max and a $300 Target Gift Card for a Samsung Galaxy Note 9. Both require qualified activation on selected carriers and deals are valid from 7 am Friday to Sunday. In addition, a selection of games and puzzles will be 50% off. Walmart Walmart stores will open at 6 pm local time on Thanksgiving night. Online sales will start on Wednesday, November 21 at 10 pm EST. The company will sell products such as the iPhone 6 for $99 on selected service providers and the new Sony PS4 1TB Slim Spider-Man bundle for $199. In addition, customers can purchase a 40-inch 1080p TV for $99 and a 65-inch 4K Smart TV for $398. Walmart also offers a selection of toys for a fixed price of $5, $10, $15 etc. Walmart Black Friday Advertisement Source: Walmart Key Takeaways Early Black Friday deals are available on Amazon now with more scheduled to arrive November 16-23 and Old Navy has Black Friday creep as well. New tech and electronics will be traffic drivers for e-commerce and brick-and-mortar companies, with big screen smart TVs, iPhones, Amazon and Google smart products available at multiple retailers. Many retailers will open their doors Thanksgiving evening, and open early Friday with doorbusters for early risers. This document was generated for
Insight ReportOctober 2018 UK Retail Sales: Growth Softens in an Unusually Volatile October Coresight Research November 19, 2018 Executive SummaryCoresight Research’s monthly reports keep you up to date on US and UK retail sales, US retail traffic and in-store metrics, selected US retailers’ same-store sales and key global consumer indicators. Click here to view our full collection of Monthly Reports. Our monthly UK Retail Sales Report reviews the latest sector data published by the Office for National Statistics (ONS). Highlights from our October UK Retail Sales Report: Retail sales growth in the UK slowed in October as demand softened in a number of big-ticket sectors. Grocery retail sales growth softened as inflation eased. Large clothing retailers saw moderate sales growth in spite of unseasonable weather, but footwear retailers’ sales continued to decline. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportTen Days of Holiday Innovators, 2018: Day 2 – Okabashi Footwear Coresight Research November 19, 2018 Executive SummaryTo kick off the 2018 holiday shopping season, Coresight Research will feature daily profiles of 10 innovative companies that span health and wellness; apparel, footwear and accessories; and, beauty. Each of our Ten Days of Holiday Innovator profiles gives you a company overview, insight into what makes the company innovative, and the company’s recommended “must-have” gift for 2018. The 2018 holiday shopping season is expected to be a healthy one.US consumers are expected to spend an average of $1,007 this holiday season,1% more than they planned to spend last year, according to the National Retail Federation (NRF) annual holiday spending survey, conducted by Prosper Insights & Analytics. Okabashi is a Buford, Georgia-based footwear manufacturer specializing in designing and manufacturing comfortable shoes for both men and women founded in 1984.Okabashi is known for flip flops and sandals.The company markets via a network of retail stores as well as online to US and international customers.Being quintessentially American is a central theme in its brand messaging while wellness and reflexology are key tenets behind its products. The company’s sustainability efforts include closed-loop recycling to minimize environmental waste and shoes that are 100% recyclable. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportTakeaway from ReMode Day -1 Coresight Research November 19, 2018 Executive SummaryThe Coresight Research team attended the inaugural ReMode two-day conference in Los Angeles, November 13 and 14. ReMode is focused on disruption and sustainability in the fashion industry, helping the fashion industry navigate the new realities across the entire value chain of the fashion business via its four foundational pillars: ReThink, ReMake, ReInvest and ReMarket. Key takeaways from ReMode’s Day 1 include: Sustainability and ethics matter to consumers, notably millennials. Perfect is the enemy of progress: It will be iterative. Transparency is driving sustainable supply chains and brands. Sustainability Matters ReMode’s Founder, Pierre-Nicolas Hurstel, opened the conference with a commentary on the state of the fashion industry, new consumer attitudes and changing consumer expectations. According to Hurstel, 66% of millennials are willing to spend more for sustainable products and 90% would switch brands for a strong cause. We are at a critical moment with the opportunity to create sustainable purposeful brands, to scale innovation and transform the fashion industry with open collaboration. Real change necessitates collaboration across the industry from sourcing to retail shelf. The fashion industry will be 25% of the world’s carbon footprint by 2050 if we continue as is. Focused Iterative Improvement Leading to Scale Benefits Joey Zwillinger, Cofounder and co-CEO of Allbirds, talked about Allbirds’ mission: to make shoes in a better way, offering comfortable and durable products with great customer service while using sustainable sources. Zwillinger claims Allbirds has the lowest carbon footprint in the footwear industry and that footwear is ready for disruption with approximately 20 billion pairs of shoes