Retail Business Market Research Handbook 2015-2016 [16 ed.] 9781577832027, 9781577832201

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Retail Business Market Research Handbook 2015-2016

Richard K. Miller & Associates ————— since 1972 —————

RETAIL BUSINESS MARKET RESEARCH HANDBOOK 2015-2016 16th Edition RKMA MARKET RESEARCH HANDBOOK SERIES

By: Richard K. Miller and Kelli Washington

Published by: Richard K. Miller & Associates 4132 Atlanta Highway, Suite 110 Loganville, GA 30052 (888) 928-RKMA (7562) www.rkma.com

Richard K. Miller & Associates

————— since 1972 —————

RETAIL BUSINESS MARKET RESEARCH HANDBOOK 2015-2016 16th Edition Copyright © 2015 by Richard K. Miller & Associates All rights reserved. Printed in the United States of America. Use of the electronic edition of this publication is limited to internal use within the purchasing organization. The electronic edition may be stored on computers, Intranets, servers, and networks by organizations which have purchased this publication, and those for which an employee has made such purchase. Copies, including multiple copies, may be printed from the electronic edition for use within the purchasing organization. Libraries may store the electronic edition on an archival database or proxy server for access by library users. Governmental agencies purchasing this publication may share the content within the agency or department. Universities and colleges may share the information within their campus, but not with other universities. Membership associations may use the information within their internal organization, but may not distribute to their membership. This publication may not be stored on Internet websites, nor may it be file-shared through the Internet. This publication may not be resold or distributed without prior written agreement with the publisher. While every attempt is made to provide accurate information, the author and publisher cannot be held accountable for any errors or omissions.

ISBN Number (print edition): 9781577832027 ISBN Number (electronic edition): 9781577832201

Richard K. Miller & Associates 4132 Atlanta Highway, Suite 110 Loganville, GA 30052 (888) 928-RKMA (7562) www.rkma.com

CONTENTS

PART I: MARKET OVERVIEW. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 1

RETAIL SALES: U.S.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1 The U.S. Retail Sector. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2 Retail Sales.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2

RETAIL SALES: STATE-BY-STATE.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 2.1 Retail Sales By State. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 2.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

3

RETAIL CENSUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 3.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 3.2 Employment And Establishment Counts.. . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

4

E-COMMERCE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1 Consumer Shopping Online. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2 E-Commerce Spending.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3 Top Online Shopping Categories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.4 Characteristics Of Online Shopping. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.5 Top Online Shopping Sites. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.6 Shopping On Social Sites. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.7 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

27 27 28 29 29 31 31 31

5

MOBILE COMMERCE.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2 Use Of Mobile Devices For Online Purchases. . . . . . . . . . . . . . . . . . . . . . . . 5.3 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.4 Customer Service For Mobile Shoppers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.5 In-Store Mobile. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

33 33 33 34 34 34

6

OMNICHANNEL SHOPPING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2 Customer Preference For Omnichannel Retail. . . . . . . . . . . . . . . . . . . . . . . . 6.3 Cross-Channel Shopping. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.4 Buy Online, Pick Up In-Store. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.5 Catalogs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

36 36 36 37 38 39

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18 18 18 20

7

CHRISTMAS SEASON SHOPPING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2 Holiday Sales and Traffic. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.3 Early Holiday Shopping.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.4 Holiday Online Shopping. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.5 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

41 41 42 42 43 44

8

BACK-TO-SCHOOL SHOPPING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.2 Back-to-School Spending. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.3 Back-to-College Spending. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

45 45 45 46 47

PART II: MARKET LEADERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 9

RETAILERS: LARGEST COMPANIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 9.1 Rank By Revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 9.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

10 E-RETAILERS: LARGEST COMPANIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 10.1 Online Retailers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 10.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 11 E-RETAILERS: CONSUMER FAVORITES.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65 11.1 Favorite 50. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65 11.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 12 RETAIL CUSTOMER EXPERIENCE.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.2 Customer Satisfaction Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

67 67 67 72

13 TOP GROWTH CHAINS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 13.1 Growth Chains. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 13.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75 14 MOST VALUABLE RETAIL BRANDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 14.1 Ranking By 2014 Valuation.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 14.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 15 TOP BRANDS IN SHOPPER SATISFACTION. . . . . . . . . . . . . . . . . . . . . . . . . . . 78 15.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78 15.2 Retailers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

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15.3 Consumer Products. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 15.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 PART III: ANALYSES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 16 AIRPORT RETAIL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.2 Top Airports For Retail. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.3 Duty-Free Retail. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

83 83 84 84 84

17 AUTOMOTIVE PARTS STORES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.2 Market Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.3 Sector Profile. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.4 Customer Shopping. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.5 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

85 85 85 86 86 87

18 BABY PRODUCTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.2 Market Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

88 88 89 89

19 BOOK STORES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.2 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.3 Sector Profile. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.4 Independent Book Stores. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.5 E-Books. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.6 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

90 90 90 91 91 91 92

20 BRIDAL & WEDDING MARKET. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.2 Engagement and After-Wedding Shopping. . . . . . . . . . . . . . . . . . . . . . . . . 20.3 Wedding-Gift Giving. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.4 Wedding Registries.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.5 Millennial-Generation Weddings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

93 93 94 94 94 95

21 CONSUMER ELECTRONICS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97 21.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97 21.2 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98 21.3 Household Use Of CE Products. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98 21.4 Market Forecast. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99 21.5 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100 Retail Business Market Research Handbook 2015-2016

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22 CONVENIENCE STORES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22.1 Sector Profile. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22.2 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22.3 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

101 101 101 102 102

23 CRAFTS & HOBBY STORES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.2 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.3 Market Characteristics and Trends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

103 103 103 104 104

24 DEPARTMENT STORES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.2 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.3 Market Trends.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

105 105 105 106 106

25 DOLLAR STORES & EXTREME-VALUE RETAILERS. . . . . . . . . . . . . . . . . . . 25.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.2 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.3 Market Characteristics and Trends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

107 107 107 108

26 HOME CENTERS & HARDWARE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 26.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 26.2 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111 27 MILITARY EXCHANGES.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27.2 The Army and Air Force Exchange Service. . . . . . . . . . . . . . . . . . . . . . . . 27.3 Navy Exchange Service Command. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

112 112 112 113 113

28 OFFICE PRODUCTS.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28.2 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

114 114 115 115

29 PET SUPPLIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29.2 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

116 116 117 117

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30 PRIVATE LABEL.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30.2 Comparison With National Brands. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

118 118 119 119

31 TOYS & VIDEO GAMES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31.1 Market Assessment: Toy And Game Retail Stores.. . . . . . . . . . . . . . . . . . 31.2 Market Assessment: Toys.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31.3 Market Assessment: Video Games.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31.4 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31.5 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

120 120 120 121 122 122

32 USED MERCHANDISE STORES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.2 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.3 Market Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

123 123 123 124 124

PART IV: APPAREL, FOOTWEAR & ACCESSORIES. . . . . . . . . . . . . . . . . . . . . . . 125 33 MARKET ASSESSMENT: APPAREL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.1 Apparel Specialty Store Spending. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.2 Total Apparel Spending. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.3 Growth Segments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.4 Online Spending. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.5 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.6 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

126 126 128 128 129 129 130

34 MARKET ASSESSMENT: FOOTWEAR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.2 Fashion Footwear. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.3 Brand Focus Studies.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.4 Online Sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.5 Athletic Footwear. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.6 Sector Profile. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.7 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.8 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

131 131 131 132 134 134 134 135 135

35 MARKET ASSESSMENT: JEWELRY.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.1 Jewelry Sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.2 Jewelry Store Sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.3 Sector Profile. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.4 Market Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.5 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

136 136 136 137 137 137

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36 MOST VALUABLE APPAREL & LUXURY BRANDS. . . . . . . . . . . . . . . . . . . . . 36.1 Apparel Brand Valuations 2014. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36.2 Luxury Brand Valuations 2014. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

138 138 138 138

PART V: CONSUMER PACKAGED GOODS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139 37 MARKET ASSESSMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140 37.1 Rank By Sales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140 37.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143 38 LARGEST CPG COMPANIES.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38.1 Largest Companies.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38.2 Top Growth CPG Companies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

144 144 145 145

39 MOST VALUABLE CPG BRANDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146 39.1 Brand Valuations 2014. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146 39.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147 PART VI: DISCOUNT STORES, SUPERCENTERS & WAREHOUSE CLUBS. . . . 148 40 MARKET ASSESSMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40.2 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

149 149 150 150

41 MARKETSHARE BY METROPOLITAN AREA. . . . . . . . . . . . . . . . . . . . . . . . . . 151 41.1 Retail Sales In The Largest MSAs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151 41.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158 42 CUSTOMER PROFILE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42.1 Demographics of Mass Merchant Customers. . . . . . . . . . . . . . . . . . . . . . . 42.2 Warehouse Club Members. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

159 159 160 160

PART VII: DRUG STORES & PHARMACIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161 43 MARKET ASSESSMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162 43.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162 43.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163

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44 LARGEST CHAIN RETAIL PHARMACIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164 44.1 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164 44.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164 45 MERCHANDISE SALES MIX. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165 45.1 Sales Distribution For Chain Drug Stores. . . . . . . . . . . . . . . . . . . . . . . . . . 165 45.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165 46 MERCHANDISE & FOOD SALES IN DRUG STORES. . . . . . . . . . . . . . . . . . . . 166 46.1 Sales at Mass Market Retail Stores. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 166 46.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 168 47 SALES BY METROPOLITAN AREA.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169 47.1 Top 100 Markets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169 47.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171 48 MARKETSHARE BY METROPOLITAN AREA. . . . . . . . . . . . . . . . . . . . . . . . . . 172 48.1 Retail Sales In The Largest MSAs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172 48.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 179 49 STORE COUNTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49.2 State-by-State. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

180 180 180 181

PART VIII: HEALTH, BEAUTY & COSMETICS.. . . . . . . . . . . . . . . . . . . . . . . . . . . . 182 50 MASS MARKET HBC PRODUCTS.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183 50.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183 50.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 184 51 BEAUTY PRODUCTS & COSMETICS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51.1 Cosmetics. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51.2 Prestige Beauty Products. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51.3 Cosmetics and Personal Grooming Products Online. . . . . . . . . . . . . . . . . 51.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

185 185 185 186 187

52 TOP RETAILERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 188 52.1 Top-Ranking O-T-C/HBC Retailers.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 188 52.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 190 53 TOP BRANDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191 53.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191

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53.2 Market Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191 53.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202 54 MOST VALUABLE HBC BRANDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203 54.1 Brand Valuations 2014. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203 54.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203 55 ONLINE RETAIL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55.2 Online Shopping Characteristics.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

204 204 205 205

PART IX: HOME FURNISHINGS & HOUSEWARES. . . . . . . . . . . . . . . . . . . . . . . . 206 56 MARKET ASSESSMENT: RETAIL STORES. . . . . . . . . . . . . . . . . . . . . . . . . . . 56.1 Spending At Furniture and Home Decor Stores. . . . . . . . . . . . . . . . . . . . . 56.2 Furniture Stores. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56.3 Home Decor And Furnishings Stores. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56.4 Floor Covering Stores. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

207 207 207 208 208

57 MARKET ASSESSMENT: RETAIL PRODUCTS. . . . . . . . . . . . . . . . . . . . . . . . 57.1 Total Product Spending. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57.2 Sales For Product Categories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57.3 Retail Channels.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57.4 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

209 209 209 210 210

58 TOP RETAILERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 211 58.1 Market Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 211 58.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 212 59 LARGEST HOME FURNISHINGS COMPANIES. . . . . . . . . . . . . . . . . . . . . . . . 213 59.1 Top Suppliers Of Home Furnishings Products. . . . . . . . . . . . . . . . . . . . . . 213 59.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 214 PART X: SPORTING GOODS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215 60 MARKET ASSESSMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60.1 Spending At Sporting Goods Stores. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60.2 Spending Distribution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60.3 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60.4 Trends.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60.5 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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216 216 217 218 218 218

61 SPORTS & RECREATION PARTICIPATION. . . . . . . . . . . . . . . . . . . . . . . . . . . 61.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61.2 Aerobics, Conditioning and Strength. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61.3 Individual Sports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61.4 Racquet Sports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61.5 Team Sports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61.6 Outdoor Sports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61.7 Water Sports.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61.8 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

220 220 220 221 221 222 222 223 223

62 SPORTING GOODS SHOPPING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 224 62.1 Shopping At Sporting Goods Stores. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 224 62.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 224 PART XI: SUPERMARKETS & GROCERIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225 63 MARKET ASSESSMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.1 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.2 Segment Profile. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

226 226 227 227

64 LARGEST SUPERMARKET CHAINS.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228 64.1 Marketshare Leaders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 228 64.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230 65 MARKETSHARE BY METROPOLITAN AREA. . . . . . . . . . . . . . . . . . . . . . . . . . 231 65.1 Retail Sales In The Largest MSAs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 231 65.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 238 66 CUSTOMER SPENDING.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 239 66.1 Spending At Supermarkets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 239 66.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 239 67 CPG SALES IN SUPERMARKETS.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 240 67.1 Sales at Mass Market Retail Stores. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 240 67.2 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 243 68 FOOD SALES IN NON-GROCERY FORMATS. . . . . . . . . . . . . . . . . . . . . . . . . 68.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68.2 Marketshare Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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244 244 244 245

69 GROCERY SHOPPING ONLINE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69.2 Market Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69.3 Case Studies.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

246 246 246 246

PART XII: SHOPPING CENTERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 248 70 MALLS & SHOPPING CENTERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70.2 Property Types, Configurations and Primary Trade Areas. . . . . . . . . . . . . 70.3 Largest Malls.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70.4 Market Trends.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70.5 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

249 249 249 253 253 253

71 SHOPPING CENTERS: STATE-BY-STATE. . . . . . . . . . . . . . . . . . . . . . . . . . . . 71.1 State Profiles. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71.2 Largest Malls.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

255 255 256 257

72 OWNERS.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72.2 Retail Property Owners. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

258 258 258 260

73 MANAGERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73.2 Retail Property Owners. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

261 261 261 263

74 BROKERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74.2 Retail Property Brokers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

264 264 264 265

75 REDEVELOPERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75.1 Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75.2 Shopping Center Redevelopers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75.3 Market Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

266 266 266 267

76 TRANSACTIONS.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 268 76.1 Shopping Center Acquisitions 2014. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 268

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APPENDIX A - ACADEMIC PROGRAMS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270 APPENDIX B - ANALYSTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 273 APPENDIX C - ASSOCIATIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 276 APPENDIX D - PERIODICALS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 278 REFERENCES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 280

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PART I: MARKET OVERVIEW

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1 RETAIL SALES: U.S.

1.1 The U.S. Retail Sector The U.S. retail industry encompasses more than 1.6 million retail establishments and employs more than 24 million people (about 1 in 5 American workers), according to the National Retail Federation (NRF, www.nrf.com).

