Toys/hobbies | Digital Commerce 360

Ecommerce earnings recap: What you missed from Crocs, Hasbro and more

Mary Meisenzahl — Mon, 19 Feb 2024 16:58:25 +0000

More retailers in Digital Commerce 360’s Top 1000 list of leading ecommerce retailers in North America reported ecommerce earnings results for the most recent fiscal quarter. Retailers reported mixed results across industries including apparel, toys and sporting goods. Here’s the ecommerce earnings summary you need to know from this quarter. Read more ecommerce earnings coverage here.

Parentheses indicate the merchant’s ranking in the Top 1000.

Amazon.com Inc. (No. 1)

Amazon beat expectations with earnings for its fiscal fourth quarter ended Dec. 31, 2023. Its net sales in the quarter grew 14% year over year to $170.0 billion.

Full-year sales grew 12% to $574.8 billion in 2023, up from $514.0 billion in 2022. Read more about Amazon’s earnings here.

Costco Wholesale Corp. (No. 6)

Costco said net sales grew 6.1% to $56.72 billion in its first fiscal quarter of 2024 ended Nov. 26, 2023. Ecommerce comparable sales grew 6.3% in the same period. E-gift cards, snacks and pet items were all strong in the ecommerce channel, the retailer said.

Crocs Inc. (No. 104)

Crocs reported that revenue grew 1.6% to $960 million in its fiscal fourth quarter ended Dec. 31. Direct-to-consumer sales, including ecommerce, grew 6.8%, while wholesale declined 4.6%. Revenue grew 11.5% to $3.96 billion for the full year.

CEO Andrew Rees says he expects personalization to be a major trend Crocs can capitalize on going forward. He pointed to Jibbitz sales, which grew 17% in 2023 to $250 million in sales.

Hanesbrands Inc. (No. 277)

Hanes reported net sales declined 12% to $1.3 billion in its fiscal fourth quarter ended Dec. 30. Activewear sales declined 24% in the quarter. For the full year, sales declined 9.6% to $5.6 billion.

“Our fourth-quarter performance did not meet our expectations as the sales environment proved to be more challenging than expected,” CEO Steve Bratspies said in a statement.

Hasbro Inc. (No. 555)

Hasbro said revenue declined 23% to $1.2 billion in its fiscal fourth quarter ended Dec. 31. Revenue declined 15% for the year to $5.0 billion. In both periods, digital gaming grew but was offset by declines in consumer products and entertainment segments. Hasbro attributed some of the entertainment segment decline to lower film and TV revenue from strikes in the entertainment industry in 2023.

“The consumer remains value conscious and we anticipate entertainment will be less of a tailwind in the year ahead, behind a reduced box office slate,” CEO Chris Cocks said.

Shopify Inc.

Shopify revenue and gross merchandise volume (GMV) both increased in the ecommerce platform provider’s Q4, which ended Dec. 31, 2023. Its revenue and GMV both increased for the full fiscal year, too.

45 retailers in the Top 1000 use Shopify as an ecommerce platform. Read more about Shopify’s earnings.

Target Corp. (No. 5)

Third-quarter sales declined 4.9% for the mass merchant, to $25 billion from $26.12 billion in its fiscal third quarter ended Oct. 28. Meanwhile, Target online sales decreased 6% year over year.

Moreover, Target’s online sales declined 6.7% year over year for the first nine months of its fiscal year. Read more about Target’s earnings here.

Walmart Inc. (No. 2)

Walmart reported that U.S. online sales grew 24% for its fiscal 2024 third quarter ended Oct. 27. Global ecommerce sales grew 15% over the same period, while international ecommerce declined 3%.

U.S. comparable sales grew 4.9%, and total revenue grew 5.2% to $160.8 billion. Read more about Walmart’s earnings here.

Yeti Holdings Inc. (No. 135)

Yeti reported sales increased 16% to $519.8 million in its fiscal fourth quarter ended Dec. 30. DTC sales grew 11%, and wholesale increased 26%.

Full-year sales grew 4% to $1.66 billion. Sales through Amazon were strong, the retailer said, although it did not participate in Amazon’s October Prime sales event.

“The channel continues to prove effective in reaching both new and existing customers on the platform,” CEO Matt Reintjes said. Amazon makes up about 25% of DTC sales, Yeti said. However, higher fees and freight costs negatively impacted margins, the retailer said.

So what does it mean?

Amazon has the power to make or break retailers that rely on online sales, as evidenced by Yeti. The retailer is feeling the pinch of higher fees, and it relies on the 25% of DTC sales that go through Amazon.
The toy industry remains challenged. Hasbro fared worse than competitor Mattel, which forecasted further industry declines in 2024.

Ecommerce earnings calendar

Here’s when other ecommerce earnings are scheduled to report this quarter:

Amazon.com Inc.: Feb. 1
Best Buy Co Inc.: Feb. 29.
Costco Wholesale Corp.: Dec. 14
The Home Depot Inc.: Feb. 20
Lowe’s Cos Inc.: Feb. 27
Target Corp.: March 5
Walmart Inc.: Feb. 20

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Ecommerce earnings recap: What you missed from Canada Goose, PetMed Express and more

Mary Meisenzahl — Fri, 09 Feb 2024 17:55:55 +0000

More retailers in Digital Commerce 360’s Top 1000 list of leading ecommerce retailers in North America reported ecommerce earnings results for the most recent fiscal quarter. Retailers reported mixed results across industries including apparel, pets and beauty. Here’s the ecommerce earnings summary you need to know from this quarter. Read more ecommerce earnings coverage here.

