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.

Read more on Costco’s earnings here.

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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The Toy Association: four trends for 2024

1. Sustainability

Consumers increasingly care about sustainability, which is now a common concern when purchasing toys, the association said. Nearly half (45%) of parents under age 40 consider the environmental impact of a toy when making purchasing decisions, it found in a recent survey of U.S. parents. 

“In 2024, toymakers will prioritize sustainability not only as a commitment to using eco-friendly materials, but also as a holistic approach aligned with these evolving consumer values,” said Kristin Morency Goldman, senior director of strategic communications at The Toy Association. Some toys aligned with this trend will address environmental factors directly, like a new version of Settlers of Catan that asks players to engage with ecological events and make decisions between fossil fuels and clean energy. Other traditionally plastic toys will advertise the use of plant-based materials.

Consumers are most concerned with the durability aspect of sustainability, according to a 2023 Deloitte Sustainable Consumer report. To that end, toy makers will also emphasize the craftsmanship of toys and their ability to be repurposed as children age.

2. Fantasy and mystery

Goldman pointed to a “resurgent cultural interest in spooky, mystery, and horror genres across movies, TV, and literature” driving this trend. The Toy Association named the Netflix series “Wednesday” a top media property to watch. The show surpassed “Stranger Things” to become the top-viewed English-language Netflix series in its first week. Mattel signed a multi-year licensing deal to produce toys based on the series for its Monster High and Little People lines. In addition, Mattel relaunched the Monster High line in 2023 and said it was the highest growth property among its doll category.

Another high-profile property, Harry Potter, will also drive sales in this toy category, the association said. Goldman pointed to the Talking Sorting Hat toy sold by Lego debuting in the spring.

3. Sports 

Consumers increasingly prefer toys that teach a skill and incorporate screen-free play, said Jen Lynch, content developer at The Toy Association. 65% of parents said they want toys that help build a skill, per a survey from the association. The group predicts a boost in popularity for sports toys, bolstered by the 2024 Summer Olympics. Sports is the highest-selling category within toys, accounting for $4.5 billion in 2023, although it also saw the greatest sales declines, down 16%.

The Toy Association expects Pickleball to be popular, along with new Nerf offerings from Hasbro and other sensory toys.

4. Anime

Toys based on media properties continue to be popular, and anime is the next area poised to grow, the association predicts. Anime reached new mainstream audiences in recent years, propelled by an interest in escapism during the pandemic. One in four parents said in a survey that they’re likely to buy children toys based on an anime franchise.

The genre is increasingly accessible through streaming services, making it more valuable, Lynch said. “Naruto” and “One Piece” are the most sought-after licenses, she said. This category also gives retailers an opportunity to target “kidults,” who engage with anime on social media and buy toys for themselves. 

State of the toy industry

2023 was a difficult year for toy retailers. Sales were depressed going into the holidays, which is usually the main event for the industry driven by end-of-year sales and gifting. The fourth quarter typically accounts for about 70% of U.S. toy sales, according to retail research firm Coresight Research. 

Holiday sales weren’t enough to make up for declines throughout the year. 2023 toy sales declined 8% from 2022 to 2023, totaling $28.0 billion, according to research firm Circana.

The Toy Association didn’t make explicit overall sales predictions for 2024. However, there’s hope that slowing inflation and lower interest rates might have an impact on toy sales later in the year, it said.

Mattel’s results

Toy retailer Mattel outperformed the industry as a whole in 2023. It reported net sales grew 16% in the fiscal fourth quarter ended Dec. 31. Sales were flat for the year.

“Execution on our toy strategy was strong and we made meaningful progress in entertainment across film, television, digital and publishing. We ended 2023 with the strongest balance sheet we have had in years, putting us in an excellent position to execute our strategy to grow Mattel’s IP-driven toy business and expand our entertainment offering,” CEO Ynon Kriez said. “As we look to 2024, we believe we are very well positioned competitively and will continue to outpace the industry and gain market share.”

However, the retailer anticipates the industry will see further spending decline in 2024.

“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,” Kreiz said. It predicts growth will resume in 2025.

Mattel ranks No. 205 in the 2023 Digital Commerce 360 Top 1000, a ranking of North America’s leading retailers by online sales.

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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.

Read more about Alibaba’s earnings here.

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)

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.

Read more on Costco’s earnings here.

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.

Read more about Estee Lauder’s earnings here.

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.

Read more about Ralph Lauren’s earnings here.

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.

Read more about Under Armour’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.