1.2 Retail Sales According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total U.S. retail sales were $5.27 trillion in 2014, a 4.0% gain from 2013. Sales at GAFO (general merchandise, apparel, furnishings, and other) stores were $1.25 trillion in 2014, a 1.8% gain from 2013. Total retail and GAFO sales have been as follows: Total Retail

GAFO

$3.85 trillion $4.09 trillion $4.30 trillion $4.44 trillion $4.40 trillion $4.08 trillion $4.31 trillion $4.63 trillion $4.87 trillion $5.07 trillion $5.27 trillion

$1.00 trillion $1.06 trillion $1.11 trillion $1.15 trillion $1.14 trillion $1.10 trillion $1.13 trillion $1.17 trillion $1.21 trillion $1.23 trillion $1.25 trillion

• • • • • • • • • • •

2004: 2005: 2006: 2007: 2008: 2009: 2010: 2011: 2012: 2013: 2014:

• • • • • • • • •

GAFO sales were distributed by month in 2014 as follows: January: $ 87.0 billion February: $ 90.0 billion March: $100.3 billion April: $ 97.9 billion May: $104.5 billion June: $ 98.3 billion July: $100.2 billion August: $108.3 billion September: $ 96.6 billion Retail Business Market Research Handbook 2015-2016

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• • •

October: November: December:

$102.1 billion $116.6 billion $148.7 billion

Retail sales in 2014 for stores in the GAFO categories were as follows (change from previous year in parenthesis): • General merchandise stores, including leased departments (NAICS 452): $663.1 billion (1.7%) - Superstores and warehouse clubs (NAICS 45291): $443.3 billion (5.1%) - Discount department stores, including leased departments (NAICS 452112): $110.6 billion (-1.7%) - Conventional and national chain department stores, including leased departments (NAICS 452111): $ 58.2 billion (-1.0%) - Variety stores and miscellaneous (NAICS 45299): $ 62.0 billion (4.6%) •

Apparel and accessories stores (NAICS 448): - Family clothing (NAICS 44814): - Women’s ready-to-wear (NAICS 44812): - Jewelry stores (NAICS 44831): - Shoe stores (NAICS 4482): - Men’s and boy’s clothing (NAICS 44811):

$253.7 billion (2.0%) $ 99.4 billion (1.8%) $ 42.8 billion (5.3%) $ 33.6 billion (1.1%) $ 30.9 billion (3.2%) $ 9.0 billion (1.1%)

•

Sporting goods, hobby, book, and music stores (NAICS 451): - Sporting goods stores (NAICS 45111): - Book stores (NAICS 451211): - Hobby, toy, and game stores (NAICS 45112):

$ $ $ $

•

Furniture and home furnishings (NAICS 442):

$101.1 billion (3.0%)

•

Electronics and appliance stores (NAICS 443):

$107.3 billion (2.9%)

•

Office supplies and stationary stores (NAICS 45321):

$ 17.1 billion (-5.6%)

•

Gift, novelty, and souvenir stores (NAICS 45322):

$ 20.5 billion (6.7%)

•

Used merchandise stores (NAICS 4533):

$ 15.2 billion (4.2%)

•

Retail sales in non-GAFO retail categories in 2014 were as follows: Motor vehicles and parts stores (NAICS 441): $1.057 trillion (8.1%)

•

Food and beverage stores, not including restaurants (NAICS 445):

87.7 billion (-0.4%) 43.2 billion (-2.1%) 11.4 billion (-4.3%) 20.2 billion (5.4%)

$ 668.7 billion (3.0%)

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•

Restaurants and drinking places (NAICS 722):

$ 571.2 billion (5.8%)

•

Building materials, home improvement and gardening equipment, and supplies dealers (NAICS 444):

$ 328.5 billion (5.2%)

•

Gasoline stations (NAICS 447):

$ 533.4 billion (-2.8%)

•

Health and personal care stores, including pharmacies and drug stores (NAICS 446):

$ 298.5 billion (6.0%)

Non-store retailers (NAICS 454):

$ 480.7 billion (7.0%)

•

1.3 Market Resources Estimates Of Monthly Retail and Food Services Sales By Kind Of Business , U.S. Department of Commerce. (www.census.gov/retail/marts/www/marts_current.pdf) Monthly and Annual Retail Trade, U.S. Department of Commerce. (www.census.gov/retail) National Retail Federation, 325 7 th Street NW, Suite 110, Washington, DC 20004. (202) 783-7971. (www.nrf.com)

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2 RETAIL SALES: STATE-BY-STATE

2.1 Retail Sales By State According to the National Retail Federation (NRF, www.nrf.com), retail sales were distributed by state as follows (2013 sales, most recent data available): • Alabama: $ 46.61 billion • Alaska: $ 8.08 billion • Arizona: $ 69.61 billion • Arkansas: $ 28.28 billion • California: $369.84 billion • Colorado: $ 52.83 billion • Connecticut: $ 38.84 billion • District Of Columbia: $ 4.66 billion • Delaware: $ 11.49 billion • Florida: $226.88 billion • Georgia: $ 93.55 billion • Hawaii: $ 15.53 billion • Idaho: $ 15.85 billion • Illinois: $125.87 billion • Indiana: $ 61.84 billion • Iowa: $ 28.59 billion • Kansas: $ 24.55 billion • Kentucky: $ 39.16 billion • Louisiana: $ 41.33 billion • Maine: $ 15.85 billion • Maryland: $ 61.84 billion • Massachusetts: $ 72.72 billion • Michigan: $ 96.34 billion • Minnesota: $ 55.94 billion • Mississippi: $ 27.66 billion • Missouri: $ 61.22 billion • Montana: $ 11.18 billion • Nebraska: $ 19.26 billion • Nevada: $ 35.43 billion • New Hampshire: $ 20.82 billion • New Jersey: $ 96.96 billion • New Mexico: $ 19.26 billion

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• • • • • • • • • • • • • • • • • • •

New York: North Carolina: North Dakota: Ohio: Oklahoma: Oregon: Pennsylvania: Rhode Island: South Carolina: South Dakota: Tennessee: Texas: Utah: Vermont: Virginia: Washington: West Virginia: Wisconsin: Wyoming:

$184.30 billion $ 89.82 billion $ 7.76 billion $105.36 billion $ 31.07 billion $ 39.47 billion $126.49 billion $ 10.56 billion $ 42.26 billion $ 9.94 billion $ 65.26 billion $232.78 billion $ 26.10 billion $ 7.76 billion $ 81.73 billion $ 70.24 billion $ 16.78 billion $ 55.94 billion $ 6.52 billion

2.2 Market Resources National Retail Federation, 325 7 th Street NW, Suite 110, Washington, DC 20004. (202) 783-7971. (www.nrf.com)

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3 RETAIL CENSUS

3.1 Overview The North American Industry Classification System (NAICS) is the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy. The NAICS codes for retail establishments are as follows: • 441 Motor Vehicle and Parts Dealers • 442 Furniture and Home Furnishings Stores • 443 Electronics and Appliance Stores • 444 Building Material and Garden Equipment and Supplies Dealers • 445 Food and Beverage Stores • 446 Health and Personal Care Stores • 447 Gasoline Stations • 448 Clothing and Clothing Accessories Stores • 451 Sporting Goods, Hobby, Musical Instrument, and Book Stores • 452 General Merchandise Stores • 453 Miscellaneous Store Retailers • 454 Nonstore Retailers

3.2 Employment And Establishment Counts By NAICS code, the numbers of employees and establishments in the retail sector are as follows: NAICS

441 4411 44111 44112 4412 44121 44122 441222 441228 4413 44131 44132

Motor Vehicle and Parts Dealers: Automobile Dealers: New Car Dealers: Used Car Dealers: Other Motor Vehicle Dealers: Recreational Vehicle Dealers: Motorcycle, Boat, and Other Motor Vehicle Dealers: Boat Dealers: Motorcycle, ATV, and All Other Motor Vehicle Dealers: Automotive Parts, Accessories, and Tire Stores: Automotive Parts and Accessories Stores: Tire Dealers:

Employees

Establishments

1,718,800 1,099,236 975,429 123,807 125,415 33,029 92,386 30,758 61,628 494,149 322,375 171,774

116,409 45,011 21,277 23,734 14,205 2,625 11,580 4,697 6,883 57,193 37,031 20,162

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442 4421 4422 44221 44229 442291 442299

Furniture and Home Furnishings Stores: Furniture Stores: Home Furnishings Stores: Floor Covering Stores: Other Home Furnishings Stores: Window Treatment Stores: All Other Home Furnishings Stores:

422,595 194,500 228,095 61,250 166,845 6,240 160,605

51,645 23,724 27,921 11,418 16,503 1,772 14,731

443 443141 443142

Electronics and Appliance Stores: Household Appliance Stores: Electronics Stores:

428,298 60,025 368,273

49,684 8,358 41,326

444

Building Material and Garden Equipment and Supplies Dealers: Building Material and Supplies Dealers: Home Centers: Paint and Wallpaper Stores: Hardware Stores: Other Building Material Dealers: Lawn and Garden Equipment and Supplies Stores: Outdoor Power Equipment Stores: Nursery, Garden Center, and Farm Supply Stores:

1,170,402 1,026,970 605,348 30,696 137,541 253,385 143,432 23,972 119,460

78,314 60,426 6,569 7,019 15,450 31,388 17,888 3,991 13,897

4441 44411 44412 44413 44419 4442 44421 44422 445 4451 44511

2,872,426 2,582,042

145,624 91,530

44512 4452 44521 44522 44523 44529 445291 445292 445299 4453

Food and Beverage Stores: Grocery Stores: Supermarkets and Other Grocery (except Convenience) Stores: Convenience Stores: Specialty Food Stores: Meat Markets: Fish and Seafood Markets: Fruit and Vegetable Markets: Other Specialty Food Stores: Baked Goods Stores: Confectionery and Nut Stores: All Other Specialty Food Stores: Beer, Wine, and Liquor Stores:

2,471,155 110,887 139,449 33,782 10,293 20,332 75,042 19,560 19,520 35,962 150,935

66,047 25,483 21,767 5,228 1,957 2,788 11,794 3,240 3,171 5,383 32,327

446 44611 44612 44613 44619 446191

Health and Personal Care Stores: Pharmacies and Drug Stores: Cosmetics, Beauty Supplies, and Perfume Stores: Optical Goods Stores: Other Health and Personal Care Stores: Food (Health) Supplement Stores:

1,010,173 717,170 107,531 77,669 107,803 38,445

92,423 43,343 15,320 12,908 20,852 9,171

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446199

All Other Health and Personal Care Stores:

69,358

11,681

447 44711 44719

Gasoline Stations: Gasoline Stations with Convenience Stores: Other Gasoline Stations:

862,630 721,088 141,542

114,033 97,939 16,094

448 4481 44811 44812 44813 44814 44815 44819 4482 4483 44831 44832

Clothing and Clothing Accessories Stores: Clothing Stores: Men’s Clothing Stores: Women’s Clothing Stores: Children’s and Infants’ Clothing Stores: Family Clothing Stores: Clothing Accessories Stores: Other Clothing Stores: Shoe Stores: Jewelry, Luggage, and Leather Goods Stores: Jewelry Stores: Luggage and Leather Goods Stores:

1,630,575 1,299,149 59,229 398,737 82,175 606,308 62,270 90,430 201,974 129,452 123,520 5,932

147,436 97,566 7,903 38,686 6,945 25,421 8,564 10,047 25,455 24,415 23,413 1,002

451 4511 45111 45112 45113 45114 4512 451211 451212

Sporting Goods, Hobby, Musical Instrument, and Book Stores: Sporting Goods, Hobby, and Musical Instrument Stores: Sporting Goods Stores: Hobby, Toy, and Game Stores: Sewing, Needlework, and Piece Goods Stores: Musical Instrument and Supplies Stores: Book Stores and News Dealers: Book Stores: News Dealers and Newsstands:

511,983 418,264 225,345 122,761 41,776 28,382 93,719 85,495 8,224

46,321 37,894 20,893 8,297 4,854 3,850 8,427 7,244 1,183

452 4521 452111 452112 4529 45291 45299

General Merchandise Stores: Department Stores: Department Stores (except Discount Dept. Stores): Discount Department Stores: Other General Merchandise Stores: Warehouse Clubs and Supercenters All Other General Merchandise Stores:

2,871,931 1,085,098 466,383 618,715 1,786,833 1,465,280 321,553

48,872 8,196 3,507 4,689 40,676 5,164 35,512

453 4531 4532 45321 45322 4533

Miscellaneous Store Retailers: Florists: Office Supplies, Stationery, and Gift Stores: Office Supplies and Stationery Stores: Gift, Novelty, and Souvenir Stores: Used Merchandise Stores:

712,624 62,397 245,958 93,535 152,423 170,824

107,000 14,344 32,580 7,443 25,137 19,793

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4539 45391 45392 45393 453991 453998

454 4541 454111 454113 4542 4543 45431 45439

Other Miscellaneous Store Retailers: Pet and Pet Supplies Stores: Art Dealers: Manufactured (Mobile) Home Dealers: Tobacco Stores: All Other Miscellaneous Store Retailers (except Tobacco Stores):

233,445 101,481 16,565 11,358 34,514

40,283 8,813 4,937 24,240 9,013

69,527

15,227

Nonstore Retailers: Electronic Shopping and Mail-Order Houses: Electronic Shopping: Mail-Order Houses: Vending Machine Operators: Direct Selling Establishments: Fuel Dealers: Other Direct Selling Establishments:

595,521 365,508 204,352 155,814 42,344 187,669 77,031 110,638

66,081 30,185 23,955 5,789 4,205 31,691 9,175 22,516

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4 E-COMMERCE

4.1 Consumer Shopping Online According to eMarketer (www.emarketer.com), 162.6 million U.S. consumers shopped online in 2014, spending an average of $2,626. E-commerce buyer penetration in 2014 and projections for 2018 are as follows (source: eMarketer): • • • • • • • •

14-to-17: 18-to-24: 25-to-34: 35-to-44: 45-to-54: 55-to-64: 65 and older: Total:

2014

2018

55.8% 71.0% 69.8% 71.6% 68.6% 64.4% 36.7% 62.5%

60.8% 77.3% 76.6% 77.5% 77.6% 72.6% 42.3% 68.7%

In a survey by the IBM Institute For Business Value (www.ibm.com), one-half of shoppers said they preferred shopping online. _________________________________________________________________

“Shoppers are getting used to – and growing fond of – the online shopping experience. They enjoy the feeling of going to a favorite retailer’s webpage and opening tabs of different items to compare as they scroll down the page. They like the 1-2-3 browse, click and purchase experience.” eMarketer, 2/5/15 _________________________________________________________________

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4.2 E-Commerce Spending According to the U.S. Department of Commerce (www.doc.gov), e-commerce sales in the U.S. have been as follows: E-commerce Sales

• • • • • • • • • •

2005: 2006: 2007: 2008: 2009: 2010: 2011: 2012: 2013: 2014:

$ 86.3 billion $114.6 billion $132.8 billion $132.3 billion $134.9 billion $167.7 billion $194.7 billion $225.5 billion $264.3 billion $304.9 billion

Percent of Total Retail Sales Growth

2.3% 2.8% 3.2% 3.3% 3.7% 4.3% 4.7% 5.0% 5.7% 6.5%

25% 33% 16% no change 2% 24% 16% 16% 17% 15%

_________________________________________________________________

“Despite all this growth, online purchases remain a very small portion of retail sales. Over 90% of all United States retail commerce still takes place in physical stores.” The New York Times _________________________________________________________________

E-commerce sales by quarter in 2014 were as follows (change from same quarter in previous year in parenthesis): • First quarter: $71.5 billion (15.5%) • Second quarter: $75.1 billion (15.8%) • Third quarter: $77.8 billion (15.8%) • Fourth quarter: $79.6 billion (14.6%) According to eMarketer, online retail spending in 2014 was distributed by product category as follows (change from previous year in parenthesis): • Computer and consumer electronics: $66.4 billion (15.8%) • Apparel and accessories: $52.0 billion (16.2%) • Automotive and parts: $31.6 billion (15.9%) • Books, music, and video: $27.2 billion (17.0%) • Furniture and home furnishings: $20.3 billion (15.0%) • Health and personal care: $17.3 billion (14.9%) • Toys and hobby: $12.1 billion (15.5%)

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Office equipment and supplies: Food and beverage: Other:

$ 8.3 billion (13.8%) $ 6.0 billion (13.9%) $62.0 billion (14.5%)

4.3 Top Online Shopping Categories According to a July 2014 survey by Harris Interactive (www.harrisinteractive.com), the following percentages of adults have made select purchases online: • • • • • • • • • •

Clothing: Digital content (movies, music, e-books): Shoes and accessories: Personal electronics: Household electronics: Cosmetics and personal grooming: Prescription medications: Specialty food and beverages: O-T-C medications: Groceries:

Female

Male

Total

75% 56% 60% 43% 37% 41% 24% 24% 19% 15%

63% 62% 47% 55% 49% 28% 27% 27% 18% 16%

69% 59% 54% 49% 43% 35% 26% 25% 18% 15%

By age, consumers have made purchases online as follows: • • • • • • • • • •

18-36

37-48

49-67

68+

68% 65% 58% 57% 44% 39% 18% 25% 18% 18%

77% 72% 60% 57% 49% 41% 26% 32% 19% 23%

70% 53% 52% 44% 43% 32% 27% 21% 17% 11%

61% 38% 38% 26% 27% 20% 40% 27% 18% 16%

Clothing: Digital content (movies, music, e-books): Shoes and accessories: Personal electronics: Household electronics: Cosmetics and personal grooming: Prescription medications: Specialty food and beverages: O-T-C medications: Groceries:

4.4 Characteristics Of Online Shopping A poll of Internet users by The Nielsen Company (www.nielsen.com) asking primary reasons for shopping online found the following: • Able to shop 24 hours a day: 81% • Saves time: 76% • Able to comparison shop: 61% • Easy to find what I am looking for: 56% • Selection of items: 49% • Can search by brands I like: 46% • Available product information: 46% Retail Business Market Research Handbook 2015-2016

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• • • • • • •

Low prices: Items are in stock: Low shipping costs: Recommendations for items: Customer service and communication: Easy to return purchases: Gift services such as cards, wrapping, or birthday/holiday reminders:

45% 35% 24% 15% 12% 11% 10%

According to a survey by OneUpWeb (www.oneupweb.com), Internet users expect the following from e-commerce sites (percentage of respondents): • Pricing/shipping information clearly stated: 96% • Site looks credible and trustworthy: 76% • Product displayed on homepage: 71% • Visually appealing: 67% • Total cost calculator: 59% • Search function: 48% • Privacy statement: 46% • Onsite customer reviews: 41% • Online customer service (live chat): 32% • Links to social networks (Facebook, Twitter): 23% According to a survey by A.T. Kearney (www.atkearney.com), the following attributes are important to consumers when shopping online (percentage of respondents): • Finding specific products: 96% • Free shipping: 93% • Finding favorite brands: 92% • Best price: 90% • Ease of navigation: 88% • Site security: 87% • Special promotions: 78% • Free samples: 67% • Peer reviews: 59% • New products: 55% Participants in the July 2014 Harris Poll were asked which incentives would increase the likelihood of making a purchase online instead of in-person. Responses were as follows: • Free shipping: 81% • Free postage for sending in returns/exchanges: 70% • Opportunity to make returns/exchanges at a bricks-and-mortar store: 55%

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A November 2014 survey by Forrester Research (www.forrester.com) found that 86% of online shoppers had used a digital coupon, offer, or online promotion code within the prior three months.

