Issue 1 2019

30 CORPORATE VISION / Issue 1 2019 , Although the high street has had a poor Christmas in terms of spending buyers have spent huge amounts online, a trend which should point the way for businesses and drive them online, as Staff Writer Hannah Stevenson investigates. High Street Suffers Poor Christmas Despite Strong Consumer Spending Christmas is always a key time for consum- ers, who spend the weeks leading up to the holiday purchas- ing presents and food, and the weeks following it buying discount- ed themed stock. It is usually one of the busiest times of year for the high street, but in a twist of fate physical shops have suffered poor results over the festive period, which online stores have seen a rise in traffic. The latest Business Growth Expert’s Like for Like Retail Sales Index shows that total retail sales remained static in December at 0%, the worst Christmas for the British retail industry in a decade. Despite heavy discounting, the Christmas spike in shopper ac- tivity that many bricks and mortar retailers have become reliant on failed to materialise. Business Growth Expert and Yomdel CEO, Andy Soloman, commented on the findings. “While many bricks and mortar retailers would have been hoping for a Christmas miracle and an uplift in consumer spend over December, this has failed to mate- rialise leaving many in a financially precarious position. “Of course, Brexit is curbing con- sumer appetite to an extent, but a far greater hurdle for the Great British high street is how to remain competitive against the value of online retail while being squeezed from the other end via a hike in business rates and an ever-in- creasing wage bill. “Now, more than ever, the retail sector needs to evaluate its con- sumer offering and how they inte- grate this with the changing face of the industry in order to create greater appeal, while streamlining operations and lowering over- heads through the implementation of technology. “Those that manage to do so will evolve and survive but unfor- tunately, 2019 is likely to bring further casualties as even our big high street names continue to struggle.” Additionally, Macy’s, Inc. one of the USA’s premier retailers and owner of approximately 690 de- partment stores under the name- plates Macy’s and Bloomingdale’s, and more than 180 specialty stores that include Bloomingdale’s The Outlet, Bluemercury, Macy’s Backstage and STORY, has re- ported lower than expected reve- nues over the festive season. Jeff Gennette, Chairman and Chief Executive Officer of Macy’s, Inc, explored how this has affected the company. “We delivered our second con- secutive year of positive holiday comparable sales, driven largely by the traction of our strategic initiatives: Backstage, Vendor Direct, Store Pickup, Loyalty and Growth50. We experienced another period of double-digit growth in our digital business and continued strength in the Growth50 stores. The holiday season began strong – particularly during Black Friday and the follow- ing Cyber Week, but weakened in the mid-December period and did not return to expected patterns until the week of Christmas. In the holiday period, we saw strong performance across a number of categories (fine jewelry, wom- en’s shoes, fragrance, dresses, outerwear, active and home). This sales growth was largely offset by: underperformance of other categories (women’s sportswear, seasonal sleepwear, fashion jewelry, fashion watches and cosmetics); temporary fulfillment challenges following the fire in our West Virginia distribution center; and underestimation of the impact of changes to our pre-Christmas earn & redeem promotional event.” “We are revising the guidance we provided in November and will continue to take the necessary steps in January to ensure a clean inventory position as we enter fiscal 2019,” Gennette continued. “Looking back at 2018, we met our goal of returning the company to growth. Our revised guidance is above the expectations we set at the start of the fiscal year, and we expect to deliver our fifth consecu- tive quarter of positive comparable sales, including ‘comping the comp’ of the 2017 holiday season. The North Star Strategy is gaining traction, and the entire organiza- tion is engaged and motivated to continue improving our perfor- mance in 2019.” Meanwhile, according to Mas- tercard SpendingPulse™, which provides insights into overall retail spending trends across all pay- ment types, including cash and check, holiday sales increased 5.1 percent to more than $850 billion this year – the strongest growth in the last six years. Online shopping also saw large gains of 19.1 per- cent compared to 2017. “From shopping aisles to online carts, consumer confidence translated into holiday cheer for retail,” said Steve Sadove, senior advisor for Mastercard and former CEO and Chairman of Saks Incor- porated. “By combining the right inventory with the right mix of on- line versus in-store, many retailers were able to give consumers what they wanted via the right shopping channels.”