TEEN CHOICES: When it comes to brand recognition in the sporting goods segment, Nike is the clear leader among teen consumers, according to a recent study by SportsOneSource. In the first teen edition of the Charlotte, N.C.-based company’s “Brand Strength Report,” surveyors found that shoppers ages 12 to 17 ranked Nike in the top spot in such areas as brand awareness and loyalty, and intent to repurchase. Adidas was next, followed closely by Under Armour, which, in the last two years, has made a significant push into the athletic footwear market. James Hartford, president, CEO and chief market analyst of SportsOneSource, noted that males were more aware of the Under Armour brand and more likely to repurchase it, but “teens across the board appear to connect with the Under Armour brand name.” Reebok took the No. 4 spot, and Puma, thanks to its strength with female shoppers, rounded out the top five. The survey also tracked shopping habits for sporting goods and found that “footwear is one of the more popular sporting goods purchases for teenagers.” Nearly 75 percent of respondents reported buying at least one new pair of athletic shoes every six months, and 30 percent of those surveyed purchase athletic shoes every three months. Performance running brands currently make up the largest part of the business, Hartford continued, but “skate is undeniably the fastest-growing category in the teen market.”
— JESSICA PALLAY
SHAREHOLDERS VS. SAKS: Two Saks Inc. shareholders — P. Schoenfeld Asset Management LLC and the New England Carpenters Pension Fund — won the first stage in their proxy fight with the retailer last week, as stockholders approved two nonbinding proposals to make Saks and its board more accountable to investors. At Saks’ annual meeting on June 3, shareholders approved proposals to declassify the company’s board and reduce directors’ terms, as well as change Saks’ plurality voting structure to a majority vote. At the meeting, Rob Davis, a P. Schoenfeld analyst, pressed his firm’s case, accusing Saks’ management of making missteps, which led to underperforming stock prices and below-average operating margins. “We believe this inferior performance is due to Saks’ presence in many undesirable locations, which … caused low sales productivity and led to unsatisfactory returns on investment,” said Davis. Saks Chairman and CEO Stephen Sadove told shareholders during the meeting that the company is reviewing stores with expiring leases and is committed to closing unprofitable ones. He also noted the company has cut $94 million in costs since last fall and predicted stabilization in business this year. The footwear business, he said, continues to remain weak. “Footwear and handbags had been standout growth businesses prior to the economy falling apart, but over the last several months, we’ve seen weaker performances out of those businesses.”
— KRISTI ELLIS
SOFT MAY SALES: Stores reported nearly universal declines in same-store sales for May, as the absence of last year’s stimulus checks and a lukewarm reaction to summer merchandise limited purchasing. The vacuum created by Wal-Mart Stores Inc.’s decision to discontinue participation in the monthly reporting put greater focus on Target Corp.’s results, which declined by 6.1 percent, versus the 4.3 percent slide estimated by analysts. There was no let-up in the pressure on department stores, particularly those at the upper end. Neiman Marcus Inc. and Saks Inc. reported comparable-store drops of 23.3 percent and 26.6 percent, respectively, while Nordstrom Inc. was off 13.1 percent. Macy’s Inc., Dillard’s Inc. and The Bon-Ton Stores Inc. reported declines of 9.1, 12 and 12.1 percent, respectively. However, Kohl’s Corp.’s 0.4 percent slip beat its internal projections, and J.C. Penney Co.’s 8.2 percent drop also beat its expectations. In contrast to the losses reported by the department stores, the nation’s two largest off-price retailers continued to reap rewards. The TJX Cos. was up 5 percent during the month, followed closely by Ross Stores Inc.’s 4 percent bounce.
— ARNOLD J. KARR