4.5 Top Online Shopping Sites A September 2014 assessment by Millward Brown (www.millwardbrown.com) found that five sites garner one-half of shopping visits. The share of e-commerce traffic among the top sites is as follows: • Amazon.com: 22% • eBay.com: 17% • Walmart.com: 6% • Target.com: 3% • Etsy.com: 2% • All others: 50%

4.6 Shopping On Social Sites E-commerce transactions through storefronts on social media sites, dubbed social commerce, held great promise a few years ago with the rise in popularity of social networking. Consumers, however, have shown they do not prefer to shop on social sites. An August 2014 Harris Poll found that just 5% of U.S. adult Internet users had made a purchase on a social network such as Facebook, Twitter, or Pinterest. _________________________________________________________________

“How many digital buyers in the U.S. actually take the final leap on a social platform? Not too many. Social media storefronts are now a relic.” eMarketer, 9/26/14 _________________________________________________________________

Most social network storefronts have closed. According to 8th Bridge (www.8thbridge.com), 62% of retailers with Facebook apps had product browsing in 2012. By early 2014, only 15% did so.

4.7 Market Resources eMarketer, 75 Broad Street, 31 st Floor, New York, NY 10004. (212) 763-6010. (www.emarketer.com) Retail Business Market Research Handbook 2015-2016

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Internet Retailer, 125 S. Wacker Drive, Suite 2900, Chicago, IL 60606. (312) 362-9527. (www.internetretailer.com) Quarterly Retail E-Commerce Sales, U.S. Census Bureau. (www.census.gov/retail/mrts/www/data/pdf/ec_current.pdf)

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5 MOBILE COMMERCE

5.1 Overview The use of a smartphone or tablet to assist in shopping, or even to make a purchase, continues to increase in popularity. Product research, price comparisons, and mobile coupon redemption are the most common uses of mobile devices by shoppers. Many smartphone users also have used their device to make a purchase, an activity typically referred to as ‘mobile commerce’ or ‘m-commerce.’ According to M/A/R/C Research (www.marcresearch.com), the share of all consumers using mobile devices to make purchases increased to 35% in 2014 from 10% in 2012. Among adults who engaged in mobile shopping activities in 2014, 69.7% used their device to make a purchase, according to eMarketer (www.emarketer.com). The other 20.3% used mobile only for product research. The percentage making mobile purchases is projected to increase to 76.2% of all mobile shoppers by 2019. The New Digital Divide, an April 2014 report by Deloitte (www.deloitte.com), found that the use of mobile devices before or during in-store shopping trips influenced approximately $593 billion in in-store retail sales in 2013 – or 19% of total bricks-andmortar sales – up from $159 billion in 2012.

5.2 Use Of Mobile Devices For Online Purchases According to a July 2014 survey by Harris Interactive (www.harrisinteractive.com), the following percentages of adults have made select online purchases via cellphone or tablet (for comparison, using a laptop or desktop): Laptop/Desktop Smartphone

• • • • • • • • • •

Clothing: Digital content (movies, music, e-books): Shoes and accessories: Personal electronics: Household electronics: Cosmetics and personal grooming: Prescription medications: Specialty food and beverages: O-T-C medications: Groceries:

65% 48% 49% 43% 38% 31% 21% 23% 15% 12%

6% 12% 5% 5% 4% 4% 3% 3% 2% 2%

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Tablet

10% 17% 9% 7% 5% 5% 4% 3% 2% 2%

5.3 Market Assessment According to eMarketer, spending via mobile devices has been, and is projected, as follows: Sales

• • • • • • •

2012: 2013: 2014: 2015: 2016: 2017: 2018:

$ 24.78 billion $ 42.13 billion $ 57.79 billion $ 76.41 billion $ 98.12 billion $114.50 billion $132.69 billion

Pct. of E-commerce Sales

11% 16% 19% 22% 25% 26% 27%

The bulk of m-commerce spending is via tablets, which consumers tend to use more like a desktop than a phone. eMarketer assesses that 68% of m-commerce sales in 2014 were by tablet; that figure is projected to increase to 74% by 2018.

5.4 Customer Service For Mobile Shoppers In an October 2014 survey by Contact Solutions (www.contactsolutions.com), 75% of mobile shoppers said access to customer care impacts their shopping experience. Fifty-five percent (55%) of survey respondents report that they struggle at least 20% of the time when using a mobile app to shop. Forty-three percent (43%) say they have come to expect no customer service at all from mobile apps. Mobile shoppers respond to shopping difficulties via an app as follows (percentage of respondents): • Close app and abandon cart: 51.3% • Go to web using desktop or laptop: 36.9% • Go to store and shop: 11.5% • Call customer service: 8.2% Ninety-five percent (95%) say that a great customer experience will make them more likely to do business again with a retailer. Ninety-two percent (92%) of shoppers say it would be helpful to have customer care automatically provided within an app to help complete a task.

5.5 In-Store Mobile A 2014 study by the Consumer Electronics Association (CEA, www.ce.org) found that 58% of shoppers prefer to look up information on their mobile devices while shopping in stores, rather than talk to a salesperson. Shoppers ages 25-to-44 and men were most likely to prefer to access their device for product information. Nearly two-thirds fell that the information they gather on their mobile devices is more helpful than in-store

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information from product displays or sales literature. By product category, mobile shopper use of devices for assistance when shopping is as follows: • Electronics: 60% • Groceries: 55% • Apparel: 47% • Shoes: 45% • Health and beauty products: 39% _________________________________________________________________

“One thing is clear: Consumers still value customer service, but the way they want it delivered is changing with their consumption habits. As the retail path to purchase changes – mobile is now a significant part of the process, especially for researching on the go and even in-store – so do consumers’ preferences for how retailers connect with them.” eMarketer, 12/19/14 _________________________________________________________________

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6 OMNICHANNEL SHOPPING

6.1 Overview Omnichannel shopping allows consumers to shop across multiple channels – instore, online, and on a tablet or cellphone – potentially at the same time. Shopping by catalog and by TV are also part of the omnichannel retail mix. In a September 2014 survey by KPMG (www.kpmg.com), retail executives said omnichannel strategies were their #1 priority. _________________________________________________________________

“Seamless omnichannel selling is at the forefront of retailers’ minds. A majority of the U.S. retail executives who responded to the KPMG survey said their companies have adopted an omni-channel strategy to link shoppers’ in-store experience with the company’s website, mobile-device applications, and social-media platforms.” Shopping Centers Today, 9/4/14 _________________________________________________________________

6.2 Customer Preference For Omnichannel Retail According to Omnichannel Preferences Study, an October 2014 report by A.T. Kearney (www.atkearney.com), 67% of consumers who purchase online use the physical store before or after the transaction. Forrester Research (www.forrester.com) found in its June 2014 survey that 71% of consumers expect to view in-store inventory online. In the Multichannel Consumer Survey, by PricewaterhouseCoopers (PwC, www.pwc.com), 56% of U.S. adults said they are likely to spend more with multichannel retailers than with either online-only retailers or stores with bricks-and-mortar-only locations.

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_________________________________________________________________

“Our research shows that when consumers use multiple channels, they spend more. That flies in the face of conventional wisdom that launching an online store steals sales from physical stores.” Lisa Feigen Dugel, Director PwC Retail and Consumer Advisory Practice _________________________________________________________________

In a survey of cardholders, VISA found that 83% of adults would choose a retailer based on how easy it is to transact across online, in-store, and mobile.

6.3 Cross-Channel Shopping “Showrooming” is the practice where customers go to a bricks-and-mortar retail location, make a decision on what item to buy and, instead of heading to the check-out aisle, use a mobile device to find a better price online where they ultimately make their purchase. “Webrooming” occurs when consumers buy in a store after researching a purchase online. 2014 FutureBuy, a study by GfK (www.gfk.com), reported that 28% of consumers engaged in showrooming in 2014, a drop from 37% that did so in 2013. Forty-one percent (41%) practiced webrooming in 2014. By age, those who showroomed or webroomed in 2014 were as follows: Showrooming

• • • •

18-to-24: 25-to-34: 35-to-49: 50-to-68:

39% 32% 29% 18%

Webrooming

34% 46% 43% 30%

Showrooming and webrooming are only two of the cross-channel shopping options used by today’s consumers. Among those who said they had searched using one channel and made a purchase through another channel, a survey by Cisco Internet Business Solutions Group (www.cisco.com/web/about/ac79) found these consumers had engaged in the following cross-channel shopping activities (percentage of respondents): • PC-to-store: 57% • Store-to-online: 38% • Mobile-to-PC: 26%

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• • •

Kiosk-to-store (immediate in-store sale): Mobile-to-store: Kiosk-to-store (delivery to location of choice):

24% 24% 15%

In a 2014 survey by comScore (www.comscore.com) conducted for UPS, consumers said their preferred method of access to multichannel retailers was as follows: Researching Products

• • • • •

Online via desktop or laptop: In physical store: Online via tablet: Online via smartphone: With catalog, by phone, or email:

61% 13% 11% 10% 4%

Purchasing Products

44% 41% 7% 4% 4%

A March 2014 Gallup Poll (www.gallup.com) found that use of a mobile device had increased retail store trips for 22% of consumers while decreasing store trips among 19%. An April 2014 study by Deloitte (www.deloitte.com) found that smartphone shoppers were 14% more likely than non-smartphone shoppers to convert in-store, even when those smartphone shoppers used a mobile app or site not belonging to the retailer. Seventy-two percent (72%) of shoppers who used their smartphone on their most recent in-store trip made a purchase while there, compared with 63% of shoppers who did not use a smartphone to assist in making a purchase during their last in-store trip.

6.4 Buy Online, Pick Up In-Store Minding The Omnichannel Commerce Gap, an April 2014 study by Accenture (www.accenture.com), found that 50% of online shoppers expect retailers to offer buyonline, pick up in-store service. Thirty-six percent (36%) of Internet users have used the option. In a January 2015 survey by LoyaltyOne (www.loyaltyone.com), 69% of online shoppers said that avoiding shipping fees was reason enough to get them to a retailer’s bricks-and-mortar store for pickup. Instead of free shipping, 68% said they would visit the store to pick up their online purchase for minor promotions, even those offering discounts between just 1% and 15% off.

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_________________________________________________________________

“Buy online, pick up in-store models took center stage in 2014, providing a viable option for retailers struggling to figure out how to keep fulfillment on pace with ordering and how best to cater to consumer demands for speed, convenience and low costs. The practice provides hope for retailers seeking to lure consumers into bricks-and-mortar stores and increase shoppers’ ticket value at the cash register.” eMarketer, 1/15/15 _________________________________________________________________

6.5 Catalogs According to the Direct Marketing Association (www.thedma.org), catalogs peaked in 2007 with circulation of 19.6 billion. In 2013, 11.9 billion catalogs were mailed, the first uptick since circulation plummeted during the 2008 recession. The National Retail Federation (www.nrf.com) reported that 8% of consumers purchased back-to-school products from catalogs, 3.6% purchased Easter items from catalogs, and 2.6% purchased Valentine’s gifts from catalogs. Most retailers that publish catalogs do so now to enhance in-store and online sales rather than to garner direct sales. The Wall Street Journal reports that shoppers that browse items in a catalog are likely to spend more money with a retailer regardless of whether the purchase takes place online or offline. Some retailers spend up to half of their marketing budgets on catalogs, hoping that the content will prove compelling enough to drive purchases. _________________________________________________________________

“When the pendulum swings one way, it inevitably swings back. Just because shoppers don’t purchase directly from catalogs doesn’t mean that the catalogs don’t drive sales. The path to purchase, beginning with a catalog, just may be more indirect than in the past.” eMarketer, 10/10/14 _________________________________________________________________

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The nature of the catalog has changed. Instead of showing every item a retailer has to offer, catalogs now resemble glossy fashion magazines featuring models in lifestyle poses that inspire consumers to seek out more items online or in-store.

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7 CHRISTMAS SEASON SHOPPING

7.1 Market Assessment According to the National Retail Federation (NRF, www.nrf.com), more than 90% of Americans celebrate either Christmas, Kwanzaa or Hanukkah. _________________________________________________________________

“The holiday season generally accounts for 20% to 40% of a retailer’s annual sales, according to the National Retail Federation, and Thanksgiving weekend alone typically represents about 10% to 15% of those holiday sales.” The New York Times _________________________________________________________________

According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, year-over-year growth of December retail sales has been as follows: Total Retail* GAFO** • 2005: 6.2% 4.6% • 2006: 3.0% 3.7% • 2007: 3.1% -0.3% • 2008: -6.8% -6.0% • 2009: 5.6% 1.4% • 2010: 6.4% 3.2% • 2011: 5.6% 4.0% • 2012: 1.6% 0.6% * excluding motor vehicle and parts dealers ** GAFO: (general merchandise, apparel, furnishings, and other)

According to 2014 Holiday Shopping Behavior Survey, by Simon (www.simon.com), 83% of adults shopped at a mall during the 2014 holiday season; among those ages 18-to-33, 89% did so. Seventy-eight percent (87%) of shoppers said

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the wide variety they find at a mall proves helpful when searching for gifts. Eighty percent (80%) said that shopping bricks-and-mortar in the malls helps to provide inspiration for their purchases and that they can organically discover products in a way they may not be able to online. U.S. shopping center sales rose 4.3% in December 2014 over the prior year, according to the International Council of Shopping Centers (www.icsc.org). For November and December 2014 combined, sales increased to $487.1 billion, an increase of 3.6% and the best performance for a holiday season since 2011.

7.2 Holiday Sales and Traffic According to the National Retail Federation, total holiday retail sales increased 4.1% to $616.9 billion in 2014. This followed increases of 3.1% and 3.0%, respectively, in 2013 and 2012. NRF’s consumer spending survey found that the average shopper spent $804 in 2014, up nearly 5% from 2013. Gift spending by recipient in 2014 was as follows (change from 2013 in parenthesis): • Family: $459.87 (6%) • Friends: $ 80.00 (7%) • Co-workers: $ 26.23 (7%) • Other, including pets: $ 20.63 (14%) Self-gifting, one of the more popular trends in recent years, declined in 2014 as more shoppers opted to shift their budgets towards spending on others. On average, consumers spent $126.68 on themselves during the 2014 holiday season, a drop of 6% compared with 2013. Holiday shopping by retail venue in 2014 was as follows: • Discount stores: 61.9% • Department: 59.7% • grocery stores: 51.2% • Clothing or accessories stores: 36.7% • Electronics stores: 30.8% • Drug stores: 19.2% • Craft and fabric stores: 18.8% Total holiday gift card spending was $31.7 billion in 2014. According to NRF’s Gift Card Spending Survey, the average person buying gift cards spent $172.74, up 5.8% from 2013.