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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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. 

1. Parents buy toys for their children on holidays and gifting occasions but also “just because.” They tend to be price-driven in purchasing decisions.
2. 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.
3. “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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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.

Read more here.

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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Amazon Inc. (No. 1)

Amazon reported sales grew 11% to $134.4 billion in the quarter ended June 30. Online stores, which account for 39.4% of sales, grew just 4.2%. Read the full story here. 

Boot Barn Inc. (No. 327)

Boot Barn reported net sales grew 4.9% to $383.7 million in its fiscal first quarter of 2024 ended July 1. Same-store sales decreased 2.9% year over year, and ecommerce same-store sales decreased 10.8% over the same period. Net sales grew due to new stores and higher retail prices, Boot Barn said.

Online sales made up 9.9% of net sales, totaling about $38 million. 

“Despite the slowness in ecommerce sales, we are quite pleased with the many achievements we have seen from an omnichannel perspective,” president and CEO Jim Conroy told investors. Boot Barn predicts ecommerce sales will begin growing again in September or October.

Columbia Sportswear Co. (No. 147)

Columbia reported net sales grew 7% in the second quarter ended June 30, reaching $620.9 million. U.S. online sales were “down mid-single-digit percent,” because “the online environment has become more competitive and promotional as consumers seek out value in the marketplace,” CEO Tim Boyle said in an earnings call. 

Direct-to-consumer (DTC) sales were up slightly to $660 million for the quarter. They include both online and physical store sales.

Ecommerce was the slowest growing part of the business in the quarter, below expectations, the sports retailer said. 

The Container Store Inc. (No. 471)

The Container Store reported consolidated net sales declined 21.1% in its first quarter ended July 1, to $207.1 million. Comparable store sales were down 19.9% over the same period. Online sales fared slightly better, down 15.8% in the first quarter.

Website-generated sales, including curbside pickup, showed a relatively low decline at 10.5% year over year. Those web-generated sales made up a bigger portion of total sales this quarter (24.1%) than in the year-ago period (21.3%).

CVS Health Corp. (No. 95)

CVS reported total revenue grew 10.3% to $88.9 billion in its second quarter ended June 30. The bulk of the growth comes from the health care benefits part of the business, which grew revenue 17.6% to $26.7 billion.

CVS didn’t break out specific information about online sales, but it did note that 5% same-store prescription revenue growth was fueled by growing omnichannel offerings.

Digital Commerce 360 estimates that CVS online sales were about $989,000,000 in 2022, making up about 10% of total sales.

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

Beauty brand E.l.f. Cosmetics reported net sales growth of 76% in its fiscal Q1 ended June 30, to $216.3 million. The retailer noted it was the 18th consecutive quarter of net sales growth and market share gains. 

Online sales grew by “triple digits,” the retailer said without revealing more. Digital penetration reached 18%, compared with 14% in 2022. The retailer has “really good strength” in online sales through its own website, Amazon, and other retail beauty websites that carry its products, it said. 

Ethan Allen Global Inc. (No. 525)

Ethan Allen reported consolidated net sales declined 18.4% to $187.4 million in the fiscal fourth quarter ended June 30. Retail and wholesale net sales declined at nearly the same rate, 17.2% and 16.7%, respectively. The home furnishing retailer did not share specifics on digital sales.

Hasbro (No. 556)

Hasbro reported revenue declined 10% in its second quarter ended July 2, 2023 to $1.2 billion. Franchise brands, including Peppa Pig, Transformers, and Play-Doh saw smaller revenue declines at 5% than other brands the retailer sells.

Digital sales were a high point for the retailer, with digital gaming revenue up 33%. That section of the business is performing ahead of expectations, Hasbro said. 

Petmed Express Inc. (No. 351)

Petmed Express reported net sales for the quarter ended June 30 grew 11.5% to $78.2 million.

The retailer said it also grew new customers 25% year over year. 49% of revenue came from auto-ship subscriptions and memberships, CEO Matt Hulett said in a written statement. 

Revolve Group Inc. (No. 87)

Revolve announced net sales declined 6% to $273.7 million in the quarter ended June 30. The apparel retailer also reported that net income declined 55% to $7.3 million due to “the decline in net sales, reduction in gross profit year over year and continued pressure on certain operating expenses.”

The return rate is also higher than expected, Revolve said, leading to higher costs. The retailer did not share specific information on ecommerce sales.