Parentheses indicate the merchant’s ranking in the Top 1000.

Amazon.com Inc. (No. 1)

Amazon beat expectations with earnings for its fiscal fourth quarter ended Dec. 31, 2023. Its net sales in the quarter grew 14% year over year to $170.0 billion.

Full-year sales grew 12% to $574.8 billion in 2023, up from $514.0 billion in 2022.

Read more about Amazon’s earnings here.

Alibaba Group

Alibaba’s revenue grew 5% to $36.67 billion in its third quarter ended Dec. 31.

Alibaba owns the world’s two largest online marketplaces by gross merchandise value (GMV), Taobao and Tmall. Taobao ranks No. 1 in the Global Online Marketplaces Database, Digital Commerce 360’s ranking of the largest such marketplaces by GMV. Tmall ranks No. 2. Taobao and Tmall grew their combined revenue 1% to $17.43 billion.

Bark (No. 186)

Bark reported revenue declined 6.9% to $125.1 million in its fiscal third quarter ended Dec. 31. Results were at the high end of Bark’s expectations. The retailer attributed the sales decline to fewer total orders due to a decrease in subscribers. Direct-to-consumer (DTC) sales, which make up the bulk of revenue, declined 7.6%. However, improvements to Bark’s website are driving increases in traffic and conversion, the retailer said.

Canada Goose (No. 218)

Canada Goose said total revenue grew 6% to $609.9 million in its fiscal third quarter ended Dec. 31. DTC revenue grew 14% due to growing in-store retail sales, partially offset by a decline in ecommerce. Wholesale sales, meanwhile, declined 28%. Canada Goose is evaluating its online product assortment to potentially make room for new categories going forward, said Jonathan Sinclair, chief financial officer.

The Container Store (No. 347)

The Container Store net sales declined 14.8% to $214.9 million in its fiscal third quarter ended Dec. 30. Online sales declined even more drastically, down 26.3% year over year. Website-generated sales, which include those designated for curbside pickup, declined 15.8%, accounting for 21.8% of net sales in the quarter. That’s flat with Q3 last year, the retailer said.

Costco Wholesale Corp. (No. 6)

E.l.f. Cosmetics Inc. (No. 951)

E.l.f. Reported it grew net sales 85% to $270.9 million in its fiscal third quarter ended Dec. 31. Online sales made up 24% of total revenue, compared to 18% in the year-ago period. Loyalty members are a driving force behind online sales growth, the retailer said, accounting for nearly 80% of online sales. The Beauty Squad loyalty program has 4.5 million members, and grew 30% year over year, e.l.f. said.

Estee Lauder (No. 43)

Estee Lauder reported net sales declined 7% to $4.28 billion in its second fiscal quarter ended Dec. 31. The retailer attributed much of the sales decline to waning demand in China. It will lay off 3% to 5% of its workforce in 2024.

Mattel (No. 205)

Mattel reported net sales grew 16% to $1.6 billion in its fiscal fourth quarter ended Dec. 31, while sales were flat for the year. Dolls, vehicles, games and building sets were the most successful categories, the retailer said.

“We expect the toy industry to decline in 2024, although at a lesser rate than 2023. The anticipated decline is due to a lighter toy theatrical film slate and the impact of the shift in consumer spending patterns towards experiences and services, which we believe will moderate over the year,” CEO Ynon Kreiz told investors.

PetMed Express Inc. (No. 354)

PetMed Express reported net sales for its fiscal third quarter ended Dec. 31 grew 11% year over year to $65.3 million. Recurring orders through the AutoShip & Save and PetPlus programs made up the majority of sales, accounting for 52.2% of revenue. That’s an increase from 42.3% of revenue in the year-ago period.

The retailer noted that pet food is a small but fast-growing part of the business. PetMed Express recently added the brand Hill’s Science Diet and has plans to pursue more premium pet food partnerships in the future.

Ralph Lauren (No. 78)

Ralph Lauren said revenue grew 6% to $1.9 billion in its fiscal third quarter ended Dec. 30. Global direct-to-consumer (DTC) same-store sales grew 9% over the same period. Gross profit was $1.3 billion, the retailer said.

Tapestry (No. 44)

Tapestry reported a 3% increase in net sales to $2.08 billion in its fiscal second quarter ended Dec. 30. Online sales grew in the single digits, the retailer said, making up one-third of total revenue. Direct-to-consumer revenue grew 4% over the period. Tapestry also opened a new fulfillment center in Las Vegas as part of a plan to grow omnichannel capabilities, the retailer said.

Target Corp. (No. 5)

Third-quarter sales declined 4.9% for the mass merchant, to $25 billion from $26.12 billion in its fiscal third quarter ended Oct. 28. Meanwhile, Target online sales decreased 6% year over year. Moreover, Target’s online sales declined 6.7% year over year for the first nine months of its fiscal year.

Read more about Target’s earnings here.

