It was a big week for some of retail’s biggest names.
Over the past few days, department stores Macy’s and Kohl’s, off-pricers TJX Companies and Ross Stores, multi-brand corporations Deckers and VF, big-box chains Walmart and Target, as well as footwear retailer Foot Locker were among those to report either fiscal first-quarter or full-year results.
Unsurprisingly, the majority of companies that shared quarterly numbers noted massive spikes in profits and sales — largely thanks to the government’s stimulus measure and expanding COVID-19 vaccine rollout. Pent-up demand also drove an increasing number of Americans, who turned to e-commerce last year as the outbreak kept them indoors, to return to and spend in stores.
Here, five trends to take away from this week’s financial reports.
Beats on fiscal stimulus and strategic initiatives
Among the greatest beneficiaries from fiscal aid appeared to be department stores like Macy’s and Kohl’s.
The chains posted stronger-than-anticipated financial results, with sales trends improving throughout the three-month period. In addition, both companies are currently executing on new strategic initiatives: While the former is in the midst of a three-year turnaround plan focused on digital investments, the latter is preparing for the launch of its shop-in-shop partnership with beauty giant Sephora.
“The wider department store sector is in the midst of a recovery, and the return is both welcome and exciting,” explained Placer.ai VP of marketing Ethan Chernofsky. “The initial visits spikes speak to the pent-up consumer demand and the unique brand equity these companies still carry with shoppers.”
Revamping brick and mortar
The COVID-19 pandemic has reshaped physical stores for good — so it’s no surprise some retailers are making moves to overhaul their brick-and-mortar portfolios.
This week, two companies either doubled down on or announced plans to reposition their fleets: Shoe Carnival shared that it was currently in the process of revamping its units. It intends to “modernize” roughly 100 outposts by May 2022, with the goal of remodeling two-thirds of its locations in the next three to five years.
And just today, Foot Locker announced that it would convert roughly a third of its Footaction stores into its existing banner concepts over the course of the year. It will permanently shut down the majority of remaining Footaction outposts as their leases expire over the next two years.
Big box is still big
As the health crisis drove panic-stricken shoppers to stores that carried basic necessities, let alone stayed open due to their “essential” status, retail’s titans emerged stronger than ever.
Their grip on consumers remains strong: For the first quarter, Walmart and Target surged past Wall Street’s predictions. While the Bentonville, Ark.-based company touted a spike in grocery sales and e-commerce, the Minneapolis-headquartered firm’s investments in its private-label brands and services like curbside pickup drove its revenues.
Athleisure continues to reign supreme
Even as the country continues to reopen, consumers are still turning to comfort and athletic apparel and footwear as well as outdoor gear.
At VF, brands including The North Face and Timberland collectively saw a 25% gain, while its active segment — counting Vans — rose 22%.
What’s more, Ugg — which continues to yield the bulk of revenues for Deckers Brands — logged a 53.1% jump in sales to $300.5 million, while Hoka One One recorded a 74.2% gain to $177.5 million.
Return to the treasure-hunt experience
The COVID-19 outbreak dealt a massive blow to off-pricers — many of which had limited or even no online presence, leading their comps to plummet as government-mandated restrictions kept their doors closed for weeks or even months during the prior year period.
Now, with reopened stores and increasing capacities, significant markdowns and the treasure-hunt experience at chains like TJ Maxx, Marshalls and Ross Stores — both of which delivered earnings and sales beats — are winning over shoppers once again.