Steve Madden Ltd. (No.260)

Steve Madden reported revenue declined 16.8% to $535 million in the quarter ended June 30. Wholesale revenue declined 20.8%, while DTC revenue was down 5.4% to $128.2 million.

Ecommerce sales outperformed brick and mortar sales, the shoe retailer said in a call with investors. 

Wayfair Inc. (No. 10)

Wayfair reported net revenue declined 3.4% to $3.2 billion in its second quarter ended June 30. Losses came in at $46 million, well below investor expectations of $74 million. Read more here. 

So what does it mean?

• Omnichannel is still alive and well as a retail strategy, despite predictions that fulfillment methods like curbside pickup and buy online, pick up in store (BOPIS) were pandemic-era trends. Executives at Boot Barn, CVS and The Container Store all called out omnichannel offerings as areas of strength.
• Online competition is impacting nearly everyone. Columbia Sportswear specifically cited a more crowded online marketplace making it more difficult to reach consumers. That’s not as much of a problem for retailers like E.l.f., which has a distinct offering to consumers with its budget products, even in the crowded beauty space. 

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Net income rose 3.7% to 13.8 billion kroner ($2 billion) in 2022, the Billund, Denmark-based company said on Tuesday. Expenses jumped 22% and revenue rose 17% to 64.6 billion kroner, driving gains in market share. Lego grew online sales by about 10.5% in 2022, according to Digital Commerce 360’s estimates. Lego is privately held and does not release all financial information.

The LEGO Group is No. 129 in the 2022 Digital Commerce 360 Europe Database.

Lego opened stores and produced more toys

The maker of colorful building bricks, which is owned by the billionaire Kirk Kristiansen family, opened 155 new branded stores last year and increased production at three of its five factories. It’s also working on building two new large facilities in Vietnam and the United States. The company said it expects to win market share again this year with “single-digit” revenue growth.

Lego’s results were better than the company had expected, CEO Niels B. Christiansen said.

Earnings momentum “was driven by the investments made during this time, which are both paying off now and establishing a foundation for long-term, sustainable growth,” the CEO said in the statement. “We plan to accelerate investments in strategic initiatives in the coming years.”

Lego plans to hire 500 more digital experts in Denmark, the United Kingdom and China in addition to as many as 6,000 workers for its new factories in the U.S. and Vietnam in coming years, Christiansen said.

Other toymakers see declining demand

Lego’s hiring spree is an outlier in the the toy market, which shrunk last year. Its biggest rivals, Mattel Inc. and Hasbro Inc., both reduced headcount in 2022.

Lego’s U.S. rival Mattel Inc., which owns the Barbie brand, last month said it expects no revenue growth this year, while the other large U.S. toymaker, Hasbro Inc., said it sees a contraction. Hasbro cut its workforce by another 1,000 jobs, about 15% of workers, after a poor holiday season. Hasbro said the digital gaming business, including the Dungeons & Dragons and Magic the Gathering games, performed well. However, its traditional toy business faltered. Both companies said toy sales were down after a boom during the pandemic.

Mattel and Hasbro are No. 203 and No. 534, respectively, in the 2022 Digital Commerce 360 database of the largest North American online retailers by web sales.

Lego as a symbol of resistance

In 2022, Lego made headlines for its symbolism following the Russian invasion of Ukraine. The toy manufacturer said it had “paused shipments of products to Russia given the extensive disruption to the operating environment,” and donated more than $16 million to humanitarian organizations.

Polish illustrator Paweł Jońca was inspired by Lego’s blue and yellow similarity to the Ukrainian flag. He created a poster showing a red bear representing Russia, stepping on blue and yellow Lego blocks representing Ukraine.

“The proportions and colors refer to huge Russia and smaller Ukraine,” Jońca said. “The heaviness of the aggressor and the tenacity and persistence of the defender. Most viewers associated stepping on the block with their own experience and immediately thought, ‘Hope it hurts!’”

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The post Lego’s profit grows slightly as other toy retailers see shrinking demand appeared first on Digital Commerce 360.

Amazon Prime Early Access runs Oct. 11-12. The sitewide sale spans multiple categories. Digital Commerce 360 reviewed how retailers across the Top 1000 approached this year’s additional Amazon Prime sale. Amazon.com Inc. is the No. 1 in the 2022 Digital Commerce 360 Top 1000, which ranks the largest North American e-retailers by web sales.

