These 4 Companies LOVE Wedding Season
Springtime means the official start of wedding season, that glorious spell extending roughly from April to October when beaming brides-to-be get a shine in their eye for all things wedding-related.
Market research specialist IBISWorld puts the size of the wedding industry and related services at a whopping $50.6 billion. As consumers expand their disposable incomes again, the wedding industry is expected to grow by 2.3 percent over the next five years, IBISWorld forecasts.
From dresses to engagement rings, to household registries and honeymoon vacations, this means big business for the companies that cater to this industry, fostered by shows like Say Yes to the Dress on Discovery Communications' TLC channel and Pinterest wedding boards (a growing number of single females are even creating "secret" boards dedicated to weddings and baby).
Building on its high-end merchandise and attention to the personalized customer experience, Nordstrom launched The Wedding Suite in 2010. The boutique, which is in 18 of Nordstrom's roughly 240 full-line stores across the U.S., as well as online, offers both off-the-rack and customizable merchandise collections from some of the hottest designers for brides, grooms and their wedding parties.
The Wedding Suite is meant to compete with high-end bridal salons and complement the Seattle-based company's fashion-forward offerings, by providing bride and bridal party apparel and accessories by high-end wedding designers such as Vera Wang, Monique Lhuillier, Amsale, and others, as well as personalized attention through appointment-only wedding stylists.
Nordstrom is also offering personalized services, such as on-site tailoring and alterations, bra fitting and lingerie specialists, beauty services, garment steaming, shoe shining and free shipping on orders placed through its wedding stylists.
"We knew there was a bridal customer coming to our stores and Web site and we wanted to make shopping easier and more fun for her," wrote Andrea Wassermann, Nordstrom's national bridal director, in an emailed response to questions. "So we built out special spaces for the bride and her wedding party and filled them with head-to-toe looks. They're staffed by dedicated Wedding Stylists who shop the whole Nordstrom store for fashion from engagement party through honeymoon."
Nordstrom has recently introduced "Bridesmaid Bars" in an additional 29 locations to cater to bridesmaid dresses.
The company does not break out the contribution of The Wedding Suite to overall revenue. Nordstrom posted record net sales in 2012 of $11.8 billion and said that same-store sales rose 7.3 percent year-over-year. Nordstrom reports fiscal first-quarter earnings on May 16.
Nordstrom's stock hit a new 52-week-high of $59.01 on Wednesday. Shares are up 11 percent this year.
Bed Bath & Beyond is one of the most popular home furnishing retailers for wedding gift registries.
Couples can load up their registries with Caphalon pans, Keurig machines, and Egyptian cotton duvet covers. Like Nordstrom, the company has expanded its product merchandise to become a full-service destination for consumers' wedding needs, including invitations, accessories for the ceremony like satin ring pillows and porcelain cake toppers for the reception.
The wedding gift market topped $10 billion in 2011, according to a separate survey by XO Group. The survey interviewed more than 12,000 engaged couples across the country.
Interestingly, the survey found that the average gift registry is worth $5,158, with 42 percent valued at above the $5,000 mark, with bakeware and kitchen appliances as the most popular items on a registry.
Bed, Bath & Beyond saw net sales rise 15 percent to $10.92 billion in 2012 (the fiscal year which ended on March 2, 2013). Full-year earnings per diluted share rose 12 percent year-over-year to $4.56, the company said.
Comparable store sales for fiscal 2012 increased by approximately 2.7 percent.
The company will report first-quarter earnings on June 26. Bed Bath & Beyond expects to post earnings between 88 cents and 94 cents a share for the quarter.
Bed Bath & Beyond shares are up 24 percent this year.
3. XO Group
Internet company XO Group was started in the mid-1990s by David Liu and Carley Roney, a husband and wife team that saw a big opportunity for a wedding planning resource. The company's flagship brand, The Knot, has expanded to include resources for new homebuyers and parents through its two other brands, The Nest and The Bump. The company also includes WeddingChannel.com, which it acquired in 2006, and its wedding site in China, ljie.com.
The company's three lines of business are—merchandising, which includes the publication of books, videos, wedding planners and other e-commerce, ad sales and sponsorships, and registry services.
While the New York-based company faces competition from social media sites like Facebook and Pinterest, as well as more direct competitors like Martha Stewart Living Omnimedia, its flagship site, The Knot, has strong brand awareness.
XO Group reported first-quarter earnings on Thursday. The company posted a profit of $1.7 million, or 7 cents per diluted share on revenue of $30.3 million. Analysts had expected the company to post earnings of 6 cents a share on revenue of $31.3 million.
"We are pleased with the strength in our advertising businesses this quarter, with strength across all platforms online and offline. However, we believe we still have a lot of opportunity to drive total revenue growth," CEO David Liu said in the earnings release. "Our teams are working tirelessly to create new products, tools, and services across our brands and platforms. To this end, we recently launched our mobile optimized e-commerce site, and in the coming months we plan to roll out additional products which will connect our brides, newlyweds, and new parents with the relevant retailers and vendors during the critical 'five years of firsts' life stages."
Shares of XO Group have risen 27 percent in 2013.
The company has been buying back stock. XO Group authorized on April 10 an additional repurchase program of up to $20 million of common stock. As of March 31, the company had cash and cash equivalents totaling $74.9 million.
Parent company to the popular national jewelry chains, Kay Jewelers and Jared The Galleria Of Jewelry (it also runs two jewelry chains in the U.K.), each with their own signature television advertisements, Bermuda-based Signet seemingly has a heavy hand in the engagement ring and wedding band market.
Shares of Signet Jewelers have risen 31 percent in 2013, driven in part by the rebound in consumer spending on discretionary items.
As of February, the company had a total of 1,954 stores, the majority of which are in the U.S. It also completed the acquisition of 140 Ultra jewelry stores in the U.S. last year for $57 million in cash, which is expects to start being accretive to earnings in its fiscal first quarter.
For its fiscal 2013, Signet saw a 3.3 percent increase in same-store sales and a 16.6 percent increase in earnings per share, it said in March.
The company attributed the results to strong customer service, merchandise offerings, the Ultra acquisition and continued advertising investment in stores. ("Every Kiss Begins With Kay," and "He Went To Jared," are two of the catchiest jingles on television.)
The company expects same-store sales for the first quarter 2014 to be between 5 percent and 7 percent. It expects diluted earnings per share in the range of $1.07 and $1.12. It plans to increase capital spending to between $180 million and $195 million, which "supports new stores, remodels, the Ultra integration, and multi-channel and IT infrastructure investment."
The company expects to open 65 to 75 new stores in the U.S. this year.
Signet report first-quarter earnings on May 23.
—By TheStreet.com's Laurie Kulikowski
TheStreet does not permit any employees on its editorial staff to individually hold positions in individual stocks, though they are permitted to own stock in TheStreet.