source: smartplanet

source: SteelHouse

Total net sales for the 19 chains we track (drug stores won’t report until next week) increased 5.6% from a year ago to $22.39 billion in May, while same-store sales rose 4.1% on top of a 6.5% gain last year – this was the 33rd straight monthly rise after 12 consecutive months of declines.

For the first 5 months of 2012, total sales increased 6.7% to $111.4 billion and comparable store sales rose 5.2% on top of a 6.1% gain in 2011.

According to the National Retail Federation, May is the fourth-biggest month of the year, bolstered by Mother’s Day, high school and college graduations, and the bridal season. In addition, unseasonably warm weather across much of the country continued in last month, helping to drive foot traffic to stores.

Shoppers spent early and often to start the year, driven by extremely warm temperatures and a much earlier Easter than last year. Following a prolonged post-Easter slowdown, spending picked up in May as consumers responded to Mother’s Day and Memorial Day promotions, as well as 8 consecutive weeks of falling gas prices.

Strength was broad-based, with 17 of the 19 chains reporting comp gains and 69% beating analyst estimates.

Leading the gains, as usual, were off-price stores TJX and Ross Stores, both of which saw comps rise 8% in May, significantly better than analyst estimates for a 5.3% gain.

Macy’s (+4.2%) and Target (+4.4%) both continued their positive momentum in May, likely benefiting from customer defection at JC Penney in light of its restructuring efforts.

Limited Brands (+6%), Zumiez (+13.7%) and Stage Stores (+8%) rounded out the top gainers, with each handily beating expectations.

Wet Seal (-8.8%) and Kohl’s (-4.2%) were the only chains to report negative comps and both missed consensus estimates. Kohl’s CEO Kevin Mansell said “May sales were lower than our expectations and, as a result, we now expect second quarter comparable store sales to be modestly negative.” He added that hed expects lower inventory to hinder sales until the Back-to-School season.

Though the strength in May was impressive, especially considering the tough comparisons to last year, we expect spending to moderate heading into back-to-school season. Most confidence measures have receded from post-recession highs, with consumers increasingly worried about job and economic growth.

“While the recent decline in gasoline prices and slower pace of initial claims may have bolstered consumer comfort over the past week, overall sentiment remains in the doldrums,” said Joseph Brusuelas, a senior economist at Bloomberg LP in New York. “Given the looming crisis in Europe and the weak pace of hiring in the economy, risks to the consumer outlook remain elevated roughly midway through 2012.”

However, sales trends were relatively weak throughout the month of May. Eight consecutive weeks of declines in gas prices, Mother’s Day and Memorial Day holidays and warmer temperatures were not enough to entice discretionary spending, as consumers are increasingly concerned about slowing economic growth.

“Consumers have been more pessimistic on many fronts during the month of May as the financial worries in Europe clearly have spilled over and weakened consumer confidence in the U.S. as the U.S. financial markets have retreated as well on increased global worry,” said Michael Niemira, ICSC’s vice president of research and chief economist. “Given this, retail sales followed suit and retreated throughout the month of May.”

As always, we will have full coverage of monthly sales tomorrow morning.

Wednesday’s Top Retail & Consumer Reads:

• The emerging trillion-dollar market for health and wellness (McKinsey & Co)
• Apple’s Biggest Threat in Mobile Ad Space is Amazon (AdAge)
• Study says mobile marketing has eight times the response rate of email (Luxury Daily)
• Banana Republic’s first co-branded collections help lead resurgence (Bloomberg)
• Retailers perk up customer loyalty programs (SmartMoney)
• Coinstar retools vending machines with a tech twist (Seattle Times)
• Consumer Confidence Index plunged in May on moderating economic growth (Conference Board)
• Kohl’s is practically the poster child for successful retailing, so where did it all go wrong? (Robin Report)
• Retailers perk up customer loyalty programs (SmartMoney)
• Maidenform Uses Augmented Reality To Debut New Brand (MarketingDaily)
• How in-store shopping principles drive omnichannel retail (Retail’s BIG Blog)
• Thrillist’s flash-sale site JackThreads hits 2 million members (TechCrunch)
• Despite More Spending Power Than Ever, Boomers Still a Marketing Wasteland (AdAge)
• New ‘experience-based’ Body Shop keeps shoppers in store (Globe and Mail)
• Every Marketing Decision Begins & Ends With The Shopper (SymphonyIRI)

source: Multichannel Merchant

source: IBM

sourc: NielsenWire

The common refrain from retailers this past quarter was a strong start to the year driven by unseasonably warm weather and the early Easter, followed by a significant drop-off post-Easter through the end of April.

Shoppers splurged earlier than usual on spring merchandise, and with a stagnating job market and teetering stock market, have curbed spending on all but necessities.

Gas prices have declined for 7 straight weeks, somewhat easing the burden on household balance sheets, but unfortunately consumer confidence has followed suit.

“The lagged impact of rising food and fuel prices early in 2012 and a slower pace of hiring amid a decelerating economy are the likely culprits behind the near reversal of gains in consumer comfort observed through the first quarter,” said Joseph Brusuelas, a senior economist at Bloomberg LP in New York. “The ability of the household to reassert its place as the primary driver of growth during the current business cycle remains limited due to modest job growth and incomes.”

According to ICSC, chain store sales have decreased for 4 consecutive weeks and 5 out of the past 6 weeks. “Consumers seemed to take a ‘time out’ despite the abnormally warm temperatures throughout the nation and receding gasoline prices,” said Michael Niemira, ICSC’s vice president of research and chief economist.

He noted that Memorial Day may spark a positive end to May, but with a less than impressive turnout for Mother’s Day we are not as optimistic.

Tuesday Retail & Consumer Reading List:

• Luxury-Crazy Chinese Fuel Soaring Retail Rents In Hong Kong (Bloomberg)
• Online retailer Bonobos moves offline to provide more personal service (PSFK)
• E-Commerce in China: How the World’s Biggest Market Buys Online (Mashable)
• Macy’s 2.0 Sales Strategy Puts Pedal to the Metal in Digital (Forbes)
• Digital Goes Offline: Can Brands Take Back The Store? (Adotas)
• J. Crew and the Man Who Dressed America (The Record)
• Overall U.S. Retail Real Estate Market Recovery Remains Modest (Jones Lang LaSalle)
• How Moosejaw’s marketing madness wins over Gen Y (MarketingDaily)
• Infographic: Shopping Cart Abandonment Rate Statistics (Invesp)
• Study Finds Giant Food & ShopRite Are Consumers’ Favorite Grocers (Market Force)
• Is online shopping better for lowering carbon footprint than going to the store? (FastCoEXIST)
• Home Depot vs Lowe’s: The Fight for Head of Household (Denver Post)
• Retail Landlords Sigh in Relief as Leasing Activity Gains Momentum (Retail Traffic)
• New Study Reveals Freebie Promotions Motivate Sales (iYogi Insights)
• Walmart tops list of world’s most valuable retail brands (Retailing Today)

source: Invesp

source: Fast Company