manufactured annually that ultimately end up in a landfill. Pierre-Nicolas Hurstel, ReMode, Joey Zwillinger, Allbirds Source: Coresight Zwillinger’s advice to brands, “We tried to be absolutely 100% sustainable and it led to ugly products that didn’t last and were more expensive. Perfection is the enemy of good. Every day we try to get better.” In terms of product development, Allbirds started with wool, moved to eucalyptus fiber, and then collaborated with a Brazilian company and created a foam shoe sole, removing petroleum from the process and replacing it with sugars – resulting a carbon negative foam sole. Zwillinger touched on a repeated theme of Remode: industrywide collaboration to drive change, uniting commerce and sustainability. Allbirds opened its foam to the footwear industry and others, claiming altruism as well as the opportunity for improved financials as more users lowers costs. Big companies are calling. Scaled sustainability should ensue over time. Allbirds focuses less on product development and more on fewer products with greater impact. With its direct-to-consumer vertical model, Allbirds is taking profits typically reserved for retailers and investing it back in product quality at a lower price. Transparency and Sustainability We attended numerous sessions on sustainability. Michael Preysman, Founder and CEO of Everlane, built his business on garments designed to last, partnering with ethical factories and providing pricing transparency to consumers. The genesis of Everlane was anti-fast fashion and a revelation of how the fashion industry really worked seven years ago. “A t-shirt that cost $7 to make was priced at $50 at retail, it felt wrong” Preysman said during his fireside chat with Hurstel. Online, direct to consumer, Everlane could offer the garment for $15. A brand was born. But a sustainable supply chain isn’t as easy as pricing transparency. Picking the right factories and finding the right audit partners takes time. Preysman focuses on finding the right partners who are doing the right thing and pushing them forward. There are many incremental tasks that can change the sustainability of fashion, for instance, not using the plastic wrap that individually surrounds each article of clothing en route to the customers. At Everlane, taking control of the supply chain is a layer of incremental cost that they absorb, approximately 10%-15%. Materials haven’t been available in sustainable ways, but brands and retailers can push suppliers to offer sustainable options. When asked where will Everlane be in ten years, Preysman said “to be sustainable and purchase is cognitive dissonance. To buy nothing is the most sustainable thing you can do. Our future involves impacting design and the supply chain, educating consumers and driving change and awareness.” Building a Sustainable World begins with Academia Barak Cakmak, Dean of Fashion at the Parsons School of Design, addressed the role of academia in fashion’s evolving role in society. Parsons encourages students to acknowledge the importance of transparency and ethical, environmentally-friendly supply chains in fashion and understand key societal challenges. As a first step, all required courses incorporate relevant knowledge on sustainability and ethics as a new baseline for fashion design education. Sustainability has become a focus of Parsons’ projects in fashion and other institutions. In addition, Parsons now engages with all the players across the value chain, not just major fashion brands, and is building deep relationships with material suppliers, manufacturers, and other industry participants that align with Parsons core values. By bringing knowledge from local and global, small and large, traditional and technologically advanced partners, the college hopes to ensure a clear understanding of the diverse ecosystem in fashion and beyond. Today, Parsons has innovative partnerships with organizations such as AARP, United Nations, NGOs and even governments to explore the role of design for sustainable and ethical approaches to cultural and societal questions. This document was generated for
Insight ReportOlder Millennials Will Be Avid Social Media Users for Thanksgiving Weekend Shopping Inspiration Coresight Research November 19, 2018 Executive SummaryAn estimated 164 million people plan to shop Thanksgiving Day through Cyber Monday (“Thanksgiving weekend”), according to an annual survey released November 16 by the National Retail Federation (NRF) and Prosper Insights & Analytics. Black Friday will be the busiest day: Of those surveyed who said they will shop over the holiday weekend, 70.7% said they plan to shop on Black Friday, or an estimated 116 million people, followed by Small Business Saturday (41.3% of those who said they’ll shop over the weekend, or an estimated 67 million people). Cyber Monday is expected to see an estimated 75 million people shopping online (46.1% of those who said they plan to shop during Thanksgiving weekend). Some 21.2% of those who planto shop during Thanksgiving weekend (an estimated 34 million people) plan to shop on Thanksgiving Day, and 20.0% (32 million) on Sunday. Online search will be the greatest source of inspiration for gifts (47.3%), followed by friends and family (40.7%). US retailers are preparing for the biggest shopping weekend of the year, with an estimated 164 million people plan to shop Thanksgiving Day through Cyber Monday, according to the