Amazon Prime Day vs. Early Access

Of those 80 retailers running promotions, 18.8% of retailers competed directly with Amazon, citing a Prime Day Early Access-like sale. That’s down from the 38.0% of 79 retailers that ran promotions during Amazon’s July 11 and 12 Prime Days. 

17.5% of retailers tied promotions directly to a holiday, such as Christmas, Thanksgiving weekend or Halloween. That’s down from 44.3% of retailers that tied promotions to a holiday (including Prime Days) in July. Retailers that linked promotions to the holidays included mentions of Black Friday (28.6%), Christmas (35.7%), Halloween (21.4%) and Thanksgiving (7.1%).

And 5.0% of retailers used specific Prime-related language and timed promotions on their homepages during the Prime Early Access event or around these days. That’s down from 15.2% of retailers during July’s sale days.

Retailers varied the language used to promote sales. 15.0% of promoting retailers included one of the following keywords: holiday, Prime, early access, gifting and X-day sale. 

In July, 85.7% of retailers with holiday promotions cited Prime Day directly, while also noting Back to School (14.3%), Black Friday (8.6%) and 4th of July (2.9%). 

Fifteen retailers emphasized competition with Amazon’s Prime Early Access Days, including Macys.com, which tied both Prime and holiday language for its two-days-only “Holiday Early Access” sale. Costco Wholesale Corp. highlighted member savings days, while Dick’s Sporting Goods noted three-day-only deals.

Macy’s.com cited “early access” as part of its 2-day holiday promotional strategy on Oct. 11.

Gen Z apparel retailer PacSun took it one step further with a blazing banner displaying up to 40% off and popups of its PacFridayPreview noting two days left.

PacSun promoted its limited-time PacFridayPreview on its home page on Oct. 11.

Consumers are making careful purchases

The decline in retailers’ competing sales in October compared to July might have to do with the current economic environment, fraught with inflation and higher prices for necessities like gas and groceries, says Alexander Winston, consultant at Propeller, a business consulting agency. Today, inflation is reducing buying power. Winston cautions against retailers promoting too early and too often. As holiday selling seasons are landing earlier and earlier, there will be a limit to the “juice to be squeezed” from consumers, he says.

“Consumers are expected to spend an average of 6% more versus last year, with inflation climbing above 8%, indicating softer sales this year,” Winston says.

And because consumers will be more wary of spending this year, there is likely to be more demand around essential purchases than nice-to-haves, said Thomas Kasemir, chief product officer at Productsup, a product-to-consumer software vendor. 

“By running a sales event in October, businesses can get a better understanding of what the essential purchases are this year,” Kasemir said. “Brands can’t afford to lose out on sales this Black Friday and Cyber Monday. So, an early sales event acts as a trial run to work out any kinks in their system.”

Target and Walmart mirror Prime Days and Early Access strategies

Once again, Amazon’s direct competitors held sales, albeit a different approach from Amazon. Target Corp. (No. 5) launched its own deal days to compete with Amazon. The three-day sale occurred before Amazon Prime Early Access, held from Oct. 6 through Oct. 8. Deals ranged to up to 50% off, similar to its July 3-day deals, which ranged from 5% to 60% off. On Oct. 11, Target launched Black Friday deals on its homepage.

Meanwhile, Walmart Inc. (No. 2) displayed a more muted homepage on Oct. 11, highlighting a “flash deal” item at the top. The retailer promoted some Halloween deals rather than Black Friday. It also included the usual promotion of its 30-day free trial for its membership program. 

Gift cards, Amazon photo projects among top sought items

By 9 a.m. ET, Oct. 12, Chicago-based market research firm Numerator captured 13,215 orders with an average order value of $45.50. That totals just over $606,000 in sales. Given that Digital Commerce 360 estimated that Amazon’s sales on the Prime Day event earlier this year exceeded $12 billion, it is important to note that Numerator is only capturing a small subset of Amazon orders.   

The top items include Amazon photo projects, Amazon gift cards and Amazon essentials women’s apparel. Most items (59%) have sold for under $20, while 4% sold for more than $100. According to Numerator, the top categories consumers say they’ve purchased are household essentials, health & beauty, and apparel and shoes. 14% of shoppers purchased expensive items they waited for a sale in order to buy. 

Discount types 

Fewer retailers, 71.3%, offered percent-off discounts as part of the October promotion, according to Digital Commerce 360’s site checks. That compares with 77.2% of retailers that offered the same discount type for Amazon Prime Days in July. Percentage discounts ranged from 5.0% to 80.0% off, with the median retailers’ maximum percentage off at 40% and median minimum at 10.0%.

