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Facebook announced a cryptocurrency

The BBC reported that Facebook is finalising plans to launch its own crypto-currency next year, with plans to set up a digital payments system in about a dozen countries by the first quarter of 2020. The social media giant wants to start testing its crypto-currency, which has been referred to internally as GlobalCoin, by the end of this year. Facebook is expected to outline plans in more detail this summer, and has already spoken to Bank of England and sought advice on operational and regulatory issues from officials at the US Treasury. The firm is also in talks with money transfer companies such as Western Union as it looks for cheaper and faster ways for people without a bank account to send and receive money.    

Shoppers addicted to online discounts

The AFR reported that Australian shoppers are still addicted to discounts, which augers poorly for retailers such as Myer who are trying to wean customers off price-based promotions. Almost seven in 10 Australians say they always look for sales or discounts when buying online, according to PayPal's latest mobile commerce report. Younger shoppers are even more inclined to chase a bargain according to the report, with 77% of Generation Z and 73% of Generation Y shoppers saying they're constantly looking for sales. About 50% of shoppers wait for products to go on sale before they buy online, with Generation Z, at 73%,  and Generation Y, at 65%, the most price savvy. The figures underline the difficulty facing retailers attempting to protect profit margins by cutting back on discounting. The report suggested the demand for discounts exceeded retailers' appetite to cut prices, quite obviously.

Kohl's drives footfall using its stores as depots for Amazon returns

The AFR reported that US department store Kohl's is driving footfall by using its stores as depots for Amazon returns. About 30% of online sales are returned and Amazon has tapped Kohl's to act as part of its returns operation, which the retailer is capitalising on. One Chicago-area Kohl's store accepts more than 1,000 returns a day, and its stores in the region had a 9% increase in new customers last year. In contrast, Kohl's locations in other parts of the country that didn't accept Amazon returns only recorded a 1% increase. Sales growth at the Chicago-area stores also outpaced their Amazon-less counterparts. Goes to show the power of thinking laterally in this new world of retail.

Big US retailers sales stall as they brace for tariffs

The Wall Street Journal reported that sales at several major US chains slowed during the latest quarter, clouding the outlook for the retail sector as it braces for the impact of higher tariffs and merchandise imported from China.  Khols, J.C. Penny and Nordstrom reported declines last week, while Home Depot posted a weaker than expected rise in comparable store sales. Earlier this month, the Trump administration imposed a 25% tariff on US$200 billion in Chinese goods, up from a 10% duty put in place in October. Generally, large retailers are better positioned to extract price cuts from suppliers or spread increases strategically across all the items they sell to mitigate the impact on sales. But, overall, the US-China trade war has left American shoppers unscathed, as major consumer categories, including toys and apparel, have eluded tariffs so far.

Topshop operator files for bankruptcy in the UK

The Wall Street Journal reported that Arcadia Group, a London-based fast-fashion retailer and operator of the Topshop and Topm brands, filed for bankruptcy in the US, citing many of the same challenges facing much of the broader retail industry. The Group plans to exit its US operations and begin liquidating inventory in its US stores as soon as this weekend. The US filing follows a separate insolvency process Arcadia began in the UK last week, where it is considering closing 23 of its locations in the UK and Ireland and is seeking better lease terms for another 194 sites. According to Arcadia representatives, the company is facing increasing switch from in-store to online shopping and an aggressive discounting environment as retailers compete for customers, and high-levels of product returns.

Marks and Spencer to close 100 stores by 2020

The Retail Gazette reported that Marks and Spencer has said it is focusing on closing down 100 outlets by the end of next year, speeding up its store closure scheme by two years. The British retailer initially aimed to shut 100 stores by 2022, and has closed 14 stores since the end of March, making a total of 63 closures in just over two years. The news follows M&S chairman and chief executive anticipating a drop in annual profits when it releases its full-year results on Wednesday. In the 13 weeks to December 29, total UK sales declined by 2.7% to £2.7 billion. M&S is reportedly eyeing job cuts in its clothing and home teams as it aims to simplify operations. Over 1,000 people currently work in M&S’s clothing and home teams.

Is rent-ail the future of retail?

