With 1st quarter earnings season nearly halfway through, it’s becoming quite clear the post-Easter slowdown witnessed in April was far more than just the result of a calendar shift.
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