Under Armour Inc. (No. 97)

Under Armour reported 2% growth in ecommerce revenue during its fiscal 2024 third quarter, which ended Dec. 31, 2023. Total revenue declined 6% to $1.5 billion.

Walmart Inc. (No. 2)

Walmart reported that U.S. online sales grew 24% for its fiscal 2024 third quarter ended Oct. 27. Global ecommerce sales grew 15% over the same period, while international ecommerce declined 3%.

U.S. comparable sales grew 4.9%, and total revenue grew 5.2% to $160.8 billion.

Read more about Walmart’s earnings here.

The Walt Disney Company Ltd. (No. 100)

Disney said revenue for its fiscal first quarter ended Dec. 30 was flat from the year-ago period at $23.5 billion. DTC revenue, which includes the company’s streaming channels, grew 15% to $5.5 billion in the quarter. The DTC segment led to an operating loss of $138 million, but that’s a decrease of 86% from the loss in Q1 of 2023. The company said it projects streaming to become profitable in fiscal 2024.

So what does it mean?

The pet industry is subject to the same troubles facing other retailers. PetMed Express reported success with the same strategy that’s been successful for Chewy based on food and medications. Meanwhile, Bark felt a pullback in more discretionary pet items.
e.l.f.’s 85% sales growth on top of the 49% it grew in Q3 2023 shows that the cosmetics retailer isn’t slowing down as it gains name recognition and expands on social media platforms.

Ecommerce earnings calendar

Here’s when other ecommerce earnings are scheduled to report this quarter:

Amazon.com Inc.: Feb. 1
Best Buy Co Inc.: Feb. 29.
Costco Wholesale Corp.: Dec. 14
The Home Depot Inc.: Feb. 20
Lowe’s Cos Inc.: Feb. 27
Target Corp.: March 5
Walmart Inc.: Feb. 20

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2023 online holiday spending reached $221.1 billion

Mary Meisenzahl — Thu, 04 Jan 2024 15:00:59 +0000

U.S. online holiday spending reached $221.1 billion in 2023, according to Adobe Analytics. That’s in line with Adobe’s projection of $221.8 billion. Online holiday spending in the U.S. grew 4.9% over Adobe’s recorded $211.7 billion in 2022, setting a new ecommerce record.

The holiday season encompasses online spending between Nov. 1 and Dec. 31 across 1 trillion visits to U.S. retail sites, 100 million SKUs and 18 categories.

The majority of online holiday shopping happened in November, boosted by a strong Cyber 5. U.S. consumers spent $123.5 billion online in November, a 6% year-over-year increase. $38.0 billion of that spending took place between Thanksgiving and Cyber Monday, growing 7.8% over 2022.

The other $98.6 billion in U.S. online sales were recorded in December. Retailer sales that continued on past Cyber Monday drove some of that December spending, Adobe says.

Holiday spending by category

65% of online holiday spending in 2023 was in just five of the 18 categories Adobe tracks.

Top categories by online holiday spending:

Electronics ($50.8 billion)
Apparel ($41.5 billion)
Furniture ($27.3 billion)
Groceries ($19.1 billion)
Toys ($7.7 billion)

TVs, smart speakers, tablets, Bluetooth headphones, and smart watches ranked among the most popular online purchases during the holiday period. Pajamas, sneakers, and cold-weather items like sweatshirts dominated apparel sales. Popular furniture purchases included barstools, throw pillows and Christmas decor.

Aside from the top categories, skin care serums and moisturizers, vacuums, and small kitchen appliances were also top sellers, Adobe says.

Categories with the highest sales also recorded some of the largest discounts. Electronics discounts peaked at 31% off listed prices, followed by toys (28%) and apparel (24%).

Buy now, pay later (BNPL) in holiday spending

BNPL was used as a payment method in more online sales than ever this year, according to Adobe. It contributed $16.6 billion in online spending, an increase of 14% and $2.1 billion over the same period in 2022. U.S. consumers used BNPL for $9.2 billion in online purchases in November, up 17.5% year over year. Cyber Monday was the biggest BNPL day in history, accounting for $940 million in sales, up 42.5%.

“In an uncertain demand environment, retailers leaned on discounting and flexible payment methods to entice shoppers this holiday season,” Vivek Pandya, lead analyst at Adobe Digital Insights, said in a statement. “The strategy was effective, driving record spend online during big days like Cyber Monday and Black Friday, and a record 11 days that surpassed $4 billion in daily spend this season.”

The holiday season contributed to a huge year for BNPL use, accounting for $75 billion in online spending in 2023, up 14.3% from 2022.

Other holiday spending takeaways

Mobile shopping overtook desktop online sales for the first time in 2023. 51.1% of online sales across the holiday season were made via smartphones in 2023, up from 47% in 2022, Adobe says. Mobile sales peaked on Christmas Day at 65%, from 61% in 2022. Consumers made purchases on final holiday deals while spending time with friends and family, Adobe says.

Meanwhile, curbside pickup dipped slightly, though it still remains popular. It was used as a fulfillment method in 18.4% of online orders from retailers offering the option. That’s down from 21% in 2022. Usage peaked ahead of Christmas Eve on Dec. 22 and Dec. 23, accounting for 36.8% of orders during that time frame. Major retailers including Walmart and Target promoted their curbside capabilities through Christmas Eve.