7.3 Early Holiday Shopping Early holiday shopping is on the rise. According to the NRF, 30% of adults say

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they shop for the holiday season year-round. In 2014, 40% of adults began their holiday shopping before Halloween, and 41% began in November. When asked why they begin shopping for the holiday season as early as September, 62% of shoppers said it helps them spread out their spending, and 52% said they do so to help avoid the stress of last-minute shopping. According to ShopperTrak (www.shoppertrak.com), holiday spending in November increased 5.4% in 2014 compared with 2013; spending in December 2014 increased 3.8%. _________________________________________________________________

“While the bulk of holiday sales still take place in December, ShopperTrak has seen a steady shift toward November over the past 10 years. This year, it is expected that approximately 45% of the season’s sales have already taken place [by the end of November].” ShopperTrak, 12/9/14 _________________________________________________________________

7.4 Holiday Online Shopping The Christmas/Hanukkah/Kwanzaa online shopping season is generally designated as the period from November 1 through December 31. According to the National Retail Federation, 56% of adults shopped online during the 2014 holiday season, an increase from 52% who did so in 2013. comScore (www.comscore.com) reported U.S. retail e-commerce spending from desktop computers for the 51 days of the November-December 2014 holiday season was $48.3 billion, a 15% increase compared with the corresponding days in 2013. Sales for the major online seasonal shopping days and segments in 2014 were as follows (change from previous year in parenthesis): • November 1-December 21 (vs. Nov. 2-Dec. 22, 2013): $48.27 billion (15%) • Pre-Thanksgiving (November 1-26 vs. November 2-27, 2013): $20.18 billion (13%) • Thanksgiving thru Final Week: $28.09 billion (16%) • Thanksgiving Day (November 27): $ 1.01 billion (32%) • Black Friday (November 28): $ 1.50 billion (26%) • Holiday Weekend (November 29-30): $ 2.01 billion (26%) • Cyber Monday (December 1): $ 2.04 billion (17%) • Thanksgiving thru Cyber Monday: $ 6.56 billion (24%) • Cyber Week (December 1-7): $ 9.13 billion (14%)

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• • • • • • •

Cyber Work Week, Monday-Friday (December 1-5): Cyber Weekend (December 6-7): Green Monday (December 8): Free Shipping Day (December 18): Final Week (December 15-21): Final Work Week, Monday-Friday (December 15-19): Final Weekend (December 20-21):

$ $ $ $ $ $ $

7.28 billion (15%) 1.84 billion (11%) 1.62 billion (15%) 926 million (7%) 5.82 billion (18%) 4.84 billion (15%) 972 million (36%)

7.5 Market Resources comScore, 11950 Democracy Drive, Suite 600, Reston, VA 20190. (703) 438-2000. (www.comscore.com) National Retail Federation, 325 7 th Street NW, Suite 1100, Washington, DC 20004. (202) 783-7971. (www.nrf.com) ShopperTrak, 233 South Wacker Drive, 41st Floor, Chicago, IL 60606. (312) 529-5300. (www.shoppertrak.com)

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8 BACK-TO-SCHOOL SHOPPING

8.1 Market Assessment The back-to-school season typically is the second-biggest consumer spending event for retailers – behind the winter holidays – and can account for up to 15% of retailers’ annual sales. It is sometimes used to gauge the health of the upcoming holiday shopping season. According to National Retail Federation, (NRF, www.nrf.com), total back-toschool (K-12) and back-to-college spending in 2014 was $74.9 billion, distributed as follows (change from previous year in parenthesis): • Back-to-school: $26.5 billion (-0.7%) • Back-to-college: $48.4 billion (5.7%)

8.2 Back-to-School Spending According to NRF’s 2014 Consumer Intentions and Actions Survey, conducted by Prosper Business Development (www.goprosper.com), students and parents reported average spending of $669 on back-to-school merchandise. Back-to-school spending was distributed by category as follows: • • • •

Apparel: Electronics/computers: Shoes: School supplies:

Avg. Per Student

Total Spending

$231 $212 $124 $101

$9.2 billion $8.4 billion $4.9 billion $4.0 billion

Students and parents reported purchases f or back-to-school items from the following retail channels (percentage of shoppers): • Discount store: 60% • Department store: 54% • Specialty apparel: 43% • Office supply store: 37% • Online: 27% • Electronics store: 14% • Drug store: 13% Students and their parents had planned their shopping for back-to-school merchandise as follows (percentage of shoppers): Retail Business Market Research Handbook 2015-2016

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• • • • •

At least two months before school started: Three-to-four weeks before school started: One-to-two weeks before school started: The week school started: After school started:

22% 48% 24% 3% 3%

8.3 Back-to-College Spending The National Retail Federation estimated 2014 back-to-college spending (excluding textbooks) at $48.4 billion, an increase from $45.8 billion the previous year. According to NRF’s 2014 Consumer Intentions and Actions Survey, students and parents reported average spending of $916 on back-to-college merchandise, an increase from $916 in 2013. Back-to-college spending was distributed by category as follows: • • • • • • • • •

Electronics/computers: Apparel: Food, snacks and beverages: Dorm/apartment furnishings: Personal care items: Shoes: School supplies: Gift cards/pre-paid cards: Collegiate branded gear:

Avg. Per Student

Total Spending

$244 $139 $104 $ 96 $ 78 $ 77 $ 74 $ 56 $ 47

$12.9 billion $ 7.3 billion $ 5.5 billion $ 5.1 billion $ 4.1 billion $ 4.1 billion $ 4.0 billion $ 2.9 billion $ 2.5 billion

College students and their parents reported purchases f or back-to-school items from the following retail channels (percentage of shoppers): • Discount store: 57% • Department store: 45% • Apparel store: 35% • Office supply store: 40% • Online: 37% • Electronics store: 21% • Drug store: 22% • Home furnishings store: 16% Students and their parents had planned their shopping for back-to-college merchandise as follows (percentage of shoppers): • At least two months before school started: 29% • Three-to-four weeks before school started: 32% • One-to-two weeks before school started: 23% • The week school started: 7% • After school started: 9%

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8.4 Market Resources Prosper Business Development, 400 West Wilson Bridge, Suite 200, Worthington, OH 43085. (614) 846-0146. (www.goprosper.com) National Retail Federation, 325 7 th Street NW, Washington, DC 20004. (202) 783-7971. (www.nrf.com)

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PART II: MARKET LEADERS

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9 RETAILERS: LARGEST COMPANIES

9.1 Rank By Revenue The National Retail Federation (www.retail.org) compiles an annual list of the Top 100 Retailers, based on the previous year’s sales volume. Published in the July 2014 issue of Stores, the top retail companies (excluding restaurant chains), ranked by sales and number of stores, are as follows: U.S. Sales

• • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Walmart: Kroger: Costco: Target: The Home Depot: Walgreen: CVS Caremark: Lowe’s: Amazon.com: Safeway: Best Buy: Publix: Macy’s: Apple Stores/iTunes: Sears Holdings: Ahold USA: Rite Aid: TJX: H-E-B: Albertsons: Kohl’s: Delhaize America: Dollar General: Meijer: True Value: Wakefern/Shoprite: BJ’s Wholesale Club: Gap: Whole Foods Market:

$334.30 billion (1.7%) $ 93.59 billion (1.6%) $ 74.74 billion (5.2%) $ 71.27 billion (-0.9%) $ 69.95 billion (6.6%) $ 68.06 billion (1.3%) $ 65.61 billion (3.1%) $ 52.21 billion (3.6%) $ 43.96 billion (27.2%) $ 37.53 billion (-3.7%) $ 35.76 billion (-1.2%) $ 28.91 billion (5.2%) $ 27.86 billion (0.9%) $ 26.64 billion (11.0%) $ 26.61 billion (-13.4%) $ 26.11 billion (1.1%) $ 25.52 billion (0.5%) $ 20.92 billion (7.7%) $ 19.68 billion (8.1%) $ 19.45 billion (n/a) $ 19.03 billion (-1.3%) $ 18.81 billion (0.1%) $ 17.50 billion (9.2%) $ 16.62 billion (5.3%) $ 16.33 billion (-1.6%) $ 14.10 billion (3.7%) $ 12.96 billion (4.9%) $ 12.87 billion (4.3%) $ 12.49 billion (10.3%)

Worldwide Sales

Stores

$473.97 billion $ 93.59 billion $105.10 billion $ 72.59 billion $ 78.81 billion $ 70.09 billion $ 66.68 billion $ 53.41 billion $ 77.55 billion $ 42.98 billion $ 42.15 billion $ 28.91 billion $ 27.93 billion $ 30.73 billion $ 31.28 billion $ 44.02 billion $ 25.52 billion $ 27.42 billion $ 21.00 billion $ 19.45 billion $ 19.03 billion $ 29.11 billion $ 17.50 billion $ 16.62 billion $ 16.33 billion $ 14.10 billion $ 12.96 billion $ 16.24 billion $ 12.91 billion

4,779 3,519 447 1,793 1,965 7,998 7,621 1,717 n/a 1,335 1,492 1,273 837 254 1,905 767 4,587 2,454 311 1,024 1,158 1,514 11,132 202 4,494 313 201 2,432 347

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Nordstrom: JCPenney: 7-Eleven: Bed Bath & Beyond: Supervalu: Aldi: Ace Hardware: Family Dollar Stores: Ross Stores: Limited Brands: Bi-Lo: Menard: Staples: Army Air Force Exchange: Trader Joe’s: AT&T Wireless: Verizon Wireless: Dollar Tree: Hy-Vee: AutoZone: Toys “R” Us: Health Mart Systems: Good Neighbor Pharmacy: Office Depot: Wegmans Food Markets: Giant Eagle: O’Reilly Automotive: Advance Auto Parts: Dillard’s: Sherwin Williams: Dick’s Sporting Goods: GameStop: Barnes & Noble: PetSmart: QVC: A&P: WinCo Foods: Tractor Supply Co.: Big Lots: Defense Comm. Agency: Save Mart: Foot Locker: Alimentation Couche-Tard: Harris Teeter Supermarkets.:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

12.36 billion (3.7%) 11.78 billion (-8.7%) 11.62 billion (8.7%) 11.31 billion (5.5%) 10.96 billion (-61.1%) 10.89 billion (8.5%) 10.60 billion (4.1%) 10.39 billion (11.4%) 10.22 billion (5.6%) 9.34 billion (1.8%) 9.08 billion (1.5%) 8.89 billion (5.3%) 8.88 billion (-6.1%) 8.64 billion (0.3%) 8.35 billion (6.4%) 8.34 billion (10.2%) 8.09 billion (1.1%) 7.67 billion (5.6%) 7.62 billion (3.6%) 7.58 billion (6.7%) 7.52 billion (-6.5%) 7.43 billion (2.9%) 7.27 billion (-13.0%) 7.02 billion (0.0%) 6.99 billion (6.1%) 6.94 billion (2.6%) 6.64 billion (7.6%) 6.44 billion (4.7%) 6.43 billion (-0.8%) 6.22 billion (18.1%) 6.21 billion (6.5%) 6.10 billion (-0.6%) 6.08 billion (-4.0%) 5.29 billion (2.2%) 5.84 billion (4.6%) 5.83 billion (-6.8%) 5.21 billion (5.7%) 5.16 billion (10.7%) 5.10 billion (-1.7%) 5.01 billion (-3.5%) 4.88 billion (0.7%) 4.76 billion (6.8%) 4.75 billion (4.5%) 4.71 billion (3.8%)

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

12.36 billion 11.85 billion 84.08 billion 11.50 billion 10.96 billion 50.08 billion 10.65 billion 10.39 billion 10.23 billion 9.97 billion 9.08 billion 8.89 billion 16.22 billion 8.64 billion 35.21 billion 8.34 billion 8.09 billion 7.84 billion 7.62 billion 8.85 billion 15.19 billion 13.30 billion 7.27 billion 10.48 billion 6.99 billion 6.94 billion 6.64 billion 6.48 billion 6.43 billion 6.51 billion 6.21 billion 9.04 billion 6.08 billion 6.11 billion 8.62 billion 5.83 billion 5.21 billion 5.16 billion 5.28 billion 5.01 billion 4.88 billion 6.50 billion 8.55 billion 4.71 billion

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260 1,087 7,974 1,453 1,544 1,328 4,171 7,916 1,276 2,648 684 284 1,515 530 410 2,179 1,920 4,812 235 4,802 868 3,199 3,155 1,070 83 420 4,166 4,023 296 3,685 644 4,272 1,366 1,247 n/a 277 91 1,276 1,493 179 226 2,360 3,826 216

• • • • • • • • • • • • • •

Ascena Retail Group: OfficeMax: Neiman Marcus: Burlington Coat Factory: IKEA North America: Williams-Sonoma: Michaels Stores: Dell: Belk: Roundy’s Supermarkets: Stater Bros. Holdings: Price Chopper Supermarkets: Signet Jewelers: Ingles Markets:

$ $ $ $ $ $ $ $ $ $ $ $ $ $

4.66 billion (49.1%) 4.65 billion (-3.7%) 4.64 billion (7.0%) 4.40 billion (7.3%) 4.37 billion (6.8%) 4.16 billion (6.2%) 4.13 billion (3.6%) 4.10 billion (-6.0%) 4.03 billion (2.1%) 3.94 billion (1.5%) 3.86 billion (-0.3%) 3.78 billion (2.5%) 3.64 billion (9.5%) 3.60 billion (0.6%)

$ 4.71 billion $ 6.07 billion $ 4.64 billion $ 4.42 billion $ 37.87 billion $ 4.38 billion $ 4.57 billion $ 4.10 billion $ 4.03 billion $ 3.94 billion $ 3.86 billion $ 3.78 billion $ 4.20 billion $ 3.60 billion

3,854 823 85 509 38 553 1,147 n/a 299 163 166 132 1,471 203

9.2 Market Resources Stores, published by the National Retail Federation, 325 7 th Street NW, Suite 1100, Washington, DC 20004. (202) 783-7971. (www.nrf.com)

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10 E-RETAILERS: LARGEST COMPANIES

10.1 Online Retailers The annual Top 500 Guide, published by Internet Retailer, ranks and profiles the 500 largest e-retailers in the United States. The top 500 companies account for over 60% of all online retail sales. The following are the Top 10 e-retailers from the 2014 Top 500: • Amazon.com: Mass merchant • Apple: Computers/electronics • Staples: Office supplies • Walmart.com: Mass merchant • Sears Holdings Corp.: Mass merchant • Liberty Interactive Corp.: Mass merchant • Netflix: Books/music/videos • Macy’s: Mass merchant • Office Depot: Office supplies • Dell: Computers/electronics

• • • • • • • • • • • • • • • • • •

Listed alphabetically, the Top 500 e-retailers are as follows: 1 Sale A Day: Specialty/non-apparel 1800Mattress.com: Housewares/home furnishings 1-800 Contacts: Health/beauty 1-800-Flowers.com: Flowers/gifts 3balls.com: Sporting goods 47St. Photo: Computers/electronics A/X Armani Exchange: Apparel/accessories Abercrombie & Fitch Co.: Apparel/accessories Abt Electronics: Computers/electronics AC Lens: Health/beauty Action Village: Sporting goods adidas America: Apparel/accessories Advance Auto Parts: Automotive parts/accessories AED Superstore: Health/beauty Aéropostale: Apparel/accessories Air & Water: Hardware/home improvement AirSplat.com: Toys/hobbies AJ Madison: Housewares/home furnishings

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ALDO Group: Alibris: Alice.com: Allied Electronics: Altrec.com: AMainHobbies.com: Amazon.com: American Apparel: American Eagle Outfitters: American Girl: American Greetings Corp.: American Musical Supply: AmeriMark Direct: AMI Clubwear: Amway: Ancestry.com: Ann Taylor: Apple: Appliance Zone: Army & Air Force Exchange: Art.com: Artbeads.com: Ascena Retail Group: Ashford.com: AutoAnything: AutoZone: Avon: AZ3 dba BCBG Max Azria: B&H Photo-Video-Pro Audio: BabyAge.com: BagBorroworSteal.com: Balsam Brands: Bare Escentuals: Bare Necessities: BarnesandNoble.com: Barneys New York: Bass Pro Outdoor Online: Batteries.com: Beachbody: Bealls: Beau-Coup Favors: Beauty Encounter: bebe Stores: Bed Bath & Beyond:

Apparel/accessories Books/music/videos Specialty/non-apparel Office supplies Sporting goods Toys/hobbies Mass merchant Apparel/accessories Apparel/accessories Toys/hobbies Flowers/gifts Specialty/non-apparel Apparel/accessories Apparel/accessories Health/beauty Specialty/non-apparel Apparel/accessories Computers/electronics Hardware/home improvement Mass merchant Housewares/home furnishings Specialty/non-apparel Apparel/accessories Jewelry Automotive parts/accessories Automotive parts/accessories Health/beauty Apparel/accessories Computers/electronics Specialty/non-apparel Apparel/accessories Specialty/non-apparel Health/beauty Apparel/accessories Books/music/videos Apparel/accessories Sporting goods Computers/electronics Health/beauty Mass merchant Flowers/gifts Health/beauty Apparel/accessories Housewares/home furnishings

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Belk Ecommerce: Bellacor: Benchmark Brands: Best Buy Co.: Better World Books: Beyond the Rack: Biblio: Bidz.com: Big Fish Games: BikeBandit.com: BJ’s Wholesale Club: Blinds.com: BlissWorld: Blockbuster: Blue Nile: Bluefly: Bluestem Brands: Boden USA: Body Central Corp.: Books-A-Million: Boot Barn: Boscov’s Department Store: Bose Corp.: Boston Green Goods: BrickHouseSecurity.com: Brooks Brothers: Brookstone: Build.com: BuildASign.com: Burberry Ltd.: Burton: Buy.com: BuyAutoParts.com: BuyOnlineNow: Cabela’s: CableOrganizer.com: CafePress.com: Calendars.com: Callaway Golf Interactive: Calumet Photographic: Camping World: Carter’s: Casual Male Retail Group: CD Listening Bar:

