The November retail picture is always overshadowed by the health of the business on the Thanksgiving holiday weekend, as the market analyzes the impact of the weekend on the potential health of the total holiday selling season. This year was no different, as the usual analysis of the full month boiled down to the day after Thanksgiving and what that day portends for the whole season.
As Sports Executive Weekly reported last week (SEW_0548), the day after Thanksgiving, or what has been generally referred to as Black Friday, will most likely have less overall impact on the entire Holiday selling season than it traditionally has over the years. That assumption is based on the fact that Internet sales and gift cards, coupled with a very well-informed consumer and an extra Saturday to shop this year, will push more retail dollars through non-traditional channels and later into the retail year.
As we look at the month of November, there is little doubt about the impact a very promotional Thanksgiving weekend had on the numbers for the month. The biggest guys promoted the heaviest with some of the deepest discounts on key loss leaders than we have seen in some time. The impact on the month and the early part of the Holiday selling season was a shift in how retail fared compared to last year and more recent months. For the first time in more than a year, the luxury retailers were actually at the lower end of the overall 3.5% increase in comparable store sales for the month. That overall comp for November, as estimated by the International Council of Shopping Centers based on their survey of 65 chain stores, was a marked improvement over the 1.8% increase the market experienced last year.
While most were referring to the month as a mixed bag of results, it was also clear that, based on analysis of the most recent SportScanINFO numbers for last week and the month of November, weather played a major role in the health of the retail results for the period. We only have to think back to last year when the family footwear guys were struggling from slow boot sales and outerwear was starting to back up at the full-line sporting goods stores.
Winter arrived in early spring last year for many (except California and the Rockies) and led to a great deal of markdowns in December and January. This year, we had the Upper Midwest plunging into the teens already, while the Northeast and Midwest have already been forced to deal with decent lake effect snowfalls. Members of the SEW/BOSS editorial staff were already snowboarding in the North Carolina mountains, albeit in VERY ugly conditions.
This is not to say that promotions werent responsible for some of the sales growth during the month. They certainly had an impact on a number of brands, particularly in the running category, where Nike was knocked from their perch on the top rung last week, replaced by another brand that saw average selling prices decline sharply on its key technical product.
According to data released by SportScanINFO last week, the Thanksgiving week saw a strong jump in outdoor footwear, outerwear, and snow sports hardgoods, thanks to the turn to colder weather in late October that carried over into November.
The footwear category winners for Thanksgiving week appeared to be boots and running shoes. Timberland (#5), Merrell (#7) and Columbia (#10) all had a good week and appeared in the industrys Top 10 vendors in overall share for the week. Outdoor footwear sales were up nearly 32% for the week, driven by a 45% increase in the mid-market channel and a 75% jump in the family footwear and sport specialty channels. Full-line sporting goods sales of outdoor footwear rose more than 19%, according to the SportScanINFO data.
For the month of November, the outdoor footwear category, which also includes work boots and military/duty product, posted a 42% increase in sales versus the comparable period last year. Most of the gains came from increases in the mid-market department store, family footwear, and sport specialty channels, which includes the outdoor specialty business. The mall specialty channel posted a decline as the category loses momentum as a fashion product in the urban markets. The running footwear category also generated strong sales last week although a portion of the success was due to some promotional activity on outdated colors of key styles. Even though Nike still had five of last weeks Top 10 footwear dollar generators for the entire industry, it was a little rare to see as many non-Nike styles at the top of last weeks Best Sellers. Asics had four different models in last weeks Top 10 along with the Adidas T-Mac 5. Timberland had some representation in last weeks Top 20.
Nowhere was the impact of the weather felt more than in the outerwear category, which saw sales more than double for the month compared to last year, while sales for the last week of the month grew more than 150% versus the year-ago week. The category was probably the biggest disappointment in the retail fourth quarter last year, so this nice start should bode well for both retailers and potential vendor re-orders. The total numbers were driven by the gains in the full-line sporting goods channel, which closely mirrored the overall gain. Internet sales in the outerwear category were up nearly 150% for both the month and the week.
