Dive Brief:
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April retail sales at physical stores fell 3.6% year over year on a 6.5% decline in traffic, according to in-store analytics firm RetailNext. Conversion, average transaction value (ATV) and sales per shopper (SpS) all increased in April, according to the report.
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While sales did fall, it was the smallest rate of decline since December, credited in part to Easter falling in March this year—last year the holiday fell in April, so retailers were open an extra day in April 2016, according to RetailNext’s monthly report.
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“Overall, April showed signs of strength in that downward trends in sales and traffic were flattened out a bit,” Shelley E. Kohan, VP of retail consulting at RetailNext, told Retail Dive in an email. “Positive signs in April included strong ATV and Sales per Shopper, most likely the result of new spring merchandise and a merchandising refresh.”
Dive Insight:
RetailNext’s Kohan said that, combined with March, April’s in-store shopping trends reflect changing shopper preferences for more differentiated merchandise and the need for store associates to provide qualified assistance—what Kohan calls the “knowledge deficiency gap.” Retailers that fail to address these trends could drive their customers to those stores that do.
Retailers selling ready-to-wear and other apparel are particularly vulnerable to the problem of product “sameness,” Kohan said. Smaller retailers are breaking out of that pack, as “consumers seem to be showing a preference for niche, unique and differentiated product," she added.
"Going forward, collaborate marketplaces and the sharing economy will continue to challenge the traditional retail model," Kohan said. "There’s not a lot of product differentiation out there, and there are too few retailers deploying innovative strategies like exclusive collaborations with designers to break free from the pack. I see this as a problem that will continue to become more and more of an issue.”
That could explain the improved fortunes of teen apparel retailers American Eagle Outfitters and Abercrombie & Fitch, which have both abandoned the logo-centric clothing they'd been peddling for years in favor of higher quality, better designed apparel. American Eagle in particular has done well with its Aerie lingerie brand, a new focus on jeans with better fit, and the acquisition of designer Todd Snyder's labels.
By contrast, rival teen apparel chain Aeropostale lagged, and filed for bankruptcy protection earlier this month. Aeropostale also is closing more than 150 stores.