Mass merchant Housewares/home furnishings Apparel/accessories Computers/electronics Books/music/videos Apparel/accessories Books/music/videos Jewelry Toys/hobbies Sporting goods Mass merchant Housewares/home furnishings Health/beauty Books/music/videos Jewelry Apparel/accessories Apparel/accessories Apparel/accessories Apparel/accessories Books/music/videos Apparel/accessories Mass merchant Computers/electronics Health/beauty Computers/electronics Apparel/accessories Housewares/home furnishings Hardware/home improvement Specialty/non-apparel Apparel/accessories Sporting goods Mass merchant Automotive parts/accessories Office supplies Sporting goods Computers/electronics Mass merchant Specialty/non-apparel Sporting goods Specialty/non-apparel Sporting goods Apparel/accessories Apparel/accessories Books/music/videos

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CDW Corp.: CDWow.com Ltd.: Charlotte Russe Holding: Charming Shoppes: Chasing Fireflies: Cheaper Than Dirt: Chefs Catalog: Chegg: Chelsea & Scott Ltd.: Chico’s FAS: Christian Book Distributors: Christopher & Banks: Coach: Coastal Contacts: CoffeeForLess.com: Coldwater Creek: Colony Brands: Columbia Sportswear Co.: Comp-U-Plus: Cooking.com: Cost Plus: Costco Wholesale Corp.: Costume Craze: CPA2Biz: CPO Commerce: Crate and Barrel: Crocs: Crucial Technology: Crutchfield Corp.: CustomInk: CVS Caremark Corp.: Cymax Stores: Danskin.com: Databazaar.com: David’s Bridal: Deckers Outdoor Corp.: dELiA*s: Dell: Deluxe Corp.: Dermstore: Destination Maternity Corp.: Diamond Nexus Labs: Dick’s Sporting Goods: Dillard’s:

Computers/electronics Books/music/videos Apparel/accessories Apparel/accessories Apparel/accessories Sporting goods Housewares/home furnishings Books/music/videos Specialty/non-apparel Apparel/accessories Books/music/videos Apparel/accessories Apparel/accessories Health/beauty Food/drug Apparel/accessories Food/drug Apparel/accessories Computers/electronics Housewares/home furnishings Housewares/home furnishings Mass merchant Specialty/non-apparel Books/music/videos Hardware/home improvement Housewares/home furnishings Apparel/accessories Computers/electronics Computers/electronics Apparel/accessories Food/drug Housewares/home furnishings Apparel/accessories Office supplies Apparel/accessories Apparel/accessories Apparel/accessories Computers/electronics Office supplies Health/beauty Apparel/accessories Jewelry Sporting goods Mass merchant

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Directron.com: Discount Dance Supply: Discount Ramps.com: DiscountOfficeItems.com: Disney: Dover Saddlery: DrillSpot.com: DrJays.com: Drs. Foster and Smith: DSW: Eastern Mountain Sports: eBags: eCampus.com: Eddie Bauer: Edible Arrangements: eDiets.com: eForCity Corp.: eHobbies.com: Eileen Fisher: eMusic.com: Entertainment Earth: Envelopes.com: Everything Furniture: evo: Express: Fab.com: Fanatics: FansEdge: Fat Brain Toys: Fathead: Folica: Follett Higher Education Group: Foot Locker: Forever 21: Fossil: FragranceNet.com: Franklin Covey Products: Frederick’s of Hollywood: FreshDirect: Frys.com: FTD Group: Furniture.com: Gaiam: GameFly:

Computers/electronics Apparel/accessories Automotive parts/accessories Office supplies Specialty/non-apparel Specialty/non-apparel Hardware/home improvement Apparel/accessories Specialty/non-apparel Apparel/accessories Sporting goods Apparel/accessories Books/music/videos Apparel/accessories Food/drug Food/drug Computers/electronics Toys/hobbies Apparel/accessories Books/music/videos Toys/hobbies Office supplies Housewares/home furnishings Sporting goods Apparel/accessories Housewares/home furnishings Apparel/accessories Apparel/accessories Toys/hobbies Specialty/non-apparel Health/beauty Books/music/videos Apparel/accessories Apparel/accessories Apparel/accessories Health/beauty Office supplies Apparel/accessories Food/drug Computers/electronics Flowers/gifts Housewares/home furnishings Health/beauty Toys/hobbies

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GameStop Corp.: Gander Direct: Gap Direct: Garmin Ltd.: Geeks.com: General Nutrition Centers: GiftTree.com: Gilt Groupe: GlassesUSA.com: Godiva Chocolatier: Golden Eagle Coins: Golfsmith International Holdings: GourmetGiftBaskets.com: Green Mountain Coffee Roasters: Guess?: Hallmark Cards: HamGo Corp.: Hammacher Schlemmer & Co.: Hanna Andersson Corp.: Harry and David Holdings: Hat World: Hayneedle: hhgregg Appliances: Hickory Farms: Highland Products Group: Hot Topic: HP Home & Home Office: HRM USA: HSN: Hudson’s Bay: Hugo Boss: Ice.com: ID Wholesaler: ideeli: iHerb: IKEA.com: Indigo Books & Music: iNetVideo.com: Instawares: International Software Solutions Systems: InterWorld Highway: iRobot Corp.: iStores: ivgStores:

Toys/hobbies Sporting goods Apparel/accessories Computers/electronics Computers/electronics Health/beauty Flowers/gifts Apparel/accessories Apparel/accessories Food/drug Toys/hobbies Sporting goods Flowers/gifts Food/drug Apparel/accessories Flowers/gifts Computers/electronics Specialty/non-apparel Apparel/accessories Food/drug Apparel/accessories Mass merchant Computers/electronics Food/drug Specialty/non-apparel Apparel/accessories Computers/electronics Health/beauty Mass merchant Apparel/accessories Apparel/accessories Jewelry Specialty/non-apparel Apparel/accessories Health/beauty Housewares/home furnishings Books/music/videos Books/music/videos Specialty/non-apparel Computers/electronics Computers/electronics Hardware/home improvement Sporting goods Housewares/home furnishings

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J. Crew Group: J&P Cycles: J&R Electronics: Jackthreads.com: James Allen: JCPenney Co.: Jeffers: Jenson USA: Jewelry Television: JJBuckley.com: Joann.com: Jockey international: Jomashop.com: Jones Retail Corp.: Jos. A. Bank Clothiers: K&L Wine Merchants: Karmaloop.com: Kenneth Cole Productions: King Arthur Flour Co.: Kohl’s Corp.: L.L. Bean: Lafayette 148 New York: Lakeshore Learning Materials: Lakeside Collection: Lamps Plus: Lancome-USA.com: LD Products: LeapFrog Enterprises: LeatherUp.com: LEGO: Levenger Co.: Levi Strauss & Co.: Liberty Interactive Corp.: Lifetime Brands: LifeWay Christian Resources: Limoges Jewelry: Living Direct: Lowe’s Cos.: Luggage Online: LuLuLemon Athletica: LumberLiquidators.com: Luxottica Group s.p.A.: Macy’s: Marc Ecko Enterprises:

Apparel/accessories Automotive parts/accessories Computers/electronics Apparel/accessories Jewelry Mass merchant Specialty/non-apparel Sporting goods Jewelry Food/drug Toys/hobbies Apparel/accessories Jewelry Apparel/accessories Apparel/accessories Food/drug Apparel/accessories Apparel/accessories Food/drug Mass merchant Apparel/accessories Apparel/accessories Specialty/non-apparel Housewares/home furnishings Housewares/home furnishings Health/beauty Office supplies Toys/hobbies Apparel/accessories Toys/hobbies Specialty/non-apparel Apparel/accessories Mass merchant Housewares/home furnishings Books/music/videos Jewelry Housewares/home furnishings Hardware/home improvement Specialty/non-apparel Apparel/accessories Hardware/home improvement Apparel/accessories Mass merchant Apparel/accessories

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Market America: Mattress USA: Meijer: Microsoft Corp.: Miles Kimball Co.: MLB Advanced Media: ModCloth: Monkey Sports: Moosejaw Mountaineering: Motorcycle Superstore: Mountain Equipment Co-op: MovieMars.com: Musician’s Friend: Musicnotes: MyJewelryBox.com: Myotcstore.com: NASCAR.com Superstore: Nasty Gal: National Builder Supply: National Business Furniture: National Football League: National Geographic Society: National Hockey League: National Trade Supply: NB Web Express: NBA Media Ventures: NBTY: Nebraska Furniture Mart: Net-a-Porter: Net Direct Merchants: Netflix: New York & Co.: Newegg: Nike: Nordstrom: Northern Tool + Equipment Co.: Nutrisystem: Office Depot: OfficeMax: OmahaSteaks.com: One Kings Lane: OneCall.com: Online Stores: Onlineshoes.com:

Mass merchant Housewares/home furnishings Mass merchant Computers/electronics Housewares/home furnishings Apparel/accessories Apparel/accessories Sporting goods Sporting goods Sporting goods Sporting goods Books/music/videos Specialty/non-apparel Specialty/non-apparel Jewelry Health/beauty Apparel/accessories Apparel/accessories Hardware/home improvement Office supplies Apparel/accessories Specialty/non-apparel Apparel/accessories Hardware/home improvement Apparel/accessories Apparel/accessories Food/drug Housewares/home furnishings Apparel/accessories Hardware/home improvement Books/music/videos Apparel/accessories Computers/electronics Apparel/accessories Apparel/accessories Hardware/home improvement Food/drug Office supplies Office supplies Food/drug Housewares/home furnishings Computers/electronics Mass merchant Apparel/accessories

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OpticsPlanet: Orchard Brands Corp.: Oriental Trading Co.: OvernightPrints.com: Overstock.com: Ozbo.com: Pacific Sunwear of California: Panasonic Corp. of North America: Parts Express: Party City Corp.: Paul Fredrick: Payless ShoeSource: PC Connection: PC Mall: pcRUSH.com: Peapod: Performance: PersonalizationMall.com: Peruvian Connection Ltd.: PETCO Animal Supplies: PetMed Express: PetSmart: Phat Fashions: Philips Electronics N.V.: Potpourri Group: Powell’s Books: Power Equipment Direct: PrintingForLess.com: PropertyRoom.com: PureFormulas.com: RadioShack Corp.: Ralph Lauren: Recreational Equipment Inc.: Redcats USA: Reitmans: Replacements Ltd.: ReStockIt.com: Restoration Hardware: Road Runner Sports: Rock Bottom Golf: Rockler Woodworking and Hardware: Rooms To Go: Roots Canada Ltd.: Ross-Simons:

Sporting goods Apparel/accessories Specialty/non-apparel Office supplies Mass merchant Mass merchant Apparel/accessories Computers/electronics Computers/electronics Specialty/non-apparel Apparel/accessories Apparel/accessories Computers/electronics Computers/electronics Computers/electronics Food/drug Sporting goods Mass merchant Apparel/accessories Specialty/non-apparel Specialty/non-apparel Specialty/non-apparel Apparel/accessories Computers/electronics Flowers/gifts Books/music/videos Hardware/home improvement Office supplies Specialty/non-apparel Health/beauty Computers/electronics Apparel/accessories Sporting goods Apparel/accessories Apparel/accessories Housewares/home furnishings Office supplies Housewares/home furnishings Apparel/accessories Sporting goods Hardware/home improvement Housewares/home furnishings Apparel/accessories Jewelry

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RoyalDiscount.com: RueLaLa.com: Rugs Direct: Rugs USA: Safeway: Saks Direct: Sally Beauty: Sam Ash Music Corp.: Scentiments.com: Scholastic: School Specialty Online: Sears Holdings Corp.: Select Comfort Corp.: Sephora USA: Sheet Music Plus: Sheplers: Shoebuy.com: ShoeDazzle.com: ShoeMall.com: Shoes.com, a subsidiary of Brown Shoe Co.: Shop PBS: Shoplet: ShopNBC.com: ShoppersChoice.com: Shutterfly: Sierra Trading Post: Signet Jewelers Ltd.: Skechers USA: SkinCareRX: SkyMall: SmartPak Equine: SmartSign.com: SmoothFitness.com: Softchoice Corp.: Softmart: SolidSignal.com: Sonic Electronix: Sony Electronics: Spanx: Spreadshirt: Stacks and Stacks: Staples: Starbucks Corp.: Stroll:

Computers/electronics Mass merchant Housewares/home furnishings Housewares/home furnishings Food/drug Apparel/accessories Health/beauty Specialty/non-apparel Health/beauty Books/music/videos Books/music/videos Mass merchant Housewares/home furnishings Health/beauty Specialty/non-apparel Apparel/accessories Apparel/accessories Apparel/accessories Apparel/accessories Apparel/accessories Books/music/videos Office supplies Mass merchant Mass merchant Specialty/non-apparel Apparel/accessories Jewelry Apparel/accessories Health/beauty Mass merchant Specialty/non-apparel Specialty/non-apparel Sporting goods Computers/electronics Computers/electronics Computers/electronics Computers/electronics Computers/electronics Apparel/accessories Apparel/accessories Housewares/home furnishings Office supplies Food/drug Specialty/non-apparel

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Summit Sports: Sundance Catalog Co.: Super Warehouse Business Products: SuperBiiz.com: Sur La Table: Sweetwater.com: Symantec Corp.: Systemax: TABcom: Target Corp.: Team Express: Tech for Less: Tempur-Pedic International: Textbooks.com: The Buckle: The Bon-Ton Stores: The Children’s Place: The Container Store: The Discovery Channel Store: The Estée Lauder Cos.: The Finish Line: The Gymboree Corp.: The Home Depot: The Limited: The Men’s Wearhouse: The Neiman Marcus Group: The Original Honey Baked Ham Co.: The Orvis Co.: The Shopping Channel: The Sports Authority: The Talbots: The Vermont Teddy Bear Co.: The Wet Seal: The Yankee Candle Co.: Things Remembered: ThinkGeek: Thompson and Co. of Tampa: Threadless.com: Tiffany & Co.: Tilly’s: Timberland: TimeLife.com: Title 9 Sports: Tool King:

Sporting goods Apparel/accessories Computers/electronics Computers/electronics Housewares/home furnishings Specialty/non-apparel Computers/electronics Computers/electronics Specialty/non-apparel Mass merchant Sporting goods Computers/electronics Housewares/home furnishings Books/music/videos Apparel/accessories Apparel/accessories Apparel/accessories Housewares/home furnishings Specialty/non-apparel Health/beauty Apparel/accessories Apparel/accessories Hardware/home improvement Apparel/accessories Apparel/accessories Apparel/accessories Food/drug Apparel/accessories Mass merchant Sporting goods Apparel/accessories Flowers/gifts Apparel/accessories Flowers/gifts Flowers/gifts Mass merchant Housewares/home furnishings Apparel/accessories Jewelry Apparel/accessories Apparel/accessories Books/music/videos Apparel/accessories Hardware/home improvement

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Toolfetch.com: Toolup.com: Tory Burch: Touch of Class: Toys “R” Us: Tractor Supply Co.: TrollandToad.com: Tumi: Turn5: U.S. Auto Parts Network: U.S. Toy Co.: ULTA Salon, Cosmetics & Fragrance: UnbeatableSale.com: Under Armour: UniqueSquared.com: Urban Outfitters: Vann’s: Vera Bradley: VF Corp.: Victoria’s Secret Direct/Bath and Body Works: Vintage Tub and Bath: Vistaprint NV: Vitacost.com: VitaminShoppe.com: W.W. Grainger: Walgreen Co.: Walmart.com: Wayfair: Weight Watchers: West Marine Products: Williams-Sonoma: Wine.com: Wolverine World Wide: World Wrestling Entertainment: XO Group: YesAsia Holdings Ltd.: YOOX Group: Zale Corp.: Zazzle: Zones: ZooStores.com: Zumiez:

Hardware/home improvement Hardware/home improvement Apparel/accessories Housewares/home furnishings Toys/hobbies Hardware/home improvement Toys/hobbies Specialty/non-apparel Automotive parts/accessories Automotive parts/accessories Toys/hobbies Health/beauty Mass merchant Apparel/accessories Computers/electronics Apparel/accessories Computers/electronics Apparel/accessories Apparel/accessories Apparel/accessories Hardware/home improvement Office supplies Health/beauty Health/beauty Hardware/home improvement Food/drug Mass merchant Housewares/home furnishings Food/drug Specialty/non-apparel Housewares/home furnishings Food/drug Apparel/accessories Apparel/accessories Specialty/non-apparel Books/music/videos Apparel/accessories Jewelry Specialty/non-apparel Office supplies Housewares/home furnishings Apparel/accessories

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10.2 Market Resources Internet Retailer, 125 S. Wacker Drive, Suite 2900, Chicago, IL 60606. (312) 362-9527. (www.internetretailer.com) Top 500 Guide, Internet Retailer, 2014. (www.internetretailer.com/top500/list)

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11 E-RETAILERS: CONSUMER FAVORITES

11.1 Favorite 50 The National Retail Federation (www.retail.org) compiles an annual ranking of consumers’ preferred e-commerce sites derived from a survey of consumers’ online apparel and non-apparel shopping habits. The ranking is based on surveys by Prosper Insights and Analytics (www.goprosper.com). The most recent list, published in the June 2014 issue of Stores, is as follows: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28.

