Tag Archives: Target

Foot traffic is declining and Black Friday can be much bigger than Cyber Monday in online sales

You have to wake up before it is too late. Black Friday is not what is used to be. Only a few years ago retailers were crowded with crazy people looking for a great deal. People still get great deals but some of them have already changed their behaviour.

According to Shoppertrak, foot traffic to U.S stores has fallen each year on Black Friday. We can clearly see a shift in the market, and reasons are many.

 

 

You can see it happening right in front of your eyes. Right now. Retailers are struggling and I have talked about if for years. Worst of all; this is just the beginning, and it is understandable. It is a natural thing.

Retailer chains said they will close about 7,000 stores and many of them are filing for bankruptcy. Many of them have too much debt and too many shops in the chain. On top of that we know that consumers wants to buy online.

Online retail activity are ten times bigger today than it was in 2004, and last year, on-line sales on Black Friday was around $2 billion, according to ComScore. Salesforce predicts Black Friday will be much bigger than Cyber Monday in online sales.

I take all the research on Black Friday as a pinch of salt, because retailers are destroying the day by starting the sale a week before the big day. Some call it Black Week, some call it Black Weekend and that will weaken the most important day Black Friday. That too makes the measure of the day a bit wrong. Black Friday is not only on Friday but sometimes for a whole week.

So, if you missed out on your shopping on Black Friday you still have the change to make a great deal on Cyber Monday.

The deals have already started and you can now buy for a discounted price at stores like Walmart, Amazon, Best Buy or Target. Cyber Monday is the online equivalent to Black Friday and the start is early on Monday November 27, 2017.

This is the day you can get deep discounts on Samsung, LG, Sharp, HP and Dell. You can also get a cheap PS4 slim and Xbox One S, Nintendo and iPhone X to name a few. It remains to see Cyber Monday exceeds Black Friday in on-line sales.

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Do you know the Target?

Last week I wrote about the biggest U.S retailer Wal-Mart. While the stock market had a terrible start of the year, Wal-Mart went in the opposite direction. What about the second largest discount retailer Target? The stock have so fare in 2016 been flat.

Target is over 100 years old, founded by Goodfellow Dry Goods in 1902, but the first Target store was opened in 1962. A lot of things have changed since then. Target operates 1,801 locations throughout the U.S.

Their retail formats include the discount store Target, the hypermarket SuperTarget, and small-format stores previously named City Target and TargetExpress before being consolidated under the Target branding.

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A lot of retailers will come out with reports this week, and Target is one of them. They will report on February 24, before the open.

Estimize is looking for EPS of $1,54 and revenue of $21.896 billion, in-line with Wall Street on the bottom line, and around $35 million greater  on the top-line. Target is projecting relatively flat earnings growth compared to the same period last year.

Target has gone online long time ago, and they had a record online traffic during the recent holiday shopping season. Amazon is the king in online-shopping and Target has a long way to go to come up to Amazon`s level.

Last quarter, digital channel sales surged 20% while also adding to comp store sales growth.

Target have a lot of job to do at handling massive inflows, and days like Cyber Monday, Black Friday and the holiday season are leaving many consumers frustrated. The company have made strategic hires combined with a renewed focus on higher-margin apparel.

Compared to Wal-Mart, Target generate above-average margins which is higher than their biggest rival Wal-Mart. The reason for that is Target`s higher –margin segments like home goods which accounts for about 36%. Wal-Mart generates only 14% in that segment.

Consumer prices in the U.S went up 1,4% YoY in January of 2016, following a 0,7% increase in the previous month. The inflation rate accelerated for the fourth straight month, but the U.S food inflation has dropped sharply last 12 months. From 3% last year to only 0,8 in January 2016.

Target hope to reach their goal in 2016 with a new and fresh leadership at the top. One of their goals is to make a multi-channel approach, which means they are looking for customers who shop in more than one channel at a time.

Their smaller-format stores will be 50% smaller than the typical 130,000-square-foot stores. Target`s urban locations will be about 45,000 square feet in size, and the reason for that strategic change is that the productivity levels are double those of traditional stores, and those stores will come in busy city centers.

Target recently sold its pharmacy business to CVS in a deal worth $1,9 billion, and in the next 6 to 8 months all 1672 Target pharmacies will be rebrand to read CVS, operating through a store within a store format.

This partnership is expected to serve as a compliment to the customer experience which will help drive higher traffic. The company is also focusing on the development of smaller format stores to penetrate urban and metropolitan areas.

In addition; Target has eliminated over 3000 stores and corporate employees in the U.S, estimated to save the company $2 billion.

All the changes makes Target`s future bright and I assume the new employees know the new target.

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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Amazon will advertise on Super Bowl

Another Wall Street darling is set to report after the closing bell today. A company we talked about nearly every day in the late 90`s. A company that survived the dot-com bubble. A company that is up 33,000% since then and up about 90% last year.

Amazon has become a big competitor to Wal-Mart and Target and it is expected to see that trend to continue. Amazon Prime`s subscriptions have doubled in two years and they offer users free two-day shipping, cloud storage and streaming.

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The Estimize Mean consensus calls for EPS of $1,64, three cents above the Wall Street estimate. Revenue expectations for $35,9B in-line with the Street`s consensus, and higher than guidance of $35,13B. Sales are expected to rise about 20% YoY.

I expect to hear more about their cloud computing platform which has become a new business segment in the company. Amazon Web Services (AWS), accounts for about 8% of total revenue, and the business is growing.

So are Prime time, which is a strong loyalty program for Amazons customers. They have free shipping and have the ability to stream and listen to  music  in the same package. Its been proved that loyal customers at Amazon Prime shop twice or more per month than non-subscribers.

Amazon said they added 3 million Prime subscribers before christmas day last year, and it isnt slowing. If this continue, Amazon will end up having 50% of all U.S hoseholds subscribed to Prime in 2020, according to Macquarie Research. Thats awesome.

Amazon hired a record 10,000 people in Europe in 2015 which is taking its workforce above 41,000. This will continue, and Amazon is stepping up its investment plans in Europe this year. In 2016, they plan to hire more staff as it seeks to expand amid a stricter scrutiny of its tax, privacy and employment records.

Amazon is also planning to advertise during this years Super Bowl for the first time. An ad by «30 Rock» star <strong>Alec Baldwin</strong> and former National Football League quarterback <strong>Dan Marino</strong>. The ad will highlight Amazons Echo speaker and its voice-activated virtual assistant Alexa. What do you think will happen the day after that ad? The sales will skyrocket.

What`s peculiar about Amazon is the price earnings at 831,80! Wow!

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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