šŸŽ†What Drives Consumer Behavior on the Fourth of July?

A mix of patriotic enthusiasm, tradition, and seasonal activities

Hello, Retailist Roundup readers! As we wrap up another exciting week, the energy in the retail and e-commerce world is electrifying. This past week has been filled with groundbreaking updates, emerging trends, and innovative developments that are revolutionizing our industry. šŸŽ†And with Independence Day, it's the perfect time to celebrate these advancements and their impact on our dynamic community. Ready to dive into the top stories? Join us as we explore these updates and their implications!

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In the news: Top headlines this week

All Bobā€™s Stores locations to close. Bobā€™s Stores is closing all its locations after failing to secure the necessary financing to continue operations. Going-out-of-business sales with discounts up to 70% have started, and gift cards or merchandise credits can be used until July 14. The closure affects stores in Connecticut, Massachusetts, New Hampshire, New Jersey, New York, and Rhode Island, and includes the liquidation of store fixtures, furniture, and equipment, managed by Hilco Merchant Resources and Gordon Brothers. [Retail Dive]

New Data Shows YouTube Leads the Way in Influencing Kidsā€™ Purchases. A new report by Precise TV and Giraffe Insights shows that YouTube is the top platform influencing children's purchase decisions, with 81% of children recently watching it. This surpasses other entertainment sources such as video on demand (62%), video games (45%), TikTok (44%), and broadcast TV (39%). The study underscores YouTube's dominant role in children's media consumption and its impact on their buying preferences. [Retail Wire]

Saks owner to buy Neiman Marcus, source says. The parent company of Saks Fifth Avenue has agreed to purchase rival Neiman Marcus for $2.65 billion, as reported by Reuters and the Wall Street Journal. This merger is expected to enhance the luxury retailers' negotiating power with vendors. Amazon and Salesforce will take minority stakes in the new combined entity, to be named Saks Global, and provide technological expertise. The deal comes amid a slowdown in luxury retail demand post-pandemic, with U.S. consumers becoming more cautious about high-end purchases. The boards of both companies have approved the transaction, and an announcement is expected soon, with Marc Metrick, CEO of Saks's e-commerce business, set to lead the new company. [Reuters]

AI drive-thru ordering is on the rise ā€” but it may take years to iron out its flaws. Restaurants are increasingly turning to artificial intelligence for drive-thru ordering to reduce labor costs, but widespread adoption of this technology is likely years away. According to a National Restaurant Association survey, 16% of restaurant operators plan to invest in AI, including voice recognition, with large chains leading the charge due to their financial capacity and scale. Rising labor costs, exacerbated by the pandemic and recent wage hikes for fast-food workers in California, have driven this shift. While AI tools like ChatGPT have generated excitement, the restaurant industry traditionally adopts new technologies slowly, focusing initially on automating back-of-the-house tasks. [CNBC]

Black farmers call on Tractor Supply CEO to resign following diversity about-face. John Boyd, president of the National Black Farmers Association, has called for the resignation of Tractor Supply's CEO following the company's decision to retract its diversity and climate initiatives. This decision, influenced by customer feedback and social media backlash, has disappointed Black farmers and other underrepresented communities who had seen hope in these commitments. Despite Tractor Supply's claim to uphold its mission and values, the NBFA feels the company has let down a significant portion of its customer base. [Retail Dive]

Walmart has held talks to sell its shuttered medical clinics, Fortune reports. Walmart is in discussions to sell its shuttered medical clinics, according to a Fortune report citing multiple sources. In April, Walmart decided to close all 51 of its health clinics and end its virtual healthcare operations, deeming them unsustainable. Talks have included potential buyers such as health insurance companies, including Humana. It remains unclear if any negotiations are ongoing, but Walmart is looking to recoup some of its investment through a sale or takeover arrangement. Additionally, Walmart recently sold its virtual care subsidiary MeMD to healthcare technology startup Fabric for an undisclosed amount. [Reuters]

Nike CEO John Donahoe comes under fire as stock sees worst day on record. Nike CEO John Donahoe is facing criticism as the company's stock experienced its worst day on record. After Nike announced that current quarter sales are expected to decline by 10%, far exceeding the projected 3.2% drop, shares closed 20% lower on Friday. This decline followed Nike's slowest annual sales growth in 14 years, excluding the pandemic period, and a forecast that fiscal 2025 sales would decrease by mid-single digits rather than grow. The stock plunge wiped about $28 billion off Nike's market cap, reducing it from $142 billion to just under $114 billion. [CNBC]

Will a New Amazon Discount Section Compete With SHEIN and Temu? Amazon is introducing a new discount section in its online store featuring goods shipped directly from warehouses in China, shifting from its traditional model of U.S.-based warehouse shipments. This move aims to compete with platforms like SHEIN and Temu, which attract shoppers prioritizing cost savings over fast delivery times. By shipping directly from China, Amazon can reduce unsold inventory and streamline its supply chain, catering to a price-sensitive demographic with competitive pricing. [Retail Wire]

Microsoft consolidates retail channels in China. Microsoft is consolidating its retail channels in mainland China, responding to media reports about closing its network of authorized physical retailers in the region. While Microsoft did not confirm or deny the closures or specify the number of affected stores, it stated that the decision is part of a strategy to better meet customer needs. Microsoft products will still be available in China through its retail partners and its own website. The company does not operate physical retail stores directly in China and did not provide details on which partners will continue to stock its products. [Reuters]

What Drives Consumer Behavior on the Fourth of July? Consumer behavior on the Fourth of July is driven by a mix of patriotic enthusiasm, tradition, and seasonal activities, making it a significant shopping event for retailers. According to the National Retail Federation, 87% of consumers plan to celebrate Independence Day, while Numerator estimates a slightly lower participation at 73%. Key activities include spending time with family and friends (58%), grilling or barbecuing (56%), participating in public events (31%), preparing food at home (26%), and hosting gatherings at their residence (18%). Retailers capitalize on this holiday by offering products and promotions that cater to these festive and social activities, much like other major holidays throughout the year. [Retail Wire]

Parents to spend nearly 22% more on back-to-school shopping this year. Parents are expected to spend nearly 22% more on back-to-school shopping this year, with Walmart, Target, and Amazon remaining the top shopping destinations, according to a JLL survey. Wealthier households (earning over $150,000) are increasing their budgets the most, while parents earning over $50,000 are not cutting back despite inflation concerns. Lower-income parents (earning less than $50,000) are reducing their budgets, seeking sales, and starting their shopping in July or August, whereas higher-income parents are starting in early June and opting for private label products to save money. [Retail Dive]

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