Company

Product Line

Amazon.com: Walmart.com: eBay.com: Kohls.com: BestBuy.com: Target.com: JCPenney.com: Macys.com: Sears.com: OldNavy.com: Google.com: LandsEnd.com: Kmart.com: LLBean.com: Overstock.com: WomanWithin.com: Forever21.com: HomeDepot.com: Gap.com: Zappos.com: QVC.com: Haband.com: Blair.com: Nordstrom.com: Yahoo.com: VictoriasSecret.com: BedBathandBeyond.com: AE.com:

general merchandise general merchandise online marketplace apparel electronics general merchandise apparel apparel general merchandise apparel information apparel general merchandise apparel general merchandise apparel apparel hardware apparel footwear general merchandise apparel apparel apparel information apparel home goods apparel

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29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.

Newegg.com: Aeropostale.com: Lowes.com: KingSizeDirect.com: Hollisterco.com: Nike.com: ColdwaterCreek.com: Express.com: TigerDirect.com: Roamans.com: Belk.com: Costco.com: LaneBryant.com: Meijer.com: HotTopic.com: RossStores.com: OneStopPlus.com: TJMaxx.com: SamsClub.com: Dillards.com: BananaRepublic.com: ChildrensPlace.com:

electronics apparel hardware apparel apparel sporting goods apparel apparel electronics apparel apparel general merchandise apparel general merchandise apparel apparel apparel general merchandise general merchandise apparel apparel apparel

11.2 Market Resources National Retail Federation, 325 7 th Street NW, Suite 1100, Washington, DC 20004. (202) 783-7971. (www.nrf.com)

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12 RETAIL CUSTOMER EXPERIENCE

12.1 Overview Since 2005, ForeSee (www.foresee.com) has conducted an annual Experience Index Survey to measure customer experiences with the largest retailers in the United States. The Index scores retailers on a 1-to-100 scale and assesses three retail formats: retail chain stores, e-commerce websites, and mobile experiences. This chapter presents the findings of the 2014 Experience Index Survey, which was conducted from October through December 2014. Retail companies included in the survey were Stores’ Top 100 Retailers and Internet Retailer’s Top 500 Web and Mobile Commerce Sites. These companies are listed in chapters 9 and 10, respectively, of this handbook.

12.2 Customer Satisfaction Leaders The 2014 Experience Index Survey assessed 21 multichannel retailers. Scores are as follows: Online

• • • • • • • • • • • • • • • • • • •

Apple: Barnes & Noble: Best Buy: Costco: CVS: Dick’s Sporting Goods: Gap: Home Depot: JCPenney: Kohl’s: Lowe’s: Macy’s: Nordstrom: Office Depot: Sears: Staples: Target: Toys “R” Us: Victoria’s Secret:

Store

80 78 77 78 76 76 75 79 77 80 78 78 77 77 75 77 73 77 78

82 83 78 80 75 77 76 79 76 79 79 76 80 78 74 77 80 73 80

M obile

80 80 78 79 75 77 79 77 78 79 77 76 80 79 76 80 78 78 80

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Walgreens: Walmart:

77 78

75 71

77 79

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Retail stores are ranked by Experience Index as follows: Barnes & Noble: 83 Apple: 82 Saks Fifth Avenue: 82 Advance Auto Parts: 81 Ann Taylor: 81 Costco: 80 Neiman Marcus: 80 Nordstrom: 80 OfficeMax: 80 Target: 80 Victoria’s Secret: 80 Williams-Sonoma: 80 Foot Locker: 79 Home Depot: 79 Kohl’s: 79 Lowe’s: 79 Best Buy: 78 GameStop: 78 Office Depot: 78 Abercrombie & Fitch: 77 Dick’s Sporting Goods: 77 Staples: 77 Gap: 76 JCPenney: 76 Macy’s: 76 CVS: 75 Express: 75 Walgreens: 75 Sears: 74 Toys “R” Us: 73 Walmart: 71

E-commerce websites are ranked by Experience Index as follows: Apparel/Accessories • L.L.Bean: 82 • The Children’s Place: 79 • Oriental Trading Company: 78 • Victoria’s Secret: 78 • Coach: 78 • Abercrombie & Fitch: 77

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Ann Taylor: Chico’s: dressbarn: Fanatics: Foot Locker: Neiman Marcus: Nordstrom: Ralph Lauren: Eddie Bauer: Express: lululemon athletica: American Eagle Outfitters: Blair: Gap: J.Crew: Saks Fifth Avenue: Shoebuy.com: Urban Outfitters: Gilt: NetaPorter: zulily: Fingerhut: Rue La La:

77 77 77 77 77 77 77 77 76 76 76 75 75 75 75 75 75 75 74 74 74 73 73

Automotive Parts/Accessories • Advance Auto Parts: 77 • U.S. Auto Parts: 77 • AutoZone: 76 Books/Music/Videos • Netflix: • Scholastic: • Barnes & Noble: • Google Play: • Hulu:

82 79 78 78 71

Computers/Electronics • Apple: • Newegg: • Sony Store Online: • Dell: • HP: • Microsoft: • TigerDirect.com:

80 80 79 78 78 78 78

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• •

Best Buy: Adobe:

77 74

Flowers/Gifts • 1-800-Flowers.com: • FTD:

77 75

Food/Drug • Edible Arrangements: • Keurig Green Mountain: • Walgreens: • CVS:

79 78 77 76

Hardware/Home Improvement • Home Depot: 79 • Lowe’s: 78 • Grainger: 75 Health/Beauty • Avon: • 1-800 Contacts: • Estée Lauder: • Vitacost.com: • Amway: • Weight Watchers:

82 79 79 78 77 75

Housewares/Home Furnishings • Williams-Sonoma: 78 • Crate and Barrel: 77 • Restoration Hardware: 77 • One Kings Lane: 76 • nomorerack: 75 • Wayfair.com: 72 Jewelry • Etsy: • Blue Nile:

77 76

Mass Merchant • Amazon: • QVC: • Kohl’s: • HSN: • Costco:

83 83 80 79 78 Retail Business Market Research Handbook 2015-2016

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• • • • • • • • •

Macy’s: Walmart: JCPenney: ShopHQ: Overstock.com: Sears: Hayneedle: Rakuten.com: Target:

78 78 77 77 75 75 74 74 73

Office Supplies • Office Depot: • Staples:

77 77

Specialty/NonApparel • Vistaprint: • Shutterfly: • Groupon Goods: • Shop.com:

81 79 78 74

Sporting Goods • Bass Pro Shops: • Cabela’s: • Nike: • REI: • Dick’s Sporting Goods:

80 79 77 77 76

Toys/Hobbies • Disney Store: • Musician’s Friend: • American Girl: • GameStop: • Toys “R” Us:

79 78 77 77 77

• • • • • • • • •

Mobile retail sites are ranked by Experience Index as follows: Amazon: 83 Fanatics: 82 L.L.Bean: 82 Newegg: 81 QVC: 81 Sony Store Online: 81 Apple: 80 Barnes & Noble: 80 Dell: 80

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Google Play: Nordstrom: Staples: Victoria’s Secret: Costco: Gap: HSN: Kohl’s: Office Depot: Walmart: Best Buy: JCPenney: Target: Toys “R” Us: Dick’s Sporting Goods: Etsy: Home Depot: Lowe’s: Walgreens: Macy’s: Overstock.com: Sears: CVS:

80 80 80 80 79 79 79 79 79 79 78 78 78 78 77 77 77 77 77 76 76 76 75

12.3 Market Resources ForeSee, 2500 Green Road, Suite 400, Ann Arbor, MI 48105. (800) 621-2850. (www.foreseeresults.com)

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13 TOP GROWTH CHAINS

13.1 Growth Chains Stores publishes an annual list of Hot 100 Retailers based on its ranking of chains by year-over-year sales growth. Published in August 2014, the most recent ranking is as follows: • Albertsons: 432.7% (includes merger activities) • Wayfair: 52.5% • Ascena Retail Group: 49.1% • Conn’s: 39.2% • SpartanNash: 36.6% • Michael Kors Holdings: 36.0% • Under Armour: 34.8% • Cardinal Health: 28.6% • Five Below: 27.8% • Amazon.com: 27.2% • Lululemon Athletica: 25.4% • Lumber Liquidators: 23.4% • H Mart: 23.0% • H&M: 22.8% • Vitamin Shoppe: 20.5% • Ulta Salon Cosmetics & Fragrance: 20.3% • Overstock.com: 18.6% • Sherwin-Williams: 18.1% • Rue21: 16.6% • Helzberg’s Diamond Shops: 15.7% • The Finish Line: 15.7% • Grocery Outlet: 15.5% • Sprouts Farmers Market: 15.5% • Jordan’s Furniture: 15.4% • Nebraska Furniture Mart: 15.4% • Cabela’s: 14.6% • Francesca’s Holdings: 14.5% • The Fresh Market: 14.3% • C & J Clark: 14.2% • Northgate Gonzalez Markets: 12.0% • Blue Nile: 11.6%

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Family Dollar Stores: Apple Stores/iTunes: Tractor Supply Co.: Whole Foods Market: AT&T Wireless: RaceTrac: J.Crew: Urban Outfitters: Dollar General: Tops Holding: Stripes: ValueVision Media: Harps Food Stores: 7-Eleven: Aldi: Petco: Bass Pro Shops: CARE Pharmacies Cooperative: Academy Sports + Outdoors: TJX: Sephora USA: O’Reilly Automotive: Superior Warehouse Groceries: Leslie’s Poolmart: Rouse’s Supermarkets: Signet Jewelers: Foodland Supermarket: Central Grocers: Festival Foods: Burlington Coat Factory: Cumberland Farms: Zumiez: Neiman Marcus: Foot Locker: GNC Holdings: AutoZone: The Home Depot: Dick’s Sporting Goods: Trader Joe’s: Crate & Barrel: Williams-Sonoma: Yankee Candle Company: Tilly’s: Wegmans Food Market:

11.4% 11.0% 10.7% 10.3% 10.2% 10.0% 9.3% 9.3% 9.2% 9.2% 9.2% 9.0% 9.0% 8.7% 8.5% 8.5% 8.2% 8.2% 8.0% 7.7% 7.6% 7.6% 7.5% 7.5% 7.5% 7.4% 7.4% 7.4% 7.3% 7.3% 7.1% 7.1% 7.0% 6.8% 6.8% 6.7% 6.6% 6.5% 6.4% 6.4% 6.2% 6.1% 6.1% 6.1%

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• • • • • • • • • • • • • • • • • • • • • • • • •

Wawa: Hibbett Sports: Thrifty White Drug Stores: Kinney Drugs: Lucky Brand Dungarees: Pilot Flying J: Coborn’s: Casey’s General Stores: WinCo Foods: Big 5 Sporting Goods: Ross Stores: Dollar Tree: Bed Bath & Beyond: Meijer: Publix: Costco: QuikTrip: Micro Center: L.L.Bean: Newegg.com: Pier 1 Imports: Ethan Allen Interiors: Bartell Drug: DSW: BJ’s Wholesale Club:

6.0% 5.9% 5.8% 5.8% 5.7% 5.7% 5.7% 5.7% 5.7% 5.6% 5.6% 5.6% 5.5% 5.3% 5.2% 5.2% 5.1% 5.1% 5.0% 5.0% 5.0% 5.0% 5.0% 4.9% 4.9%

13.2 Market Resources Stores, published by the National Retail Federation, 325 7 th Street NW, Suite 1100, Washington, DC 20004. (202) 783-7971. (www.nrf.com)

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14 MOST VALUABLE RETAIL BRANDS

14.1 Ranking By 2014 Valuation Interbrand (www.interbrand.com) assesses the following as the most valuable U.S. retail brands of 2014 (valuation change from prior year in parenthesis): • Walmart: $131.88 billion (-6%) • Target: $ 27.12 billion (8%) • The Home Depot: $ 25.70 billion (12%) • Amazon.com: $ 23.62 billion (27%) • CVS: $ 17.78 billion (12%) • Walgreens: $ 15.52 billion (8%) • Sam’s Club: $ 13.54 billion (no change) • eBay: $ 13.16 billion (20%) • Coach: $ 11.59 billion (-21%) • Publix: $ 10.16 billion (2%) • Lowe’s: $ 9.63 billion (9%) • Nordstrom: $ 8.96 billion (-12%) • Costco: $ 8.29 billion (13%) • Dollar General: $ 7.71 billion (8%) • Victoria’s Secret: $ 6.25 billion (2%) • Macy’s: $ 6.08 billion (393%) • Kohl’s: $ 5.83 billion (3%) • Tiffany & Co.: $ 5.44 billion (5%) • Staples: $ 4.93 billion (-11%) • Best Buy: $ 4.79 billion (-41%) • AutoZone: $ 4.67 billion (7%) • Avon: $ 4.61 billion (-11%) • Whole Foods: $ 4.16 billion (173%) • Gap: $ 3.92 billion (5%) • Bed Bath & Beyond: $ 3.86 billion (6%) • Old Navy: $ 3.21 billion (15%) • Sherwin-Williams: $ 3.11 billion (15%) • Ross Dress For Less: $ 2.44 billion (-5%) • GameStop: $ 2.34 billion (-8%) • T.J. Maxx: $ 2.12 billion (22%) • Michaels: $ 2.04 billion (4%) • Marshalls: $ 2.03 billion (19%)

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• • • • • • • • • • • • • • •

J.Crew: PetSmart: Banana Republic: Dick’s Sporting Goods: Dollar Tree: Tractor Supply Co.: Bath & Body Works: American Eagle Outfitters: Family Dollar: Urban Outfitters: Advance Auto Parts: Buckle: Cabela’s: Express: Chico’s:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $

1.87 billion (3%) 1.81 billion (10%) 1.80 billion (2%) 1.53 billion (-3%) 1.50 billion (14%) 1.50 billion (16%) 1.42 billion (7%) 1.29 billion (8%) 1.18 billion (17%) 1.12 billion (-5%) 1.11 billion (new) 1.08 billion (6%) 1.07 billion (27%) 983 million (15%) 932 million (new)

14.2 Market Resources Interbrand, 130 Fifth Avenue, New York, NY 10011. (212) 798-7500. (www.interbrand.com)

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15 TOP BRANDS IN SHOPPER SATISFACTION

15.1 Overview The American Customer Satisfaction Index (ACSI, www.theacsi.org) is a national economic indicator of satisfaction with the quality of products and services available to U.S. household consumers. Established in 1994, the ACSI produces indices of customer satisfaction on a 0-100 scale. The ACSI is based on about 65,000 interviews conducted annually, with 250 to 260 interviews completed per company/agency. Industry sample sizes vary from 750 to 10,000, depending on the number of measured companies in each industry. The ACSI is produced by the Stephen M. Ross Business School at the University of Michigan (www.bus.umich.edu), in partnership with the American Society for Quality (www.asq.org), and the international consulting firm CFI Group (www.cfigroup.com). ForeSee (www.foreseeresults.com) sponsors the e-commerce and e-business measurements. This chapter presents 2014 ACSI scores for retailers and consumer products.