SSI reported its usual jump in the purchase of exercise and fitness equipment for the Holiday season. While the category was running down in the low single digits for much of the year, the Exercise equipment category jumped up almost 16% ahead of the same week last year. This trend may bode well for the total category this holiday season. Much of this increase is coming from the portable and handheld category as it was up 38.5% for the week versus last year.
Michael Niemira, chief economist and director of research for ICSC, said that November sales were in line with their projections, but “the strength was largely driven by promotions and did not provide as strong of a start to the holiday season as some retailers would have liked.”
Niemira said that December retail sales are now that much more critical to the overall success for the holiday season and the industry.
Family Footwear stores led all channels during the month, climbing 10.5% for November, thanks to strong performances at Shoe Carnival and Payless ShoeSource, a sharp reversal of fortunes from the 1.2% decline posted in November last year.
Shoe Carnival saw more of the same of its recent strength as womens dress shoes and boots and increased traffic drive the sales increase for November. Total sales increased 15.2% to $52.0 million from sales of $45.2 million for the same month in 2004. Comparable store sales increased 12.8% in November, compared to a 1.7% comp sales decline in the year-ago period. SCVL said that womens comps were up in the mid-20s for the month and mens was up in the mid-teens. Childrens, which also includes the kids athletic business, was up in mid-singles for the period. Mens and womens athletic was up in mid-single-digits. Total footwear comps were up 13.4% for the month, while accessories rose in mid-single-digits for November.
DSW reported net sales of $97.9 million for November, a 24.3% jump from net sales of $78.8 million in the year-ago month. November comparable store sales increased 12.8% over the same period last year.
Payless ShoeSource reported that same-store sales increased 9.0% in November, compared to a 2.3% decline in the year-ago period. Total company sales rose 5.4% to $207.6 million.
Zumiez delivered another double-digit increase in comparable store sales for November, up 18.8% for the month on top of a 1.8% gain in the same month last year. Total sales were up 38.6% to $18.0 million. ZUMZ management said that sales growth was driven by new stores, an increase in comp transactions, and an increase in average unit retail. The mens business was the strongest positive contributor for the month.
All other departments had positive comps.
Pacific Sunwear saw its d.e.m.o. format take center stage in November as the urban format posted a 4.9% comp store sales increase for the month, while the PacSun surf/skate lifestyle format stores posted a 2.7% comp sales gain for the period. Total company comps were up 3.0% for November and total company sales increased 12.1% to $107.3 million from total sales of $95.7 million in November last year. The average ticket per comp store was up in mid-singles, driven by a mid-single-digit gain in average unit retail and a low-single-digit increase in average units sold. Total transactions per store were down in low-singles.
The d.e.m.o. comp sales gain, which represented the strongest performance in nine months for the nameplate, was driven by continued strength in the girls business, which was up in the high-teens, offset a bit by a mid-single-digit decline in the guys business.
At PacSun, the guys business was up in mid-singles on a comp basis in November, driven by basic denim, track jackets, t-shirts, polos, and sneakers. Fleece and wovens were said to be weak. The girls business, which comped up in low-singles for the month, was driven by knit tops, short-sleeve ts, basic denim, and sweaters, offset a bit by weakness in fleece, wovens, and shoes.
Wholesale clubs climbed 6.1% overall, with Wal-Mart's Sam's Club increasing 7% and Costco posting a 6% gain, a solid increase from the 3.9% increase in November last year. Discount stores were up 3.1% this year, compared to a 1.0% gain last year for the same month. Department stores inched up 0.6%, with Neiman Marcus leading the pack, but the luxury stores overall were up just 2.0% for the month, compared to an average 6.7% gain for the YTD period and a 5.2% increase in November last year.
Niemira says he anticipates a same-store sales rise of 3.6% for December.
