NEW YORK (MarketWatch) — U.S. retailers posted their best October sales in more than a year, with sales up 2.2%, with discounters and department stores leading better-than-expected gains while teen retailers struggled.
The numbers, tracked by Retail Metrics, showed retailers’ best month since April 2008 and compare to a 3.5% decline in October 2008, when the start of the financial crisis sent consumer spending into a nosedive.
Gap Inc. /quotes/comstock/13*!gps/quotes/nls/gps (GPS 23.03, +0.94, +4.23%) , helped by its discount Old Navy chain, led a better-than-expected 5.9% increase in the specialty apparel group, Retail Metrics data showed.
Discount group sales were up 2.3%, led by upside at Costco Wholesale Corp. /quotes/comstock/15*!cost/quotes/nls/cost (COST 58.87, +0.06, +0.10%) . Department store group’s decline was smaller than expected, after a surprise and better-than-expected gain each from luxury retailers Saks Inc. /quotes/comstock/13*!sks/quotes/nls/sks (SKS 5.68, +0.11, +1.98%) and Nordstrom Inc. /quotes/comstock/13*!jwn/quotes/nls/jwn (JWN 33.16, +0.56, +1.70%) .
Teen retailers declined a worse-than-expected 4.7%, after disappointments in retailers from Aeropostale Inc. to American Eagle Outfitters Inc. Aeropostale Inc. /quotes/comstock/13*!aro/quotes/nls/aro (ARO 32.63, -5.40, -14.20%) and American Eagle Outfitters Inc. /quotes/comstock/13*!aeo/quotes/nls/aeo (AEO 15.82, -2.04, -11.42%) were each down 13% and 11% in late morning trading. American Eagle’s third-quarter outlook also missed. Aeropostale Inc. sales rose 3%, missing estimates of a 14% jump even as it raised its third-quarter outlook.
“It’s not a universal turnaround,” said John Long, a retail strategist at consultant Kurt Salmon Associates. “Caution is still in the air. Consumers are still being selective.”
]]>By George Anderson
The Walt Disney Company, with an assist from Steve Jobs and Apple’s retail operations group, is undertaking a major remodeling effort at its 340 Disney Store locations in the U.S. and Europe. The plan is to take some of excitement of the Magic Kingdom and transplant it into the store environment. The new concept is called Imagination Park.
“The world does not need another place to sell Disney merchandise – this only works if it’s an experience,” Jim Fielding, president of Disney Stores Worldwide, told The New York Times.
“The Disney stores were like museums that were all gift shop without the experience of the museum,” Richard Bates, chief creative officer at The Brand Union, told Brandweek. “Your goal is to immerse them in the brands so that, they aren’t just coming into the store, they want to buy so they can have a piece of that experience.”
Disney plans to spend about $1 million per store to create the new experience that makes use of interactive technology and entertainment to draw shoppers into locations and keep them there.
Kids will be able to choose film clips to watch in in-store theaters. They’ll also take part in karaoke contests or chat live via satellite with stars from shows running on the Disney Network. Computer chips embedded in packaging will activate hidden features.
Mr. Jobs, who serves on the Disney board, is said to have encouraged the company to “think bigger” when it came to the remodels. Disney was given access to proprietary information about Apple’s retail operations as it worked to create Imagination Park.
A piece of advice that Mr. Jobs offered and Disney followed was to build a prototype. The store located in Glendale, Calif., impressed Bruce Tobin, executive vice president with Simon Property Group.
“It’s truly spectacular – beyond our imagination,” Mr. Tobin told the Times. “These are going to be true destinations.”
Discussion Questions: Is Disney on the right track with the Imagination Park concept? What do you think of the role of Steve Jobs and Apple in the concept’s development? Will we see more Apple-like environments in retail going forward?
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