15.2 Retailers ASCI scores for retailers are as follows (change from scores the year prior in parenthesis): Department and Discount Stores • Nordstrom: 83 (-1.2%) • Dillard’s: 81 (2.5%) • Kohl’s: 81 (no change) • Dollar General: 80 (2.6%) • JCPenney: 79 (-2.5%) • Target: 77 (-4.9%) • Sears: 77 (2.7%) • Macy’s: 76 (-2.6%) • Exchange: 75 (no change) • Walmart: 71 (no change) • All others: 79 (1.3%) • Sector average: 77 (no change)

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Drug Stores • CVS (Caremark): • Walgreen: • Rite Aid: • All others: • Sector average:

76 (1.6%) 76 (no change) 74 (-3.9%) 83 (5.1%) 79 (2.6%)

Internet Retail • Amazon.com: • Newegg: • eBay: • Overstock.com: • Netflix: • All others: • Sector average:

88 (3.5%) 83 (-1.2%) 80 (-3.6%) 79 (-2.5%) 79 (5.3%) 85 (-8.5%) 78 (-4.9%)

Specialty Retail Stores • Costco: • Barnes & Noble: • OfficeMax: • Lowe’s: • Staples: • Sam’s Club: • Office Depot: • Home Depot: • TJX: • Best Buy: • Gap: • All others: • Sector average:

84 (1.2%) 82 (no change) 82 (5.1%) 82 (3.8%) 81 (2.5% 80 (no change) 79 (-6.0%) 79 (2.6%) 79 (3.9%) 77 (-1.3%) 77 (1.3%) 79 (2.6%) 80 (2.6%)

Supermarkets • Publix: • Kroger: • Whole Foods: • Supervalu: • Winn-Dixie: • Safeway: • Walmart: • All others: • Sector average:

86 (no change) 80 (1.3%) 78 (-2.5%) 77 (1.3%) 77 (-1.3%) 76 (1.3%) 72 (no change) 81 (3.8%) 77 (1.3%)

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15.3 Consumer Products ASCI scores for consumer products brands are as follows (change from scores the year prior in parenthesis): Apparel • VF: 84 (3.7%) • Jones Group: 81 (1.3%) • Levi Strauss: 80 (-2.4%) • Hanesbrands: 78 (-3.7%) • All others: 77 (-1.3%) • Sector average: 78 (-1.3%) Athletic Shoes • Nike: • adidas: • All others: • Sector average:

78 (no change) 77 (-3.8%) 81 (-2.4%) 80 (-1.2%)

Food Products • H.J. Heinz: • Hershey: • Mars: • Quaker (PepsiCo): • Néstle: • General Mills: • Kraft: • Dole: • Campbell Soup: • ConAgra: • Hillshire Brands: • Kellogg: • Tyson Foods: • All others: • Sector average:

87 (no change) 86 (no change) 85 (1.2%) 85 (-2.3%) 85 (2.4%) 85 (-2.3%) 84 (-2.3%) 83 (-1.2%) 82 (-1.2%) 82 (-1.2%) 82 (-2.4%) 81 (-4.7%) 79 (-1.3%) 77 (-3.8%) 79 (-2.5%)

Major Appliances • Whirlpool: • Electrolux: • General Electric: • All others: • Sector average:

81 (-1.2%) 79 (1.3%) 77 (-3.8%) 81 (1.3%) 80 (no change)

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Personal Care and Cleaning Products • Clorox: 85 (no change) • Colgate-Palmolive: 83 (-2.4%) • Procter & Gamble: 84 (-2.4%) • Dial: 81 (-3.6%) • Unilever: 80 (-5.9%) • All others: 82 (no change) • Sector average: 82 (-1.2%) Personal Computers • Apple: • Acer: • Dell: • Toshiba: • Hewlett-Packard: • All others: • Sector average:

84 (-3.4%) 76 (-1.3%) 76 (-3.8%) 75 (-3.8%) 74 (-7.5%) 82 (7.9%) 78 (-1.3%)

Soft Drinks • Coca-Cola: • PepsiCo: • Dr. Pepper Snapple: • All others: • Sector average:

83 (-1.2%) 83 (-2.4%) 82 (-4.7%) 80 (-2.4%) 82 (-2.4%)

15.4 Market Resources American Customer Satisfaction Index (ACSI), 625 Avis Drive, Ann Arbor, MI 48108. (734) 913-0788. (www.theacsi.org) ForeSee, 2500 Green Road, Suite 400, Ann Arbor, MI 48105. (800) 621-2850. (www.foreseeresults.com)

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PART III: ANALYSES

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16 AIRPORT RETAIL

16.1 Market Assessment According to ARN Fact Book, 2014 Edition, published by Airport Revenue News (www.airportrevenuenews.com), annual retail spending (excluding duty-free purchases) at the 50 largest airports in North America is $2.1 billion. Retail spending per enplaning passenger is approximately $3.50. Spending by type of retail outlet is as follows: • News & gifts: $1.1 billion • Specialty retail: $1.0 million _________________________________________________________________

“North American airports have made remarkable strides over the past dozen years. Airports have reconfigured their terminals and added concession space to meet the traveling public’s needs and wants. Retail has shifted in myriad ways to adapt to new demands from customers.” Ramon Lo, Editorial Director Airport Revenue News, 9/14 _________________________________________________________________

Many major airports are recognized for great shopping. The Pittsburgh International Airport, which pioneered the ‘air mall’ shopping concept, has a variety of 65 retail shops. The retail mix at Denver International Airport includes several shops offering locally made items such as handmade crafts from area artists as well as Native-American jewelry. Minneapolis-St. Paul International Airport has so many retail options it has been dubbed ‘mini-Mall of America.’ Because of the heavy foot traffic, retail sales per square foot at many airports top $1,000 or more, or nearly double that at regional malls and upscale outlets, according to National Real Estate Investor.

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16.2 Top Airports For Retail The following airports had the highest food and beverage sales (source: ARN Fact Book): Specialty Retail • Hartsfield-Jackson Atlanta International Airport: $73.9 million • John F. Kennedy International Airport (New York City): $63.9 million • San Francisco International Airport: $57.3 million • Miami International Airport: $54.2 million • Orlando International Airport: $45.2 million • Dallas-Fort Worth International Airport: $41.8 million • McCarran International (Las Vegas): $40.3 million • Denver International Airport: $33.5 million • Newark Liberty International Airport: $32.2 million • Chicago O’Hare International Airport: $31.2 million News & Gifts • Los Angeles International Airport: • John F. Kennedy International Airport (New York City): • Chicago O’Hare International Airport: • Charlotte/Douglas International Airport: • McCarran International (Las Vegas): • Miami International Airport: • Newark Liberty International Airport: • Seattle-Tacoma International Airport: • San Francisco International Airport: • Hartsfield-Jackson Atlanta International Airport:

$77.9 million $74.0 million $49.6 million $46.6 million $46.6 million $39.9 million $38.3 million $37.4 million $36.4 million $36.1 million

16.3 Duty-Free Retail ARN Fact Book, 2014 Edition, reported duty-free retail sales at the 50 largest airports at $1.04 billion. The following airports had the highest duty-free sales: • John F. Kennedy International Airport (New York City): $212.2 million • Los Angeles International Airport: $163.5 million • Miami International Airport: $116.3 million • San Francisco International Airport: $104.9 million

16.4 Market Resources Airport Revenue News, 3200 North Military Trail, Suite 110, Boca Raton, FL 33431. (561) 477-3417. (www.airportrevenuenews.com)

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17 AUTOMOTIVE PARTS STORES

17.1 Market Assessment According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at automotive, accessories, and tire stores (NAICS Code 4413) have been as follows: • 2004: $66.78 billion • 2005: $70.06 billion • 2006: $72.28 billion • 2007: $74.74 billion • 2008: $76.25 billion • 2009: $74.09 billion • 2010: $77.74 billion • 2011: $82.49 billion • 2012: $82.92 billion • 2013: $81.69 billion • 2014: $82.07 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 6.32 billion February: $ 6.38 billion March: $ 7.10 billion April: $ 7.04 billion May: $ 7.08 billion June: $ 6.90 billion July: $ 7.13 billion August: $ 7.04 billion September: $ 6.76 billion October: $ 7.19 billion November: $ 6.71 billion December: $ 6.35 billion

17.2 Market Leaders The largest automotive parts store chains, ranked by annual U.S. sales, are as follows:

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• • •

Autozone (www.autozone.com): O’Reilly Automotive (www.oreillyauto.com): Advance Auto Parts (www.advanceautoparts.com):

$7.58 billion $6.64 billion $6.44 billion

17.3 Sector Profile Automotive Parts & Accessories Stores Industry Profile, a January 2015 publication by First Research (www.firstresearch.com), provides the following profile of the segment: • The U.S. automobile parts retail sector includes about 40,000 establishm ents (single-location companies and units of multi-location companies). • The industry is concentrated: the 50 largest companies generate about half of industry revenue. • Demand for automobile parts is driven by the age and mileage of vehicles in use and generally increases when fewer new cars are sold and older cars are kept on the road longer. • The profitability of individual companies depends largely on inventory management and marketing. Large companies have economies of scale in purchasing and distribution. Small companies can compete effectively by carrying specialized parts or by providing extra services such as fast delivery. • The industry is labor-intensive: average annual revenue per employee is about $127,000. • Auto parts account for about 50% of retail sales; auto supplies 12%; and auto batteries and auto lubricants about 6% each.

17.4 Customer Shopping International Demographics (www.themediaaudit.com) has surveyed adults in 93 metropolitan areas assessing the percentages that shop at automotive parts stores. On average, 29.9% of adults in the 93 metropolitan areas assessed reportedly shopped at an automotive parts store in the prior month. The following metropolitan areas have the highest percentages of adults that shop at automotive parts stores monthly: • Ocala, FL: 39.4% • Tulsa, OK: 39.4% • Lexington, KY: 37.8% • Charleston, SC: 37.5% • Flint-Saginaw, MI: 37.3% • Spokane, WA: 37.3% • Atlanta, GA: 37.2% • Norfolk-Virginia Beach-Newport News, VA: 36.7% • Greenville-Spartanburg, SC: 36.5% • Birmingham, AL: 36.4%

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Data on customer shopping at automotive parts stores in the 93 metropolitan areas is available online at www.themediaaudit.com/press/local-releases.

17.5 Market Resources Automotive Parts & Accessories Stores Industry Profile, First Research, January 2015. (www.firstresearch.com/Industry-Research/Automotive-Parts-and-Accessories-Stores.html) First Research, Hoover’s Inc., 5800 Airport Boulevard, Austin, TX 78752. (866) 788-9389. (www.firstresearch.com) International Demographics, 10333 Richmond Avenue, Suite 200, Houston, TX 77042. (713) 626-0333. (www.themediaaudit.com)

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18 BABY PRODUCTS

18.1 Market Assessment Total U.S. spending in 2013 for baby products of all types was $49 billion. The market has declined slightly since 1998. _________________________________________________________________

“The last place parents cut spending is on their kids, but economic troubles, resulting birth rate declines, and other factors have caused sales of baby food and babycare supplies to decline over the last five years.” Bloomberg BusinessWeek _________________________________________________________________

According to IBIS World (www.ibisworld.com), the U.S. market for baby and kids’ clothing dipped 9.2% during the recession, and revenue fell from $10.3 billion in 2007 to $9.4 billion a year later. The category has rebounded; sales were $10.6 billion in 2014, 4.3% over the prior year. According to Packaged Facts (www.packagedfacts.com), annual retail sales of the baby food category, including both infant formula and prepared baby food, are $5.7 billion. The category has been declining by a compound average growth rate (CAGR) of 2.5% since 2008. Sales were hammered by the recession and continued to suffer as lingering economic stress led to declining birth rates and reduced spending by consumers. An increase in breastfeeding, as well as infants and toddlers being fed what the family eats, further depressed sales. Health and safety concerns over formula, which accounts for over 70% of category sales, also contributed to the decline. Annual retail sales of the babycare supplies category, consisting of the diapers, wipes, and baby personal care segments, are $5.8 billion. The category declined by a CAGR of 1.3% since 2008. Eroding diapers sales, at over 60% of the category, drove overall sales declines due to the same economic factors affecting baby food. Wipes

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and baby personal care products, much less expensive for consumers than diapers, experienced sales growth during the period, but at sluggish rates. According to Companies and Markets (www.companiesandmarkets.com), the baby care and safety accessory market was $2.3 billion in 2013; CAGR is projected at 8% through 2018. This category includes strollers and car seats. An April 2014 study by IBIS World reported annual online spending for baby products is $6 billion; average annual growth is 13.3%. Approximately 4,000 suppliers sell baby products online.

18.2 Market Leaders According to Packaged Facts, Nestle/Gerber, Abbott Laboratories, and Mead Johnson Nutrition control nearly 90% of the baby food category. Gerber is dominant in prepared baby food, while Abbott and Mead are dominant in infant formula. Kimberly-Clark and Procter & Gamble garner 65% of dollar sales of the baby care supplies category due to their strength in diapers and wipes. Johnson & Johnson controls half of the smaller baby personal care segment. Ranked by marketshare, the leading baby care and safety accessory vendors in the U.S. are as follows: • Dorel Juvenile Group: 19.6% • Graco: 13.6% • Evenflo Products Co: 11.9% • Munchkin Inc.: 7.5% • Playtex Products: 6.6% • Tomy: 6.3% • Summer Infant Inc: 5.2% • Harmony Juvenile Products: 3.3% • Fisher Price: 2.9% • Boppy Co: 2.0%

18.3 Market Resources Baby Food and Babycare Supplies: U.S. Market Trends, Packaged Facts, 2013. (www.packagedfacts.com/Baby-Food-Babycare-7124912) Online Baby Product Sales in the U.S.: Market Research Report , IBIS World, April 2014. (www.ibisworld.com/industry/online-baby-product-sales.html) U.S. Baby Products Market, Companies and Markets, 2014. (www.companiesandmarkets.com)

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19 BOOK STORES

19.1 Market Assessment According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at book stores (NAICS Code 451211) have been as follows: • 2004: $16.88 billion • 2005: $16.99 billion • 2006: $16.98 billion • 2007: $17.17 billion • 2008: $16.87 billion • 2009: $15.94 billion • 2010: $15.44 billion • 2011: $13.92 billion • 2012: $12.47 billion • 2013: $11.90 billion • 2014: $11.38 billion

• • • • • • • • • • • •

These figures do not include book sales at general merchandise stores. Sales in 2014 were distributed by month as follows: January: $ 1.50 billion February: $ 732 million March: $ 683 million April: $ 684 million May: $ 794 million June: $ 702 million July: $ 708 million August: $ 1.68 billion September: $ 1.06 billion October: $ 731 million November: $ 736 million December: $ 1.35 billion

19.2 Marketshare Leaders The largest book store chains, ranked by annual revenue, are as follows:

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• • •

Barnes & Noble (www.barnesandnoble.com): Follett Higher Education Group (www.follett.com): Books-A-Million (www.booksamillion.com):

$6.1 billion $2.7 billion $ 470 million

Barnes & Noble, the number one bookseller in the U.S., accounts for one out of every 10 books sold. It is the largest U.S. retailer in every segment of its sales, including bargain books, magazines, newspapers, children’s books, art books, and calendars. Borders Group, once the second-largest operator of book superstores in the U.S., filed for Chapter 11 bankruptcy in 2011 and ultimately closed all of its stores. Borders’ online division was sold to Barnes & Noble.

19.3 Sector Profile Bookstores Industry Profile, published in December 2014 by First Research (www.firstresearch.com), provides the following profile of the segment: • The U.S. bookstores sector includes about 8,500 stores with combined annual revenue of about $13 billion. The industry is highly concentrated: the 50 largest companies account for about 85% of sales. • The industry is labor-intensive: average annual sales per employee are about $130,000. Sales per employee tend to be lower for smaller, independent bookstores. • The industry is being redefined as booksellers fend off intense competition from discount stores and online retailers and adjust to increasing acceptance by consumers of digital books as an alternative to printed books. • The industry is segmented into general, college, and specialty bookstores. General bookstores sell mostly trade books (fiction, nonfiction, adult, children’s), college bookstores sell mostly textbooks, and specialty bookstores sell mostly religious books. Trade books account for about 35% of sales, textbooks for nearly 30%, and religious books about 5%.

19.4 Independent Book Stores There are approximately 1,900 independent bookshops in the U.S., according to the American Booksellers Association (www.bookweb.org). While Amazon holds 29% of the book market, followed by Barnes & Noble with 20% marketshare, independent booksellers garner 10% of book sales.