NRF/Prosper Insights & Analytics annual survey released November 16. Coresight Research is forecasting at least a 4% gain in 2018 holiday sales, with online sales growth expected to be in low to mid-double digits. Thanksgiving marks the official beginning of holiday shopping, though many shoppers began as early as last January to take advantage of 60%-80% off sales for holiday decorations. While January is too early for most, retailers acknowledge that the traditional calendar markers have blurred, and Christmas in July is a familiar promotion for many early shoppers. Base: US Internet users ages 18+ who plan to shop Thanksgiving weekend Source: Prosper Insight & Analytics/Coresight Research According to the NRF/Prosper Insights & Analytics survey of 7,516 consumers conducted October 29–November 7, 45.1% of consumers haven’t begun shopping for the holidays yet, and 2.7% are finished shopping. The gift that most (58.9% of those planning to shop) plan to give this year is clothing, followed by gift cards (56.4%), toys (40.8%) and media (40.1%). Black Friday will be the busiest day: 70.7% of those who said they plan to shop Thanksgiving weekend will shop on Black Friday, equating to an estimated 116 million people. This is followed by Small Business Saturday (41.3% of those planning to shop, or an estimated 67 million people), with Cyber Monday wrapping up the shopping weekend (46.1% of those planning to shop, an estimated 75 million people). Shops open Thanksgiving day will see shoppers, as 21.1% of those planning to shop will do so Thanksgiving Day. Shopping or Not? When asked if they are likely to go shopping this Thanksgiving weekend, either online or in stores, there was a 160-basis point (bps) jump in survey respondents who said yes, a 10 bps increase in those saying they will not shop during Thanksgiving weekend and a 170 bps drop in consumers who said they may shop. Source: Prosper Insight & Analytics/Coresight Research In terms of where consumers find inspiration, 47.3% of those surveyed said they will go online – the same as 2012. Some 40.7% of those surveyed will rely on friends and family, up slightly from 2012’s 40.4%. TV advertisements remain an important source of gifting inspiration for 27.7% of adults, down significantly from 2012’s 35.4%. Shoppers continue to find in-store inspiration as well, with 37.8% citing instore as a source of inspiration, down from 45.2% in 2012. Traditional Media Remains a Significant Source of Inspiration While social media has risen in terms of being a source of inspiration in the aggregate for adults, from 22.9% in 2012 to 37.5% in 2018. Facebook is down 320 bps year over year to 13.2% and virtually flat to 2012’s 13.3%. Instead, shoppers are looking more to Pinterest and Instagram: 10.3% of respondents say they will look to Pinterest, while 8.8% will look to Instagram. Source: Prosper Insight & Analytics/Coresight Research Surprisingly, a greater percentage of millennials, 29.6% of younger millennials aged 18–24 and 31.7% of older millennials, aged 25–34, find inspiration on TV. Some 41.8% of older millennials will use in-store experiences for inspiration, versus 39.5% of younger millennials and 37.8% of adults. Traditional media and advertising, such as store circulars, catalogs, direct mail and magazines, remain significant sources of gift giving inspiration. While 28.1% of the overall adult population will rely on advertising circulars, just 15.2% of older millennials (the 25–34 age group) will. In our Consumer Shopping Insights for Holiday 2018 report we note the older millennial plans to spend an average of $947 this holiday, versus $573 for younger millennials, and $1,007 for all adults. See Figure 3 for traditional media and intended use by adults generally, and younger and older millennials. Source: Prosper Insight & Analytics/Coresight Research New Media Outlets Will be Heavily Used by Older Millennials Older millennials plan to use social media as a source of inspiration, more than any other demographic. Instagram will be the greatest social media source of inspiration, with 25.1% of 25–34-year-old consumers expected to use Instagram. Facebook came in second place, with 22.9% of the 25–34 age group planning to use the platform to find inspiration for gifts. Figure 4 displays new media and its intended use by adults generally, and younger and older millennials. Source: Prosper Insight & Analytics/Coresight Research This document was generated for
Company Earnings UpdateNORDSTROM (JWN) 3Q18 Results: Company Misses Expectations and Raises Guidance Coresight Research November 19, 2018 Executive Summary Nordstrom reported 3Q18 revenues of $3.65 billion, up 3.0% year over year and below the consensus estimate of $3.7 billion.Diluted EPS was $0.67,flat compared to the year-ago quarter and $0.01 above the consensus estimate of $0.66. Comparable sales increased 2.3% in the quarter compared with the year-ago quarter and above the consensus estimate of 2.2%. By category, full price increased 0.4%, below the consensus estimate of 1.6%while off price increased 5.8%, ahead of the consensus estimate of 2.5%. Nordstromraised its full-year earnings guidance per share and now expects adjusted EPS of$3.55–$3.65, in line with the consensus estimate of $3.61 and up from the previous guidance of $3.50–$3.65.For the full year, the company expectstotal net sales to be $15.5–$15.6 billion, an increase from prior guidance of $15.4–$15.5 billion. The consensus estimate is $15.91 billion. Comparable sales are expected to be 2%, up from the prior guidance of 1.5%–2.0%. Please Login to read the full report. Not a member? To access this content for free, register for a free account. This document was generated for