The Hustle reported that Home Depot announced plans to double down on tool rentals to cater to pro builders and boost sales. Earlier this week, Urban Outfitters launched an online subscription service that will allow customers to rent up to 6 items per month before swapping them out for new threads. As traditional sellers embrace rentals, they raise the question: Is rent-ail the future of retail? The equipment rental market is expected to grow to US$60 billion by 2021, and the online clothing rental market, virtually nonexistent before Rent the Runway, is expected to grow from US$1 billion in 2018 to US$2.5 billion by 2023. These growing markets are great opportunities for rent-ailers to build giant catalogs of popular products and revamp sluggish sales. Renting provides value to some consumers - namely, the ones looking for specific, expensive products they won’t use much, like power tools or stylish dresses. But, for the majority, the deals can end up being wildly expensive.

Best Buy rides the web to lift sales

The Wall Street Journal reported that electronics retailer, Best Buy's profit rose in the latest quarter as growing online sales of appliances and electronics offset flat sales in stores. Best Buy's comparable sales increased 1.1% in the first quarter ended May 4, slower than previous periods but the ninth consecutive quarter of growth. The company has undergone a striking turnaround in the last five years, defying the fate that has befallen Circuit City, Sports Authority, Toys "R" Us and other so-called category killers. Best Buy has implemented a template for competing in an Amazon-dominated segment, matching prices, adding services and using its stores to fulfill online orders. Most recently, it has actually struck a partnership with Amazon to sell smart TVs.

Reject Shop in the red, CEO departs

The AFR reported that a series of blunders around product lines, randing and pricing have seen like-for-like sales drop 2.9% in the second half at The Reject Shop, costing CEO Ross Sudano his job. Chairman Bill Stevens says the business is squeezed in a vice between relentless discounting of the big supermarkets and intense competition. Stevens also says The Reject Shop is being hurt by falling foot traffic, with shopping centres spending big on refurbishments without success (maybe they should be spending big on parking rather?). Despite the poor performance, Stevens says he has no regrets about rejecting a $78 million takeover offer from packaging mogul Raphael Geminder, even though the retailer's value has fallen 23% since the offer closed. Reject Shop shares fell 6% to $2.13 on Thursday. It is set to lose more than $10 million in the June half. makes headlines for the wrong reasons, again

The AFR reported that analysts say’s brand is likely to take a hit from allegations the online retailer offered fake discounts to consumers in a tax-time promotion last year. The ACCC alleges raised the prices of more than 600 products by at least 10% immediately before offering 10% discounts last June. The ACCC has instituted proceedings against Kogan in the Federal Court, alleging the company, run by co-founder Ruslan Kogan, made false or misleading representations about the promotion, breaching the Australian Consumer Law. Kogan denies the allegations. It is not the first time Kogan has been in strife with the competition regulator for making false and misleading statements. In January 2016, it paid $32,400 in penalties for a misleading Father’s Day promotion. True or false, the news is not good for Kogan's brand sentiment.  

50 retail innovation stats


Forbes reported on "50 retail innovation stats that prove the power of Customer experience". These statistics show the changing retail landscape and just how much customers depend on personalisation, convenience and great relationships with brands. For example, in 2018, 51% of e-commerce brands offered same-day delivery, up from 16% in 2017. Experts predict that within the next two years, 65% of retailers will offer same-day delivery. 87% of consumers begin their shopping journey with digital, a jump from 71% in 2017. 77% of consumers say discounts influence where they shop, and 48% say discounts can speed up their decision-making process. The majority of customers (58%) say their top reason for leaving a shopping cart is high shipping costs. Check out the full list here.


US retail's winners and losers

CNBC reported that Target’s CEO thinks the retail industry is shaking out to show clear winners and losers. Target shares soared more than 9% Wednesday, on the heels of the retailer’s upbeat results. Its stock is up over 8% so far this year, bringing its market cap to roughly US$39.8 billion. Rival Walmart also recently delivered strong first-quarter results. Its shares were climbing about 0.5% Wednesday morning, having jumped about 8.5% so far this year. It’s US department store chains, however, that seem to be ceding market share, as they’ve been called out for taking too long to make investments in their bricks-and-mortar stores and websites. Kohl’s shares are down about 10% over the past 12 months, while J.C. Penney shares have fallen 55%, Macy’s shares are down 35%, and Nordstrom’s stock has dropped roughly 25% from a year ago.