Retailers Have Sky-High Expectations for Black Friday. Will Shoppers Show Up? | The Week Ahead, BoF Professional

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Retailers Have Sky-High Expectations for Black Friday. Will Shoppers Show Up? | The Week Ahead, BoF Professional

A Banner Black Friday

  • As the economy recovers from the pandemic, retailers expect strong holiday sales.

  • Some shoppers started shopping early amid warnings about supply chain snarls, which could delay holiday shipment.

  • Prices are rising, particularly on essentials such as gasoline, though so far that hasn’t deterred spending on consumer goods

  • People are almost nostalgic for Black Fridays past, when families gathered around the fire place to watch viral footage of shoppers grabbing the last flatscreen TV at a deeply discounted price. Shopping malls, big box stores, and department stores are reporting record foot traffic. They also expect record spending this long Thanksgiving weekend. The economy is booming. Some Christmas-themed stores have been able to replace family gatherings that were missed last year. “revenge shopping”There is no doubt that inflation is a factor. Rising inflation and problems with global shipping means that shoppers have to spend more to buy the same items. Salesforce found that online retailers offer 16 per cent fewer discounts and 12 per cent higher prices. Shoppers are also starting their spending earlier than they used to: respondents to a National Retail Federation survey said they’d completed 28 percent of their holiday shopping by early November, compared with 18 percent a decade ago. But despite dire warnings of shipping delays, shortages and fewer promotions this year, there’s been no mass movement away from the last-minute hunt for the perfect gift.

    The bottom line: This holiday season will have a significant impact on how retailers continue to operate in the new year. Strong sales would indicate a longer period with tight inventories and higher profit margins. An underwhelming season could lead to the industry returning to its pre-pandemic routine of year-round discounts.

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    Turnaround Takeaways

  • Gap Inc. and American Eagle Outfitters report quarterly results this Week

  • Each of these brands has made significant changes to their businesses in the past few years to achieve varying degrees success.

  • Abercrombie is the furthest along in recapturing its ‘00s glory, as detailed in BoF’A case study from a recent project

  • Some of America’s biggest mallThis week’s earnings reports come just before the holiday season, which could have a significant impact on future prospects for brands. Gap Inc. is the company with the most to show, coming off a strong run that saw sales rise at its flagship brand and first Yeezy products being released. There are still many questions, including about Banana Republic’s state. Ana Andjelic, chief brand officer, resigned months after revealing her vision for the label’s revival. American Eagle is now on a firmer footing as its Aerie lingerie and main brand continue to grow. As e-commerce plays an increasingly important role, a pair of recent logistics acquisitions will help to strengthen the backend.

    Despite this, executives at these companies wish they had worked at Abercrombie & Fitch. The brand has executed a turnaround that jettisoned its problematic early ‘00s vibe and reversed years of slumping sales. The brand has earned a reputation for selling quality, stylish clothes that are more expensive than its competitors. mall. The shares are close to an 8-year high.

    The Bottom Line: Success for these companies means adapting what’s good about their brands to new challenges, whether it’s a high-profile collaboration, a new category or a top-to-bottom revamp.

    An Unusual Marketing Opportunity

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  • House of Gucci is in theatres this week in the UK and USA

  • The public has not been involved with the film by Kering’s brand.

  • The stylish trailer, and Lady Gaga’s press appearances, have nevertheless brought attention to the film and the Gucci brand

  • A movie starring Lady Gaga in high-profile would be a huge success for many brands. For a luxury megabrand like Gucci, it’s a bit of a mixed bag. House of Gucci recaps a dark chapter in the brand’s history, an intra-family fight for control of the company that ended in murder. To most Gucci fans, it will be an ancient, stylish history. The family’s involvement with the brand bearing its name ended in the early 1990s; today it’s owned by Kering, a discreet (compared with the ‘80s-era Gucci clan, at least) luxury conglomerate.

    Kering hasn’t engaged much with the movie publicly, though the inclusion in the cast of Jared Leto, an Alessandro Michele muse, and Salma Hayek, wife of Kering chief executive François-Henri Pinault, is perhaps a tacit signal of approval. Luxury brands prefer to stage their moments in the spotlight carefully, so the label is currently promoting its products. “hacker project” with Balenciaga, which is hitting stores around the same time of the film’s release.

    The Bottom Line: Kering seems to be more comfortable with House of Gucci’s promotion value as buzz has increased (though the fashionThe film has been well received, and early talk about its merits was positive There has been more mixed results). The brand has also been dressing its stars for premieres around world in recent weeks. Gucci could benefit from the timing, as it needs to increase growth in a critical quarter for growth.

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