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Consumers spend longer making holiday purchase decisions in 2023, new data shows

Abbas Haleem — Wed, 13 Dec 2023 21:26:37 +0000

Consumers are spending more time exploring retailers’ websites this holiday season, according to data from the ecommerce personalization platform Nosto.

Shoppers are taking longer this year to decide what they want to purchase, according to Nosto. The company analyzed more than 112 million website visits between Black Friday and Cyber Monday, the period known as the Cyber 5. The visits were to 1,127 online stores that use Nosto’s platform, including merchants based in North America, the United Kingdom and other parts of Europe, Latin America and the Asia Pacific region.

Nosto consumer insights from online holiday shopping

Online shoppers viewed 22% more pages on retailers’ websites per visit during the Cyber 5 in 2023 than they did in 2022, according to Nosto. They also spent 10% longer on each page, the data showed.

Compared with the same period in 2022, online shoppers were more than five times as likely this year to click on retailers’ on-site product recommendations. They were 81% more likely to click on personalized content that retailers showed on their ecommerce sites, and 13% more likely to click through product recommendations retailers sent via email marketing.

“Shoppers are definitely putting more time and effort into their holiday shopping, meaning that the retailers who make it easier for them to find the right products are reaping the benefits,” said Jan Soerensen, general manager for North America at Nosto.

Nosto attributes a 4.41% year-over-year increase in sales to the longer browsing time. Similarly, it also attributed a 4.1% increase in average order value for the online retailers to the increased time.

Understanding traffic growth by category, channel

Nosto found that traffic grew year over year among the health and beauty, fashion and accessories, and sporting goods and hobbies categories. Although the highest year-over-year traffic increase was among fashion and accessories brands that Nosto tracks (26.38% growth), the health and beauty category had the largest increases among the three when it came to both sales and average order value (AOV) increases.

Health and beauty online retailers that Nosto tracks increased sales 14.52% as AOV grew 11.21%. Fashion and accessories retailers using the platform increased sales 4.56% as AOV rose 4.27% year over year. Sporting goods and hobbies retailers increased traffic 23.03%, lifting sales 12.85% year over year as AOV grew 7.84%

All the while, mobile commerce accounted for nearly three-quarters of all traffic (74%) to online retailers using the Nosto platform during the Cyber 5. Mobile ecommerce sales represented 62% of total sales among online retailers Nosto tracks.

“However, consumers are still using desktops for their highest-value purchases, with this channel seeing an AOV of $141.59 (USD) compared with $109.01 on mobile,” Nosto said in a press release.

This mobile-majority share of ecommerce sales during the Cyber 5 falls in line with data from Adobe Analytics. Adobe found that Thanksgiving “set a new bar” for mobile shopping. 59% of Thanksgiving online sales came from a smartphone, compared with 55% in 2022, according to Adobe. And mobile shopping carried on strong through the Cyber 5, with 51.8% of online sales coming from smartphones. That’s up from 49.9% during the 2022 Cyber 5 period.

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Toy retailers target parents and ‘kidults’ with late-season discounts

Mary Meisenzahl — Mon, 11 Dec 2023 22:27:15 +0000

Toy retailers are looking for a late-season sales lift to save them after a shaky year. However, all hope isn’t lost. The fourth quarter typically accounts for about 70% of U.S. toy sales, according to retail research firm Coresight Research. That puts retailers and manufacturers in crunch time as the end of the year looms.

Toy sales so far in 2023

2023 has been a difficult year for toy sales. In the first nine months of the year, U.S. toy sales declined 9% over the same period in 2022, with unit sales down 9% and average selling price up 1%, according to a report from retail analysis firm Circana. Hasbro and Mattel previously warned of a potentially slow holiday season, Reuters reported.

“After record-high sales during the pandemic, 2023 is a period of rebalance for the toy industry,” Juli Lennett, U.S. toys industry advisor at Circana, said in a statement. “This situation is further amplified by the fact that consumers’ budgets are facing more headwinds than tailwinds this year. For manufacturers and retailers, a well-thought-out pricing strategy can mean the difference between success and failure closing out the year.”

Toy sales spiked on Cyber Monday, increasing 140% over a typical day in October, according to Adobe Analytics. However, discounts on toys were weaker than last year, going against the trend of other big holiday categories including electronics, apparel and furniture. Toy discounts averaged 27%, down from 34% in 2022, per Adobe.

Bigger discounts are coming, says Stever Pasierb, president and CEO of The Toy Association, a toy industry trade association. He points to toy retailers in the U.K. and Europe, who have been much more aggressive with discounts than in the U.S. so far. That’s because toy sales in those regions have been weaker than in the U.S., he says. Pasierb predicts further toy discounts coming for U.S. consumers as Christmas nears.

Toy sales target audience

Consumers looking to purchase toys generally fall into one of three categories, according to retail analysis firm Numerator.

Parents buy toys for their children on holidays and gifting occasions but also “just because.” They tend to be price-driven in purchasing decisions.
Gifters don’t have children under 18 but buy for other children in their lives. They tend to fall into the Boomer age cohort and are more likely to shop online than other groups.
“Kidults” buy toys and collectibles for themselves. They skew younger and are typically less price-driven than other groups.

About half of respondents in each category told Numerator that they plan to shop online for toys. The in-person shopping experience remains important for toys, though, according to Pasierb.

