NORTHBROOK, Ill., Dec. 1, 2014 (GLOBE NEWSWIRE) -- Despite slower traffic and softer retail sales this past weekend - the official kick-off to the holiday shopping season - 82 percent of top executives are still expecting topline sales this holiday shopping season to be the best in years, according to the newly released 2014 Retail Executive Survey – Holiday Trends Report, conducted by the Hilco Global Retail Group and its independent Hilco Retail Board of Advisors. The survey also identified specific strategies retailers are implementing looking into 2015, such as enhancing the in-store shopping experience, expanding online, digital and social media initiatives and more. The survey gleaned perspectives and opinions from C-Suite executives at some of the world's leading retail companies with sales of $250 million or more, and indicated optimism for year-over-year sales gains this holiday season.
Holiday sales have steadily increased each year since the Great Recession of 2008, with the average annual sales gain at 2.9%. This year, the National Retail Federation (NRF) and the International Council of Shopping Centers (ICSC) are both looking for the first 4% holiday sales gain since 2011, a view also validated by this new survey.
According to this new survey, the strongest growth in retailing this season will come in four sectors – department stores, apparel stores, consumer electronics/mobile devices and health, beauty and personal care stores.
Despite the optimistic outlook for the 2014 holiday shopping season, the C- Suite retail executives in the survey also voiced a number of concerns. "While the C-Suite respondents predict better overall sales results compared to the last several years, they remain apprehensive about the stability of the industry as a whole, in particular the brick and mortar channel," said Antony Karabus, CEO of HRC Advisory, the retail consulting unit of Hilco Global. "Although the US economy has shown improvement, retailers are leaving little to chance, inspiring many to put specific strategies and tactical plans in place to protect market share now and in 2015, which include discounting, improving the in-store experience and enhancing digital, social media and online activity," added Karabus.
Over two thirds of the executives surveyed ranked their top five significant challenges for this year's holiday season as:
1. Addressing fierce competitive threats (78%)
2. A weaker than anticipated economy (75%)
3. The impact of deep discounting on profit margin (75%)
4. Continued erosion of in-store sales to online channel (61%)
5. Ordering and maintaining correct inventory levels (55%)
Other key findings from the survey include:
• 2014 Holiday Discounting: it's the "new normal"
Retailers don't like discounting, yet 65% feel they must continue to rely heavily on this tactic as a means to maintain market share, reduce the amount of excess inventory, and increase in-store traffic. "Super-discounting" on unique, limited stock items will be used to drive traffic during key shopping timeframes, not just on Black Friday or Cyber Monday.
"Discounting will continue to be even stronger this holiday season due to lackluster sales in the most recent quarters," said Greg Apter, president of Hilco Real Estate. "Retailers are discounting to protect market share and they are using it as a way to bring customers into their stores in hopes of upselling and educating them on other, unique pieces of merchandise. We also expect heavy discounting during periods other than Black Friday to get customers into stores earlier and throughout the remainder of the year."
• December 2014 and 2015 Emphasis: improve the "in-store experience"
To improve in-store traffic and conversion, retailers will work to make the store environment more convenient, easier to navigate and discover products, easier to checkout, easier to obtain advice and sales support and ultimately, easier to buy.
Improvements in employee staff training and customer service experiences will be evident this holiday season. Retailers will engage with their customers through more interactive displays, customer events, sampling and "one-of-a-kind experiences," according to the survey.
Survey respondents also believe that bringing digital capabilities into stores to better serve customers is key to creating a more convenient and more relevant store experience. Broad uses of self-checkout systems and stations, virtual sizing and virtual dressing rooms and tactics like purchase online and in-store pickup will be employed this season.
"The commitment to in-store activity is very exciting and is really moving retailers into the next generation of selling," said Farla Efros, COO of HRC Advisory, the retail consulting unit of Hilco Global. "Retailers are working hard to overcome 'showrooming' issues with new experiences, such as 'Endless Aisle' shopping. Large, interactive touch screens and mobile devices featuring endless product information, special deals and merchandise are now occupying more in-store space. As shoppers engage with virtual shelves, store aisles become digital shelves. 'Endless Aisle' and virtual merchandising technologies also allow retailers to drop-ship products not available in stores to customer homes or other locations."
