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Why Are Wal-Mart and Target Next-Door Neighbors?

October 21, 2014 Comments off

Why Are Wal-Mart and Target Next-Door Neighbors? (PDF)
Source: Federal Reserve Board

One of the most notable changes in the U.S. retail market over the past twenty years has been the rise of Big Box stores, retail chains characterized by physically large stores selling a wide range of consumer goods at discount prices. A growing literature has examined the impacts of Big Box stores on other retailers and consumers, but relatively little is known about how Big Box stores choose locations. Because Big Box stores offer highly standardized products and compete primarily on price, it is likely that they will seek to establish spatial monopolies, far from competitor stores. In this paper, I examine where new Big Box stores locate with respect to three types of existing establishments: own-firm stores, other retailers in the same product space (competitors), and retailers in other product spaces (complements). Results indicate that new Big Box stores tend to avoid existing own-firm stores and locate near complementary Big Box stores. However, there is little evidence that new Big Boxes avoid competitors. Firms in the same product space may not be perfect substitutes, or firms may prefer to share consumers in a desirable location rather than cede the entire market to competitor firms.

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National Retail Federation — Halloween Headquarters

October 15, 2014 Comments off

Halloween Headquarters
Source: National Retail Federation

Halloween will be celebrated in record numbers in 2014, with more than two-thirds of Americans buying Halloween costumes this year. Total spending for the holiday on costumes, decorations, candy and more is estimated at $7.4 billion.

See also: Spook-tacular Halloween Sales Expected This Year (IBISWorld)

U.S. Consumers Plan to Increase Holiday Spending This Year, Supported by Greater Optimism about Personal Finances, Accenture Study Finds

October 13, 2014 Comments off

U.S. Consumers Plan to Increase Holiday Spending This Year, Supported by Greater Optimism about Personal Finances, Accenture Study Finds
Source: Accenture

Amid signs of increased optimism about their personal finances, one-quarter (25 percent) of U.S. consumers plans to spend more on holiday shopping this year compared to 20 percent in 2013, and spending on holiday gifts is expected to average $718, according to Accenture’s (NYSE:ACN) annual holiday shopping survey.

The survey also found consumer enthusiasm for Black Friday shopping has reached its highest level in eight years. Two-thirds of respondents (66 percent) said they are likely to shop on Black Friday, compared to 55 percent who planned to do so in 2013 and 44 percent who said the same back in 2007. In addition, 37 percent plan to shop online during that period using a desktop, mobile device or tablet, which is up from 32 percent in 2013. Plans to shop on Thanksgiving Day and evening rose to 45 percent from 38 percent in 2013. Of those consumers planning to shop on the holiday, 47 percent said that they will be shopping in a physical store between 6 PM Thanksgiving Day and 5 AM on Black Friday.

See also: Optimism shines as national retail federation forecasts holiday sales to increase 4.1% (National Retail Federation)

Disney’s Frozen Characters, Teenage Mutant Ninja Turtles Top Children’s Costume List

October 9, 2014 Comments off

Disney’s Frozen Characters, Teenage Mutant Ninja Turtles Top Children’s Costume List
Source: National Retail Federation

Having taken the world by storm this year, Disney’s Frozen and Teenage Mutant Ninja Turtle characters will again come to life this Halloween. According to NRF’s 2014 Halloween Consumer Top Costumes Survey conducted by Prosper Insights & Analytics, an estimated 2.6 million children plan to dress up as one of Disney’s Frozen characters, while about 1.8 million children will dress as one of the re-imagined classic characters from Teenage Mutant Ninja Turtles. Princess (3.4 million), animal (3 million), and Spider-Man (2.6 million) will be other popular choices for children.

Trends in producer prices between e-commerce and brick-and-mortar retail trade establishments

September 25, 2014 Comments off

Trends in producer prices between e-commerce and brick-and-mortar retail trade establishments
Source: Bureau of Labor Statistics

Electronic retailing, or e-commerce, is becoming an increasingly important activity within the U.S. economy. As a component of the retail trade index within the Bureau of Labor Statistics Producer Price Index (PPI) program, the electronic retailing index measures changes in margins received by retailers who conduct sales transactions online.

In the first quarter of 2004, the incidence of retailers conducting electronic retailing was considered minor, making up only 2 percent of total U.S. retail sales. But from 2003 to 2006, electronic retail sales increased an average of 28 percent annually. Then, by the first quarter of 2014, e-commerce grew to about 6 percent of total retail sales in the United States. Between 2009 and 2014, e-commerce sales increased at an average annual rate of 16 percent, compared with a 5-percent growth rate in total retail sales.

This Beyond the Numbers article describes the electronic shopping and mail-order houses industry group within the North American Industry Classification System (NAICS) and compares the factors affecting changes in margins for brick-and-mortar establishments and e-commerce establishments. The article compares changes in margins between the two types of establishments for three specific stores: furniture, clothing, and electronics.

Health and Wellness in America: The Consumer Perspective

September 10, 2014 Comments off

Health and Wellness in America: The Consumer Perspective
Source: Nielsen

Health is trending in the U.S. From superfoods like kale to new exercise fads like yoga and CrossFit, healthy habits are on the tip of the American public’s tongue. So with health and wellness going mainstream, have people really changed their habits?

Consumers aspire to better health and healthier eating, but wanting and doing are two different things. More than one-third of American adults are still obese according to the Centers for Disease Control and Prevention. And half admit that healthy eating is a challenge, especially in the face of rising food costs.

Despite setbacks, however, the desire to achieve an improved quality of life is driving consumers to pursue specific health and wellness behaviors, such as consuming healthy foods or reading package labels. By identifying unmet consumer nutrient needs, finding foods that address consumers’ health concerns and understanding different consumer segments’ varied habits, retailers and manufacturers can help consumers overcome the obstacles they face when it comes to health and wellness and improve their lifestyles.

Enabling Physical Analytics in Retail Stores Using Smart Glasses

September 9, 2014 Comments off

Enabling Physical Analytics in Retail Stores Using Smart Glasses
Source: Microsoft Research

We consider the problem of tracking physical browsing by users in indoor spaces such as retail stores. Analogous to online browsing, where users choose to go to certain webpages, dwell on a subset of pages of interest to them, and click on links of interest while ignoring others, we can draw parallels in the physical setting, where a user might “walk” purposefully to a section of interest, “dwell” there for a while, “gaze” at specific items, and “reach out” for the ones that they wish to examine more closely and possibly purchase.

As our first contribution, we design techniques to track each of these elements of physical browsing using a combination of a first-person vision enabled by smart glasses, and inertial sensing using both the glasses and a smartphone. We address key challenges, including energy efficiency by using the less expensive inertial sensors. Second, during gazing, we present a method for identifying the item(s) within view that the user is likely to focus on based on measuring the orientation of the user’s head.

Finally, unlike in the online context, where every webpage is just a click away, proximity is important in the physical browsing setting. To enable the tracking of nearby items, even if outside the field of view, we use data gathered from smart-glasses-enabled users to infer the product layout using a novel technique called AutoLayout. Further, we show how such inferences made from a small population of smart-glasses-enabled users could aid in tracking the physical browsing by the many smartphone-only users.

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