“Consumers want to see it, touch it, look at the packaging,” he says of toy shopping.

That may not necessarily be reflected in sales figures as consumers are likely to browse online and then make a purchase in a physical store when they can feel the toy themselves, or decide on a toy in a store and then make the actual purchase online.

Plush toys like Squishmallows are popular for both children and “kidults,” this year, says Pasierb, who dubbed 2023 “the year of plush.” Licensed toys related to TV or movie properties are also trending this year, he says, pointing to the success of the Barbie movie.

Retailers have been preparing for the toy sales season

Although many retailers held off on discounting toys until late in the season, they started working to build up anticipation for holiday toy sales months earlier.

Amazon, Walmart and Target are the largest toy retailers in the U.S., Pasierb says. Amazon released its “Toys We Love” list on Sept. 12 with 250 entries, the retailer’s longest holiday toy list to date. More than 80 of the toys are exclusive to Amazon. Macy’s also released “Geoffrey’s Hot Toy List” of 100 toys in September. (Macy’s has added Toys R Us-branded sections in its stores.) Then, in October, the retailer held giveaways and events in Macy’s stores across the country. Target’s list, “Bullseye’s 58 Top Toys of 2023,” came out in October, later than its competitors but one month earlier than in 2022, per Coresight. Like Amazon, Target touted exclusive items through its partnership — in Target’s case, with FAO Schwarz.

Amazon ranks No. 1 in the 2023 Digital Commerce 360 Top 1000, a ranking of North America’s leading retailers by online sales. Walmart (No. 2), Target (No. 5) and Macy’s (No. 17) all also rank among the top 20.

Walmart released a list of toys “Top Rated by Kids” in August, earlier than the other big retailers. Instead of focusing on exclusivity, the retailer highlighted affordable prices. More than half the toys on the list were priced under $25.

Pasierb says these tactics exemplify the two strategies toy retailers are taking this holiday season as consumers are careful about how they spend. Retailers can either emphasize the recognizable brands they carry to court larger tickets with toys from Mattel, Hasbro and others, or they can focus on lower-priced toys in hopes that consumers fill their carts with more products at lower costs.

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Thanksgiving breaks new ecommerce spending records

Mary Meisenzahl — Fri, 24 Nov 2023 18:06:31 +0000

While some were eating Thanksgiving dinner on Thursday night, others were already starting their biggest shopping week of the year.

Thanksgiving Day ecommerce sales set a new record of $5.6 billion in online spending, according to analysis from Adobe Analytics. That sets the stage for the rest of the week, including Black Friday and Cyber Monday.

Salesforce says U.S. Thanksgiving online sales reached $7.5 billion, and global sales totaled $31.7 billion, each growing 1% over Salesforce’s figures from last year.

“Cyber Week is off to a strong start as consumers took advantage of strong discounts and continued their shopping plans, virtually,” said Vivek Pandya, lead analyst, Adobe Digital Insights.

Thanksgiving ecommerce results

The $5.6 billion consumers spent online on Thanksgiving according to Adobe is a 5.5% increase over Thanksgiving 2022. The results are more impressive with a longer perspective. Online spending nearly doubled since 2017, when consumers spent $2.87 billion online shopping on Thanksgiving.

Toys were a top shopping category for consumers getting a jump start on holiday presents. Toy sales were up 182% over an average day in October, per Adobe. Discounts on toys reached 28%. Disney Little People, Uno Show No Mercy, Marvel figures, Barbie dolls, and stuffed animals were the most popular toys among Thanksgiving shoppers.

Jewelry sales were also strong, up 126%, along with apparel (124%), electronics (113%) and personal care products (67%). Electronics and computers recorded some of the highest discounts, of 27% and 22%, respectively. Gaming consoles including the Playstation 5, Xbox Series X and Nintendo Switch were all popular. Games for the consoles were also top sellers, Adobe recorded. Call of Duty: Modern Warfare III, Super Mario Bros. Wonder, Super Mario RPG, Hogwarts Legacy, and Mortal Kombat 1 were the top games. Robot vacuums, bluetooth speakers, tablets, workout apparel, and holiday decor rounded out the top seller list.

The average order value on U.S. Thanksgiving online orders was $119, according to Salesforce.

Mobile sales ruled Thanksgiving ecommerce

Mobile sales reached an all-time Thanksgiving high this year, according to Adobe Analytics. 59% of all Thanksgiving online sales were made on mobile devices, accounting for $3.3 billion in spending, an increase of 14% year over year.

Both mobile sales and online sales overall peaked between 9 p.m. and midnight PT, Adobe said.

Online traffic to retail websites grew 6% in the U.S. year over year, according to Salesforce. 82% of that traffic came from mobile devices. Mobile wallet usage also grew, up 44% year over year. Apple Pay drove much of that growth, increasing 47% over 2022.

Social media ads also drove sales through mobile traffic, according to Salesforce. Social media accounted for 13% of U.S. mobile traffic referrals to retailers.

“Mobile traffic and sales are soaring as people are on the go once again this holiday weekend. Consumers are embracing mobile wallets to break down friction between discovering on social and purchasing on mobile,” Rob Garf, vice president and general manager of retail at Salesforce, said in a statement.