Store TrackerWeekly Store Openings and Closures Tracker 2018, Week 46: Sears Holdings to Shutter 40 More Stores Coresight Research November 16, 2018 Executive SummaryCoresight Research tracks store closures, openings and bankruptcies for a select group of retailers in the US and the UK. Our Weekly Store Tracker focuses on department stores and specialty retail stores, including, but not limited to, those selling softlines, hardlines, consumer electronics, groceries and furniture. Click here to view our full collection of Weekly US and UK Store Trackers. Highlights from this week’s Store Tracker: Year-to-date (YTD) 2018, the number of US store closure announcements stands at 5,468 and the number of store openings is 3, Sears Holdings has announced plans to shut 40 US stores. YTD in the UK, there have been 1,394 store closure announcements and 783 store opening announcements. House of Fraser may see further store closures. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Company Earnings UpdateWalmart (WMT) 3Q19 Results: Beats on Comps and EPS, Misses on Revenues; Raises EPS Guidance Coresight Research November 16, 2018 Executive Summary Walmart reported 3Q19 adjusted EPS of $1.08, up 8.0% from $1.00 in the year-ago quarter and beating the $1.01 consensus estimate. Total revenues were $124.9 billion, up 1.4% year over year but below the consensus estimate of $125.4 billion. US comp sales increased by 3.4%, ahead of the 3.1% consensus estimate, on a 1.2% increase in traffic and a 2.2% increase in ticket. E-commerce growth accelerated to 43%. Walmart raised 2019 adjusted EPS guidance to $4.75–$4.85 from $4.65–$4.80 and raised comp guidance to at least 3% from “about 3%.” Please Login to read the full report. Not a member? To access this content for free, register for a free account. This document was generated for
Insight ReportTencent (0700.HK) 3Q18 Results: Solid Revenue Growth Despite Slowdown in Gaming Coresight Research November 16, 2018 Executive Summary Tencent reported 3Q18 revenues of ¥80.6 billion ($11.7 billion), up 24% year over year. Non-GAAP diluted EPS was ¥2.06, an increase of 15% year over year. The results were largely driven by strong growth from online advertising and payment-related and cloud services. Value-added services (VAS) revenues, which accounted for 55% of total revenues, increased 4.6% year over year. The increase was slower due to poor performance in online games revenues, especially PC client games. Online advertising revenues were up 47% year over year to ¥16.2 billion, reflecting more advertising inventories for Weixin and new advertising formats, such as Mini Programs. Source: Company reports/Coresight Research 3Q18 Results Tencent reported total revenues for 3Q18 of ¥80.6 billion ($11.7 billion), up 24% year over year. The gross margin decreased by 456 basis points to 44% from a year ago due to increased spending. Non-GAAP diluted EPS was ¥2.06, up 15% year over year. Below, we outline the performance of VAS, online advertising and other segments. Value-added services (VAS): Revenues were ¥44.0 billion for the quarter, up 4.6% year over year, comprising 55% of total revenues. Within VAS, online game revenues decreased 4% year over year to ¥25.8 billion, mainly due to a decline in revenues from PC client games. Revenues from PC games were down by 15% year over year to ¥12.4 billion. Social network revenues increased 19% year over year to ¥18.2 billion, driven mainly by digital content services such as video streaming subscriptions and live broadcast services. Online advertising: Revenues for this segment were ¥16.2 billion for the quarter, up 47% year over year, accounting for 20% of total revenues. Social and other advertising revenues increased 61% year over year to ¥11.2 billion, reflecting more advertising inventories for properties such as Weixin Moments and new advertising formats such as Mini Programs, as well as growth in revenues from the mobile advertising network and QQ KanDian. Media advertising revenues increased 23% year over year to ¥5.1 billion, primarily due to growth in revenues from Tencent Video due to a successful drama series and self-commissioned variety shows. Others: Revenue for the others segment was ¥20.3 billion, up 69% year over year, reflecting revenue growth from payment-related and cloud services. Performance of Operating Drivers Source: Company reports/Coresight Research Combined monthly active users (MAU) of Weixin and WeChat rose 10.5% year over year. Thanks to the fast growth of Mini Programs and Weixin Pay use cases, user engagement and stickiness have shown healthy growth. User activity within Weixin and We Chat benefited from strong growth in social video content viewing, with hundreds of millions of daily social video uploads. Outlook The company reorganized to help enterprises and various industries to ride on the new trend of industrial Internet through digitization and technology innovation, and to provide consumers with better integrated entertainment and social experiences to position for future long-term growth. Management did not provide updates on revenue guidance. This document was generated for
