How to win over customers in inflationary times.

Hint: It’s not just about price.

August 09, 2024

🎉 Hello, Retailist Roundup readers! As we wrap up another exciting week, the energy in the retail and e-commerce world is palpable. This week has been packed with key updates, emerging trends, and innovative breakthroughs reshaping our industry. Ready to dive into the top stories? Let’s explore these developments and their far-reaching impacts together!

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In the news: Top headlines this week

How Carter’s is pitching kids’ clothes to new Gen Z parents. Carter’s is targeting Gen Z and millennial parents with its new "More Than Just Cute" ad campaign, emphasizing the practical and functional aspects of its children’s clothing rather than just their appearance. The campaign features a 30-second spot that highlights the everyday achievements of infants, aiming to resonate with young parents who value both style and substance in their children’s attire. [Retail Dive]

Nike sees gold rush with summer Olympics driven website visits, sales. Nike has experienced a surge in website visits and sales due to the summer Olympics, benefiting from increased demand driven by high-profile athletic performances. During the first week of the Olympics, Nike and Puma saw a rise in direct-to-consumer site visits, while competitors like Adidas saw declines. Nike’s website visits peaked following significant Olympic victories, with a notable percentage resulting in sales, suggesting continued strong performance if Nike-sponsored athletes continue to succeed. [Reuters]

Walmart Heightens Dorm Room Shopping Experience With Walmart Realm. Walmart has enhanced its virtual shopping platform, Walmart Realm, to offer a more immersive experience for college students preparing their dorm rooms. The upgraded platform allows users to browse and purchase products within virtual 3D environments, featuring five distinct dorm room decor styles and suggestions for beauty and fashion essentials from popular influencers. This one-stop shop aims to simplify the process of finding and coordinating dorm room decor and essentials. [Retail Wire]

Why ‘wardrobing’ retail fraud soars in the summer. During the summer, a form of retail fraud known as "wardrobing" increases, where customers buy expensive items, use them, and then return them for a refund. This practice spikes between July and September, particularly for swimwear, with returns rates growing two to three times higher during this period. Retailers face difficulties managing these returns, as 30% of shoppers admit to buying items for specific events and returning them afterward. [CNBC]

Costco is leaning into its Netflix-style membership crackdown. Costco is expanding its use of ID scanners across its U.S. warehouses, requiring members to scan their physical or digital membership cards before entering. Despite this increased reliance on technology, Costco assures that employees will remain at the door to assist customers and provide a personal touch. [Business Insider]

The Container Store sales fall 12% in Q1. The Container Store experienced a 12% decline in sales for Q1, with online sales dropping nearly 26%. Despite a strong performance in their custom spaces business, attributed to successful new product launches, the overall results indicate significant struggles, with sales down nearly 31% compared to the same period in 2022, leading to further financial losses. [Retail Dive]

Shopify soars as AI focus powers quarterly beat, bullish forecast. Shopify's stock surged over 20% after the company exceeded second-quarter earnings expectations and issued an optimistic sales forecast, driven by the success of its AI-powered tools. The Canadian e-commerce platform attracted more merchants with its enhanced features, marking a significant rebound from earlier declines. This positive performance comes amid a challenging macroeconomic environment, boosting investor confidence. [Reuters]

This small business founder won't sell on Amazon. Kate Assaraf, founder of the hair care brand Dip, has chosen not to sell her eco-friendly bar shampoos, conditioners, and body washes on Amazon, despite the platform's extensive reach. Instead, Assaraf prefers other sales channels to maintain control over her brand and align with its values of reducing plastic waste. [Business Insider]

Target still struggles to lower virgin plastic use by 2025 deadline. Target has made some progress toward its 2025 goal of reducing virgin plastic use in its own-brand packaging by 20%, but it is still using more virgin plastic than its 2020 baseline. The retailer’s latest sustainability report shows it is lagging behind its target for reducing virgin plastic and making packaging recyclable, compostable, or reusable, though it has maintained progress in increasing the use of postconsumer recycled materials. [Retail Dive]

Ralph Lauren beats profit estimates on stable demand in Europe, China. Ralph Lauren exceeded first-quarter profit estimates, driven by strong demand for its high-end apparel in Europe and China, despite weaker sales in the U.S. The company faced a 4% revenue decline in North America due to cautious inventory planning and slower digital sales but anticipates a moderation in these declines as it adjusts inventory to meet demand for its core products. [Reuters]

How to win over customers in inflationary times. Hint: It’s not just about price. In inflationary times, winning over customers involves more than just offering lower prices; quality and value considerations are also crucial. While budget-focused retailers have benefited from cautious spending, many others have struggled, prompting them to rely on discounts and private labels. However, research indicates that consumers are still evaluating purchases based on quality and overall value, not just cost. [Retail Dive]

‘Shark Tank’ Alum Wins Big at Target With Sustainable Diaper Brand Kudos. Amrita Saigal, a “Shark Tank” alum, has achieved significant success with her sustainable diaper brand, Kudos, now available at Target. Kudos stands out in the crowded diaper market by using 100% cotton lining and biodegradable materials like sugarcane and trees, following the trend of successful products featured on the show. [Retail Wire]

Under Armour chief consumer officer exits as 26-year Adidas veteran joins the brand. Under Armour's Chief Consumer Officer, Jim Dausch, is leaving at the end of the month, and Eric Liedtke, a former Adidas brand president, is joining the company to lead brand strategy. Liedtke will oversee global brand and marketing initiatives, aiming to enhance Under Armour's brand identity and drive growth, while Dausch’s departure follows a series of leadership changes at the company. [Retail Dive]

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