Black Friday predictions

Adobe forecasts Black Friday will have the best deals on TVs, with discounts as deep as 22%. Apparel, appliances, sporting goods, toys and other categories will also be discounted, though Adobe says steeper discounts will come later for these types of purchases.

Black Friday is projected to account for $9.6 billion in online sales, according to Adobe forecasts. That would be a 5.7% increase year over year.

Meanwhile, Salesforce predicts that BOPIS (buy online, pick up in store) sales will increase on Black Friday as consumers look to avoid shopping in crowded stores.

Ecommerce fraud prevention vendor Signifyd says holiday sales are 6% higher than this time last year, as of mid-day on Black Friday.

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Michaels launches MakerPlace online marketplace

Mary Meisenzahl — Tue, 07 Nov 2023 18:01:02 +0000

The Michaels Company is launching a new online marketplace, called MakerPlace. The marketplace listed hundreds of thousands of SKUs at launch on Nov. 1, Michaels said in a press release.

Michaels ranks No. 111 in the Digital Commerce 360 Top 1000 database.

Michaels MakerPlace competes with Etsy

The retailer launched its marketplace following a successful three-month beta test, the retailer said.

MakerPlace is positioned as a competitor to Etsy Inc. In addition to handmade products, Michaels MakerPlace sellers can sell places in virtual classes and how-to guides.

Handmade bud vases for sales on Michaels MakerPlace.

“Our research found that nearly three in four makers believe there’s a void in the online marketplace landscape today, and that existing platforms come with pain points like high upfront costs, increasing fees for product listings and competition with an overflow of mass-produced goods,” says Heather Bennett, executive vice president of marketing and ecommerce at Michaels. “MakerPlace by Michaels was designed in direct response to these challenges with the goal of helping handmade artists and makers succeed,” she says.

Michaels MakerPlace doesn’t charge a listing fee to sellers. It charges a 4% referral fee to sellers on its basic subscription plan, along with a 2% referral fee to sellers in the professional tier, which costs $9.98 per month. All sellers pay a transaction fee of 3% plus $0.20 per item.

In comparison, Etsy charges a $0.20 listing fee and a 6.5% transaction fee. Etsy ranks No. 17 in Digital Commerce 360’s ranking of the Top 100 online marketplaces by GMV.

Why add an online marketplace?

Starting an online marketplace puts Michaels in good company. 40 retailers in the Top 1000 operate a consumer marketplace, with 23 those in the Top 100, according to Digital Commerce 360 research.

“For retailers like Michaels, with specific audiences, adding a marketplace expands selection in a way that consumers appreciate,” says James Risley, research data manager and senior analyst at Digital Commerce 360.

Michaels can lend its name recognition and trust among consumers to marketplace sellers, and consumers might then feel safer buying those items from a known source, he says. It’s also a way to generate revenue beyond selling goods, with the learning component in the marketplace.

“With Michaels’ solution, there’s a little risk in moderation, making sure a woodworking class isn’t turned into a venue for how to make weapons. But I think it’s a good niche for this kind of non-goods marketplace,” Risley says.

MakerPlace will operate alongside the other third-party marketplace Michaels launched in February. That marketplace appears on Michaels.com alongside first-party goods, and expanded Michaels online offerings to more than 1 million SKUs.

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Earnings recap: What you missed from Amazon, Deckers and more

Mary Meisenzahl — Fri, 27 Oct 2023 18:28:07 +0000

This week, more retailers in Digital Commerce 360’s Top 1000 list of leading ecommerce retailers in North America reported ecommerce earnings results for the most recent fiscal quarter. Here’s the ecommerce earnings summary you need to know from this week. Read more ecommerce earnings coverage here.

Parentheses indicate the merchant’s ranking in the Top 1000.

Amazon.com Inc. (No. 1)

Amazon recorded its highest operating income ever in the third quarter ended Sept. 30. Operating income nearly quadrupled year over year, growing 343%.

Read more about Amazon’s earnings here.

Columbia Sportswear Co. (No. 149)

Columbia reported net sales grew 3% in its fiscal third quarter ended Sept. 30, 2023. Growth was balanced between wholesale and direct-to-consumer channels, it said. Physical stores are outperforming ecommerce within direct to consumer.

“Consumer demand for soft goods, including apparel, footwear, remains weak,” Tim Boyle, CEO, said in an earnings call.

Deckers Brands (No. 74)

Deckers reported revenue grew 25% to $1.1 billion in its second fiscal quarter of 2024 ended Sept. 30. Direct-to-consumer net sales increased 38.8% to $331.7 million.

“Consumer demand was robust in stores and online,” says Dave Powers, Deckers CEO. Greater numbers of Hoka and Ugg brands drove average prices up, he said. [what do you mean? products from those brands?]

Hasbro Inc. (No. 554)

Hasbro reported revenue declined 10% in the third quarter ended Oct. 1. However, the toy retailer reported large gains in online gaming. Digital gaming revenue grew 40%, driven by Magic The Gathering and Dungeons and Dragons. Consumer products and entertainment revenue declined 18% and 42%, respectively.

Overstock.com Inc. (No. 49)

Overstock reported revenue declined 19% to $373 million in the third quarter ended Sept. 30. Results reflect the Overstock brand through July 31, and Bed Bath & Beyond beginning Aug. 1. Active customers declined 15% and net revenue per active customer declined 13%.