• 2015 Investments: more extensive "data-based marketing" via online, digital and mobile tools
Investments in data gathering, mining capabilities and technology will also be increased to capture new customers and further solidify relationships with current customers starting this holiday shopping season and into next year. Retailers are investing in technology that unlocks the value of mobile phones and tablets as a means of converting sales.
Through mobile devices such as the new Apple iPhone 6 and other smartphones, retailers will expand loyalty programs, increase bounce back couponing and accept payments via new systems like ApplePay. The use of geo-tracking systems and social media to execute special limited time offers is expected to increase as well.
Digital retail expert Elaine Rubin, president of Digital Prophets Network and a member of the Hilco Retail Advisory board said, "after several seasons of huge smartphone growth and usage, retailers are realizing that mobile, specifically smartphones, have fundamentally changed consumer shopping behavior in all stages of the purchase path; awareness, consideration and intent. While mobile sales will naturally continue to grow and become a larger percentage of ecommerce and overall retail sales, retailers are beginning to think more broadly about how to best integrate mobile into all parts of the business from advertising, targeted marketing, in-store experience, associate capabilities, operations and direct commerce."
In addition, a majority of retailers plan on employing one-to-one marketing initiatives to help increase engagement with customers. According to the survey, 95% plan to use social media to execute this strategy, 58% plan on using mobile apps and 35% will use instant chat.
For more details on this survey, additional insights from retail executives and specific retailer proof points and examples, view the full survey report at HilcoGlobal.com.
The 2014 Retail Executive Survey – Holiday Trends Report, as conducted by the Hilco Global Retail Group and its independent Hilco Retail Board of Advisors, gleaned perspectives and opinions on key, current trends from 70 corporate executives at national retailers with more than $250M in revenue. Respondents came from sectors from across the retail spectrum, with the heaviest concentration in clothing, department stores and health/personal care. Online polling methods were utilized in November 2014 by Lumeric Consulting LLC, an independent market research firm, on behalf of Hilco Global.
About the Hilco Advisory Board of Directors
The board is composed of retail leaders with significant experience in retail business, investment banking, financial planning, digital e-commerce and retail talent management. The Advisory Board, together with executive managers at Hilco Global Retail Group, supports retailers and the capital markets by identifying and providing transformational strategic and operational guidance. Members of the 2014 Advisory Board are as follows:
• Al Ferrara – Partner and National Director, Retail Practice, BDO USA
• Hal Reiter – Chairman & CEO, Herbert Mines Associates
• Elaine Rubin – President, Digital Prophets Network LLC; Former executive, Amazon, SHOP.org and 1-800-Flowers
• Joel N. Waller – Retail Executive, Joshwa Investments; Former CEO, Wet Seal, Wilsons Leather and Christopher & Banks
• Michael Keefe and Cory Lipoff – Hilco Merchant Resources
• Antony Karabus and Farla Efros – Hilco Retail Consulting
• Tom Greco and Tim Anderson – Hilco Valuation Services
• Greg Apter and Neil Aaronson – Hilco Real Estate
• Edward Siskin and Jack Butler – Hilco Global
• David Peress – Hilco Streambank
About Hilco Global Retail Group
Headquartered in the Chicago area, the Hilco Global Retail Group specializes in providing financial and operational services to retailers and the companies that support them, including lenders, equity investors and investments bankers. Core competencies include asset valuation, monetization and advisory services, which are provided by specialized business units.
Through these specialized business units serving retail clients, Hilco Global provides a range of integrated solutions including asset appraisal, inventory acquisition and disposition, real estate repositioning and renegotiation, strategic advisory and operational consulting and strategic capital equity investments.
CONTACT: Gary Epstein CMO Hilco Global firstname.lastname@example.org 847-418-2712
Source: Hilco Global