In October, more retailers offered dollar-figure discounts (25.0%) and free shipping (28.8%) as promotions. Fewer offered gifts with purchase (6.3%), and fewer retailers offered multiple types of discounts during day one of Amazon Prime Early Access (36.6%). That compares with 40.5% in July.

Other types of discounts included Chewy.com Inc.’s promotion for a $30 e-gift card when spending $100. Overstock.com Inc. flashed a “free shipping on everything” promotion, and Lands’ End promoted its Warm Coat Drive in place through Nov. 20, where a customer receives 50% off a new Lands’ End coat in exchange for gently worn coats given in stores.

No-discount retailers

While the majority of retailers in the Digital Commerce 360 panel offered sales, 20.0% offered no discounts at all. This is similar to July, except the majority not offering deals was more evenly distributed among consumer brand manufacturers and retail chains.

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The post Retailers dial down promotions during Amazon Prime Early Access sale appeared first on Digital Commerce 360.

The post Toys and hobbies retailers grew ecommerce sales 19.1% in 2021 appeared first on Digital Commerce 360.

According to Macy’s, the in-store shops will range from 1,000 square feet for smaller shops to 10,000 square feet for “flagship” locations in Atlanta, Chicago, Honolulu, Houston, Los Angeles, Miami, New York and San Francisco. The department store chain says the footprint of each Toys R Us shop might “flex up” an additional 500 to 3,000 square feet during the holiday season, according to a statement from Macy’s.

Macy’s did not immediately respond to a request for further details.

A Macy’s Toys “R” Us on July 11, 2022, in Jersey City, New Jersey.

Since buying the Toys R Us brand in early 2021, WHP has worked to re-establish the brand’s physical and online presence. In August 2021, Macy’s and WHP launched a strategic partnership to bring Toys R Us shops to 400 Macy’s stores nationwide. In addition, ToysRUs.com became part of the Macy’s online ecosystem.

Macy’s, with 511 locations, is the largest retail brand owned by Macy’s Inc. (No. 16 in the 2022 Digital Commerce 360 Top 1000). Macy’s also owns the Bloomingdale’s department store chain and the Bluemercury cosmetics brand.

When shoppers go to a product detail page on ToysRUs.com and click “Buy Now,” the site redirects them to purchase from Macys.com. Macy’s makes the same toy selection available at macys.com/toysrus.

What’s the long-term vision?

By working with Toys R Us, Macy’s is betting its toy selection will bring shoppers into stores. It’s also diving deeper into an online category that grew a bit faster last year than overall ecommerce. According to Digital Commerce 360 data, sales for the 50 toy and hobby e-retailers ranked in the 2022 Digital Commerce 360 Top 1000 rose 19.3% in 2021, compared with 15.7% for the whole Top 1000.

Melissa Minkow, director of retail strategy at ecommerce technology vendor CI&T, says the Macy’s and Toys R Us partnership “strategically leverages consumers’ desires for experiential in-store retail,” but is skeptical about whether it will produce long-term results.

“If Macy’s ultimately maintains this store-within-a-store past holiday shopping timing, there will need to be a big-picture vision for the future of this partnership,” Minkow says. “No matter how strong the sales lift, if it’s only for a few months, that’s not enough to fix both brands’ history of losses.”

Trying to make a comeback

Like many well-known brands in bankruptcy, Toys R Us gained a second life when Tru Kids Inc., an entity owned by creditors, bought its intellectual property. Tru Kids had its own store strategy but closed its two U.S. locations in 2021. Oaktree Capital-backed WHP Global then bought a controlling interest

Once a dominant toy retailer, Toys R Us filed for bankruptcy in 2017. Since then, the retailer has changed ownership twice. It partnered with Target Corp. (No. 5 in the Top 1000) and Amazon.com Inc. (No. 1) before WHP later struck its deal with Macy’s to help it make a comeback.

In December 2021, WHP launched the first physical Toys R Us store in the United States since the original company liquidated itself in 2018. The new location is a 20,000-square-foot, two-story store at the massive American Dream entertainment and retail center in East Rutherford, New Jersey. That puts the new store steps away from the mall’s kid-friendly Nickelodeon Universe Theme Park and DreamWorks Water Park.

WHP says Toys R Us operates more than 900 stores and ecommerce sites in 25 countries outside the U.S.

Bloomberg News contributed to this report.

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The post Toys R Us is opening shops in all Macy’s stores appeared first on Digital Commerce 360.