Skechers USA Inc. (No. 301)

Skechers reported sales grew 7.8% to $2.0 billion in the third quarter ended Sept. 30. Direct-to-consumer sales, which include ecommerce, grew 23.8%. Domestic ecommerce slowed as U.S. consumers returned to stores. Last year at this time, stores had a lack of inventory, pushing consumers online, the retailer said. This year, stores are better stocked, so consumers went there first. [attribution?]

Tractor Supply Co. (No. 99)

Tractor Supply report net sales grew 4.3% to $3.41 billion in the third quarter ended Sept. 30. Ecommerce sales grew in the high single digits, the retailer said without revealing more. Digital sales made up more than $1 billion in the last 12 months. The Buy Online, Deliver from Store program is also doing well, Tractor Supply said.

Meanwhile, comparable sales declined 0.4%.

United Parcel Service Inc.

UPS reported profits and revenue declined in its fiscal third quarter ended Sept. 30, 2023. UPS consolidated revenue declined 12.8% from the year-ago period to $21.1 billion. Consolidated operating profit declined 48.7% over the same period to $1.3 billion.

So what does it mean?

Retailers are still reporting soft consumer demand in the face of rising prices and turn toward experiences rather than physical goods.
However, some apparel retailers are reporting bright spots. Deckers and Skechers both say they’re seeing strong interest from consumers.

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Earnings recap: What you missed from American Eagle, Kroger, Zumiez and more

Mary Meisenzahl — Fri, 08 Sep 2023 19:56:42 +0000

American Eagle Outfitters Inc. (No. 54 in the Top 1000)

American Eagle reported digital revenue declined 7% in the fiscal second quarter ended July 29, 2023. Meanwhile, store revenue grew 4% and total net revenue was up “slightly” to $1.2 billion.

“Demand picked up in June and July, reflecting brand strength and on trend collections that are resonating well with customers, supported by exciting new marketing campaigns,” CEO Jay Schottenstein said in a written statement.

Following improvements to BOPIS offerings in the quarter, pickup penetration doubled, the retailer said. That is leading to savings on shipping costs and leading to additional sales.

Designer Brands Inc. (No. 77)

Designer Brands reported net sales declined 7.8% to $792.2 million for the fiscal second quarter ended July 29, 2023. Total comparable sales, which include ecommerce sales, declined 8.9%. The shoe retailer did not share specific information about online sales. It also took over hushpuppies.com, its sixth ecommerce brand website.

Designer Brands noted declines in consumer spending. Forecasts are uncertain due to “competitive inventory, the health of the consumer and overall macroeconomic headwinds,” said Jared Poff, chief financial officer.

Express Inc. (No. 114)

Express reported online sales decreased 1% in the fiscal second quarter ended July 30, 2023. Retail store comparable sales declined 21% during the same period. Consolidated net sales declined 6% to $435.3 million.

Ecommerce sales were a highlight of the quarter, nearly offsetting depressed store sales, particularly in women’s products, the retailer said.

J. Jill (No. 246)

J.Jill reported total net sales declined 2.9% to $155.7 million in the fiscal second quarter ended July 29, 2023. Direct-to-consumer sales decreased 5.1%, representing 44.7% of total sales. Comparable sales, including both stores and DTC, declined 1.3%.

A high rate of online returns continues to hurt margins, the apparel retailer said, though they are starting to stabilize.

Kirkland’s Inc. (No. 518)

Kirkland’s reported online sales declined 16.6% in the fiscal second quarter ended July 29, 2023. Comparable store sales declined 9.7%. Net sales decreased to $89.5 million from $102.1 million in the year-ago period. Declines were due to decreases in traffic and average ticket, the retailer said.

“The second quarter sales results were challenged by lower traffic and the aggressive liquidation efforts in Q2 of last year that presented a tough sales comparison, period over period,” interim CEO Ann Joyce said in a statement.

The Kroger Co. (No. 8)

Kroger reported online sales grew 12% in the fiscal second quarter ended Aug. 12, 2023. Total company sales declined to $33.9 billion from $34.6 billion the previous year. However, excluding fuel, sales increased 1.1%.

“Looking forward, we believe inflation will continue to decelerate and the environment will remain challenging for consumers. We therefore expect identical sales without fuel will be at the low end of our full-year guidance range and slightly negative in the second half of the year,” Gary Millerchip, chief financial officer, said in a written statement.

GameStop Corp. (No. 41)

GameStop reported net sales grew to $1.16 billion from $1.14 billion the previous year for the fiscal second quarter ended July 29, 2023. Net loss was $2.8 million, compared to $108.7 million last year. The retailer did not share additional information on online sales.

Sportsman’s Warehouse (No. 361)

Sportsman’s Warehouse reported net sales declined 11.8% to $309.5 million in the fiscal second quarter ended July 29, 2023.

“We were disappointed with our second-quarter results and the slowdown in store traffic, as the challenging macroeconomic conditions continue to pressure consumer discretionary spending,” interim CEO Joseph Schneider said in a written statement.

However, omnichannel sales were a bright spot, he said, with ecommerce sales outpacing in-store sales.

Zumiez Inc. (No. 452)

Zumiez reported net sales declined 11.6% to $194.4 million in the fiscal second quarter ended July 29, 2023. Net sales for the first six months also declined 14.4% year over year. CEO Rich Brooks called out “continued headwinds facing consumer discretionary spending combined with a heightened promotional marketplace” as explanations for the sales slump.

However, he said back-to-school sales have been promising so far, and are historically a good indicator of upcoming holiday sales.

So what does it mean?

Retailers across the board are seeing consumers cut back on non-essential spending, per ecommerce earnings reports. Even grocery retailer Kroger notes the pullback, although it managed to grow online sales.
Apparel retailers appear to be bearing the brunt of the decline in spending. American Eagle is an exception, growing in-store sales while online sales declined.

In case you missed it: Best Buy, Chewy, Lululemon, Land’s End and more reported last week.

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Etsy sales in Q2 are flat; CEO teases AI, ML expansion

Abbas Haleem — Thu, 03 Aug 2023 18:55:07 +0000

Etsy Inc.’s active buyers reached an all-time high in its fiscal second quarter ended June 30, 2023. Still, Etsy’s gross merchandise sales (GMS) were largely flat.

Etsy gross merchandise sales (GMS)

Etsy sales in Q2 reached $3.0 billion. That’s down 0.6% year over year. Whereas Etsy sales were nearly flat, revenue grew. Etsy revenue reached $628.9 million. That’s up 7.5% from the year-ago period.

The marketplace’s active buyers grew 3% year over year to reach 91 million. It acquired 6 million new buyers and retained 21% more buyers than during the year-ago period. Etsy “retained active buyers at levels above pre-pandemic rates,” it said in an Aug. 2 earnings press release. “On a quarterly basis, active buyer retention trends improved both from the prior year and prior quarter.”

Etsy GMS per active buyer declined 6% year over year to $128 in Q2. The number of habitual buyers “was largely flat” at 7 million.

CEO Josh Silverman said more than a quarter of GMS comes from buyers who purchased again within 14 days of their prior purchase.

Silverman said about 14% of GMS from wedding registries came from new buyers. He added that Etsy is experiencing higher-than-average order value from those items.

“While GMS per buyer has shown early signs of stabilization, taking this metric to new heights is a top priority for us,” Silverman said.

Etsy ranks No. 17 in Digital Commerce 360’s new 2023 Global Online Marketplaces Report. The Global Online Marketplaces Database ranks the 100 largest such marketplaces by 2023 third-party GMV.

The online sales of mass merchants like Etsy grew 5.6% in 2022, outpacing the growth rate of total U.S. retail sales (3.3%), according to a Digital Commerce 360 analysis of U.S. Department of Commerce retail data.

Etsy wields AI, machine learning tools

Silverman attributed positive trends to the number of items available on Etsy and the average search result yielding more than 1,000 listings.

“Our product teams are helping buyers more easily navigate the breadth and depth of our sellers’ inventory leveraging the latest AI advances to improve our discovery and inspiration experiences, while surfacing the very best of Etsy,” Silverman said.

He said Etsy has more than double the size of its “Best of Etsy” library in the past quarter. He said expert merchandisers curate the library based on items’ visual appeal, uniqueness and apparent craftsmanship.

“We’re now using this library to train our ML (machine learning) models to better predict of quality of items as perceived by humans,” Silverman said. “We’re seeing encouraging results from first iterations on these models, and I’m optimistic that this work will have a material impact helping us to surface the best of Etsy in every search.”

He said specific to Etsy’s trust and safety, advances in AI and machine learning have enable enforcement models to detect an increasing number of policy violations. Combined with “human knowhow,” he said, that “is starting to have a meaningful impact on the buyer and seller experience.”

Similar to Ebay, Etsy is using artificial intelligence and machine learning to:

Enhance buyer search and recommendations
Streamline sellers’ listing process
Assist with customer queries
Improve fraud detection and safety models

Etsy agrees to sell Elo7

Silverman said Etsy agreed two weeks before its Q2 earnings call to sell its Brazil-based handmade goods marketplace, Elo7. It sold Elo7 to Enjoei, a Brazilian company that operates an online marketplace for clothes and furniture.

Etsy acquired Elo7 in July 2021 and sold it last month for $217 million, according to a Business Insider report.

Moreover, Etsy also owns marketplaces Reverb (No. 45) and Depop (No. 58).

Etsy earnings

For the fiscal second quarter ended June 30, Etsy Inc. reported:

Active buyers reached 91 million. That’s 3% growth and a new company record.
Etsy gross merchandise sales, or GMS, declined to $3.01 billion. That’s down 0.6% from $3.03 billion in the second quarter of fiscal 2022.
Etsy revenue grew to $628.88 million. That’s up 7.5% from $585.14 million in the year-ago period.

For the fiscal first half ended June 30, Etsy Inc. reported:

Etsy gross merchandise sales, or GMS, declined to $6.11 billion. That’s down 2.7% from $6.28 billion in the first half of fiscal 2022.
Etsy revenue grew to $1.27 billion. That’s up 9.0% from $1.16 billion in the year-ago period.
Etsy active sellers grew to 8.31 million. That’s up 12.3% from 7.4 million in the previous year.

Percentage changes may not align exactly with dollar figures due to rounding.

Check back for more earnings reports.

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