19.5 E-Books According to Pew Research Center (www.pewresearch.org), over 50% of adults own a tablet, an e-reader, or both devices. Among these consumers, the following

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percentages read eBooks on their devices: • E-reader: 87% • Tablet: 78% • Smartphone: 32% • Computer: 31% In a 2014 survey by Harris Interactive (www.harrisinteractive.com), adults reported their reading activities as follows: • Only read print books: 48% • Read more print books than eBooks: 17% • Read print books and eBooks about the sam e: 14% • Read more eBooks than print books: 15% • Only read eBooks: 6%

• • • •

E-book sales are distributed by outlet as follows: Amazon: 67% Barnesandnoble.com: 25% Apple iBookstore: 5% Smashwords: 1%

19.6 Market Resources American Booksellers Association, 333 W estchester Avenue, Suite S202, White Plains, NY 10604. (800) 637-0037. (www.bookweb.org) Bookstores Industry Profile, First Research, December 2014. (www.firstresearch.com/Industry-Research/Bookstores.html)

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20 BRIDAL & WEDDING MARKET

20.1 Market Assessment The U.S. wedding industry – from caterers to jewelers to travel agents – is a more than $100 billion-per-year business. There are approximately 2.1 million marriages each year in the U.S., or a rate of 5.4 per 1,000 population. According to the U.S. Census Bureau (www.census.gov), the rate of marriages has dropped in recent years, declining from 9.8 per 1,000 in 1990 and 8.3 per 1,000 in 2000. The 2014 Wedding Survey by Brides magazine reported spending for the average wedding at $28,202, an increase of $1,213 since 2012. The reception accounts for 43% of wedding costs, with an average price of $12,343. Outside of the reception, the highest spending is for engagement rings ($5,002), photography and video ($3,378), music ($1,297), and wedding rings ($1,727). The average wedding cake costs $461. The average wedding dress costs $1,380 and the average bridesmaids’ dress costs $134. _________________________________________________________________

“A typical American wedding costs $25,000 or so. This has fallen a bit over the past quartercentury but still seems lavish given how tight American belts are these days. Weddings are pricey because the rich are more likely to marry than the poor, and the average age of newlyweds has gone up, so couples are more prosperous when they eventually tie the knot.” The Economist, 10/11/14 _________________________________________________________________

The Brides survey also found couples were engaged, on average, for 14.7 months, most brides had two bridal showers, and the average number for guest lists was 153. Of note in the survey is the finding that 36% of couples fund their own wedding, up from 29% in 2009.

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20.2 Engagement and After-Wedding Shopping According to Condé Nast Bridal Group, the average couple is engaged for 16 months. Many engaged couples plan for a new household as well as the wedding. According to HFN, over a 17-month period following their wedding newlyweds spend as follows: • Automotive: $31 billion • Insurance: $15 billion • Financial services: $12 billion • Furniture: $ 4 billion • Housewares: $ 3 billion

20.3 Wedding-Gift Giving In a recent survey by Claria Corporation (www.claria.com), 75% of respondents said they planned to attend one to three weddings during the coming 12-month period. Thirty-four percent (34%) had or planned to purchase wedding gifts through online retail channels, with 80% planning to buy their gifts from the bride and groom’s registry. Forty-eight percent (48%) of respondents indicated they would purchase a wedding gift in the coming three months. Of those, 43% planned to buy online; 83% planned to purchase a gift requested in the bride and groom’s gift registry. Sixty-five percent (65%) typically buy gifts for all couples who invite them to a wedding, 30% only purchase gifts for weddings they attend. Sixty percent (60%) of respondents reported spending $26 to $75 for a wedding gift.

20.4 Wedding Registries An estimated $20 billion is spent annually on presents bought via wedding gift registries. Online registries – both specialized online websites and those sponsored by traditional retailers – have become popular in recent years. One of the oldest specialized wedding sites is www.TheKnot.com. Publisher Condé Nast sponsors www.WeddingChannel.com. Other popular registry sites include www.ElegantBride.com and www.ModernBride.com, which typically attract the younger population, and www.4Wedding.com, which attracts mostly older married-to-be’s to their site. According to the American Wedding Study, by Brides magazine, the mostwanted gifts among brides-to-be are as follows: • Money: 67% • Cookware: 52% • Linens/towels: 49% • Small kitchen appliances: 47% • Gift cards: 43%

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• • • • • • • • • • •

Everyday dishes: Home decor: Everyday glassware: Honeymoon: Fine china: Stainless steel flatware: Electronics: Furniture and furnishings: Silver flatware: Large kitchen appliances: Crystal:

39% 31% 24% 23% 21% 18% 18% 14% 14% 14% 13%

The Bridal Registry Study, by The Knot Market Intelligence (www.knot.com), provides the following assessment of the bridal registry market: • The vast majority (88%) of engaged couples set up a registry. • Sixty-one percent (61%) of registering couples use a personal wedding website – one they set up themselves with details about the wedding, the reception, how they met, where they are registered, and other information – to communicate information to their guests. Brides between the ages of 25 and 34 are most likely to spread word of their registries using personal websites. • Twelve percent (12%) of registering couples use social networking platforms to share registry details with friends and family. Younger brides (aged 18-to-24) are more likely to use social networking tools. • Engaged couples typically register at an average of three retail stores. The top three wedding registry retailers are Bed Bath and Beyond, Target, and Macy’s, which account for 70% of bridal registries.

20.5 Millennial-Generation Weddings Those born 1980 thru 2000, a span of 20 years, are generally classified as the Millennial generation (also known as Generation Y or Echo Boomers). According to the U.S. Census Bureau, the Millennial generation numbers approximately 82 million. The boom in weddings that will accompany the aging of this generation is already being anticipated. According to the HFN Bridal Report, in January 2015 there were about 2.4 million 27-year old females – the average age of today’s bride.

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_________________________________________________________________

“There is good news on the bridal front: the number of women approaching marital age (roughly 27) will grow tremendously in the coming years. In fact, the millennial generation is three times bigger than its predecessor, Generation X, and its buying power will be considerable.” HFN Bridal Report _________________________________________________________________

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21 CONSUMER ELECTRONICS

21.1 Market Assessment According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at consumer electronics (CE) and household appliance stores (NAICS Code 443) have been as follows: • 2004: $ 94.42 billion • 2005: $101.34 billion • 2006: $107.99 billion • 2007: $110.67 billion • 2008: $108.66 billion • 2009: $ 98.03 billion • 2010: $ 99.13 billion • 2011: $100.89 billion • 2012: $102.99 billion • 2013: $104.30 billion • 2014: $107.28 billion note: Figures do not include consumer electronics sales at general merchandise stores.

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 7.96 billion February: $ 8.14 billion March: $ 8.60 billion April: $ 7.66 billion May: $ 8.13 billion June: $ 7.98 billion July: $ 8.25 billion August: $ 8.59 billion September: $ 8.69 billion October: $ 8.55 billion November: $ 11.09 billion December: $ 13.59 billion

According to the Consumer Electronics Association (CEA; www.ce.org), the total U.S. consumer electronics market in 2014 was $211.3 billion, a 2.0% increase from $207.0 billion in 2013, based on U.S. f actory sales-to-dealers.

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21.2 Marketshare Leaders The largest electronics chains, ranked by annual U.S. revenue, are as follows: • Best Buy (www.bestbuy.com): $35.8 billion • RadioShack (www.radioshack.com): $ 2.3 billion • Fry’s Electronics (www.frys.com): $ 2.1 billion • hhgregg (www.hhgregg.com): $ 1.5 billion • P.C. Richard & Son (www.pcrichard.com): $ 1.3 billion • BrandsMart USA (www.brandsmartusa.com): $ 1.1 billion RadioShack, the second-largest company in the sector, filed for bankruptcy in February 2015. The NPD Group ranked CE marketshare leaders as follows: Bricks-and-Mortar • Best Buy • Walmart • Staples • Target • Apple Online • Dell • Amazon.com • BestBuy.com • Hewlett-Packard (www.hp.com) • Apple

21.3 Household Use Of CE Products The 16th Annual Household CE Ownership and Market Potential Study, published in January 2015 by the CEA, reported the average U.S. household spent $1,338 on consumer electronics products in 2014, an increase of 36% over the previous year. The following are other findings of the report: Top Consumer Electronics Purchases • The top CE purchases were smartphones (27%) and over- or on-the-ear headphones (27%). Also among the top purchases were televisions (20%); laptop, notebook or netbook computers (18%); and tablets (16%). Market Penetration Growth • The following products had the highest 2013-2014 growth in market penetration:

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-

Internet-enabled TV: Blu-ray disc player: Tablet: Smartphone: Portable wireless speakers, Bluetooth, Wi-Fi or airplay-enabled:

2013

2014

15% 31% 39% 58%

24% 39% 45% 64%

9 percentage points 8 percentage points 6 percentage points 6 percentage points

Increase

25%

30%

5 percentage points

Smartphones • Sixty-four percent (64%) of U.S. households owned a smartphone in 2014, surpassing ownership of basic cellphones for the first time. Emerging Technologies • Smart watch ownership was under 2% in mid-2014 and is expected to more than triple in 2015. • Eight percent (8%) of households expect to own a fitness activity tracker by 2015, up from 5% in 2014. • Smart thermostat ownership is expected to grow from 3% of households to 5% of households by 2015.

21.4 Market Forecast CEA projects revenues for the U.S. consumer electronics industry to grow 3% in 2015 to $223.2 billion. CEA forecasts are as follows: Emerging Technologies • Revenue for emerging product categories is expected to grow 108% year-over-year in 2015. These new technology categories include 3D printers, 4K Ultra-High Definition televisions, connected thermostats, unmanned systems (unmanned aerial vehicles, unmanned vehicles, and home robots), IP cameras and wearables such as health and fitness devices, smart watches, and smart eyewear. • While the emerging product categories represent less than 5% of the entire CE industry revenue forecast, they are expected to contribute almost $11 billion to overall CE revenue in 2015. Wearables • The wearables category encompasses fitness activity bands and other health and fitness devices, smart watches, and smart eyewear. • CEA projects overall wearable unit sales will reach 30.9 million units, a 61% increase from 2014, and generate $5.1 billion in revenue in 2015, a 133% increase.

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•

•

Led by the popularity of activity tracking devices, health and fitness devices will lead unit sales among all wearables in 2015 with a projected 20 million units. Revenue is expected to surpass $1.8 billion in 2015. Sales of smart watches are expected to take off in 2015, with 10.8 million unit sales, a 359% increase, and a projected earning of $3.1 billion in revenue, a 474% increase over 2014.

Product Sales Leaders • Representing 34.1% of total CE industry revenue, sales of mobile connected devices, specifically smartphones and tablets, will continue to stand as the top two revenue drivers of the CE bottom line in 2015. Although revenue growth for these categories has slowed as the category has matured, unit sales will continue to see increases. • Smartphone unit shipments are projected to reach 169.3 million in 2015, up 6% from 2014. Revenues are projected at $51.3 billion in 2015, a 5% increase f rom 2014. Significant growth will be seen in screen sizes of between 5.3 inches and 6.5 inches. • Unit sales of tablets are projected to reach 80.7 million, a 3% increase from 2014. Revenues for tablets will reach $24.9 billion in 2015, down 1% from 2014. Video • Larger screen sizes and innovative display features have more consumers upgrading their video experience. TV sales remain critical as the industry’s third-largest contributor to the total revenue, with sales of TV sets and displays projected to reach $18.3 billion in 2015, down 2% from 2014. • The market growth of 4K Ultra High-Definition TV was better than expected in 2014. Strong growth is expected in 2015. Unit shipments of 4K UHD displays are projected to reach four million in 2015, a 208% increase. Revenue is expected to exceed $5 billion in 2015, a 106% increase. Other CE Products • Positive growth for audio, electronic gaming, and laptops is expected in 2015. Automotive electronics will see continued growth due to new vehicle sales in 2015, with projections of $14 billion in revenue, a 3.3% increase.

21.5 Market Resources Consumer Electronics Association, 1919 South Eads Street, Arlington, VA 22202. (866) 858-1555. (www.ce.org) The NPD Group, Consumer Tracking Service, 900 West Shore Road, Port Washington, NY 11050. (516) 625-0700. (www.npd.com)

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22 CONVENIENCE STORES

22.1 Sector Profile Convenience stores account for 34% of all retail outlets in the United States. The National Association of Convenience Stores (NACS, www.nacsonline.com) reported the U.S. convenience store (c-store) count was 152,794 stores at year-end 2014, a 1% increase from a year prior. The following states have the highest number of convenience stores: • Texas: 15,434 • California: 11,403 • Florida: 9,810 • New York: 8,247 • Georgia: 6,766 • North Carolina: 6,301 • Ohio: 5,539 • Michigan: 4,907 • Illinois: 4,670 • Pennsylvania: 4,604 The three states with the fewest c-stores are Alaska (202), Delaware (348), and Wyoming (354). The convenience retailing industry has roughly doubled in size over the last three decades. At year-end 1984, the store count was 85,300, at year-end 1994 the store count was 98,200, and at year-end 2004 the store count was 138,205. There were 127,588 convenience stores selling fuel in the United States at year-end 2014, and these retailers sell an estimated 80% of all the fuel purchased in the country.

22.2 Market Assessment According to NACS State of the Industry Report of 2013 Data , 27th Edition, U.S. convenience stores reached record in-store sales in 2013, with sales climbing 2.4% to $204 billion. Combined with motor fuel sales of $491.5 billion, overall convenience store sales were $695.5 billion. Among the in-store categories, foodservice drove profits, accounting for 28.9% of gross profit dollars. Packaged beverages were second, accounting for 19.7% of gross profit dollars. Overall, motor fuel accounted for 71.5% of

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total sales. The convenience retailing industry continues to be dominated by single-store operators, which account for 63.0% of all convenience stores (96,318 stores total) and 83.5% of store growth in 2013.

22.3 Marketshare Leaders The largest convenience store chains, ranked by annual U.S. sales, are as follows: • Pilot Travel Centers (www.pilotcorp.com): $17.0 billion • Love’s Travel Stops (www.loves.com): $12.6 billion • 7-Eleven (www.7-eleven.com): $11.6 billion • QuikTrip (www.quiktrip.com): $ 7.3 billion • Cumberland Farms (www.cumberlandfarms.com): $ 6.6 billion • The Pantry (www.thepantry.com): $ 6.4 billion • TravelCenters of America (www.tatravelcenters.com): $ 6.0 billion • Wawa (www.wawa.com): $ 5.9 billion • RaceTrac Petroleum (www.racetrac.com): $ 4.7 billion • Sheetz (www.sheetz.com): $ 4.0 billion

22.4 Market Resources Convenience Store Monitor, The NPD Group, 900 West Shore Road, Port Washington, NY 11050. (516) 625-0700. (www.npd.com) Convenience Stores & Truck Stops Industry Profile, First Research, November 2014. (www.firstresearch.com/Industry-Research/Convenience-Stores-and-Truck-Stops.html) National Association of Convenience Stores, 1600 Duke Street, 7 th Floor, Alexandria, VA 22314. (703) 684-3600. (www.nacsonline.com)

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23 CRAFTS & HOBBY STORES

23.1 Market Assessment The Craft & Hobby Association (CHA, www.craftandhobby.org) estimates the annual market for craft and hobby supplies at $31 billion. According to State of the Craft Industry, published by CHA, 56% of U.S. households, or 62.5 million people, participate in one or more crafting activities. An estimated 35 million people sew, 16 million knit or do needlepoint, and 12 million quilt. The American Quilter’s Society (www.americanquilter.com) estimates that quilting is a $3.3 billion industry, with some 27 million enthusiasts – a figure which includes collectors, those who enjoy quilt exhibits, and quilt makers themselves. Scrapbooking, a $2 billion market, has been one of the hottest growth areas in the crafts market during the past decade.

23.2 Marketshare Leaders The largest crafts and fabrics chains, ranked by annual U.S. sales, are as follows: • Michaels Stores (www.michaels.com): $4.13 billion • Hobby Lobby Stores (www.hobbylobby.com): $3.00 billion • Jo-Ann Stores (www.joann.com): $2.20 billion • A.C. Moore Arts & Crafts (www.acmoore.com): $ 535 million • Hancock Fabrics (www.hancockfabrics.com): $ 275 million The following are the largest craft supply chains, ranked by number of U.S. locations as of August 2014: • Michaels (www.michaels.com): 1,040 • Jo-Ann Stores (www.joann.com): 750 • Hobby Lobby (www.hobbylobby.com): 572 • A.C. Moore Arts & Crafts (www.acmoore.com): 135 Etsy (www.etsy.com), the dominant online marketplace for artisanal goods, has one million storefronts and more than $1 billion in annual sales.

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23.3 Market Characteristics and Trends It is well understood in the fabric and crafts sector that people’s necessity to ‘do it themselves’ faded a long time ago. The primary market drivers today are recreation, enjoyment, and family values. People are not sewing as a necessity, rather it is a lifestyle and hobby choice. What the fabric and craft chains have been able to do, perhaps better than any other retail segment, according to Chain Store Age, is to create a comfortable and exciting environment for their shoppers. In addition to the leisure-related market drivers, there is a trend toward making a gift for someone special, instead of buying it off a shelf. Consumers are also using crafts as a way to add uniqueness to their homes. Despite the image of crafts as a hobby for the retired, crafts retailers report that almost 50% of arts and crafts shoppers are ages 35-to-54.

23.4 Market Resources American Craft Council, 1224 Marshall Street NE, Suite 200, Minneapolis, MN 55413. (612) 206-3100. (www.craftcouncil.org) Craft & Hobby Association, 319 East 54 th Street, Elmwood Park, NJ 07407. (201) 835-1200. (www.craftandhobby.org)

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24 DEPARTMENT STORES

24.1 Market Assessment According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at department stores, including leased departments (NAICS Code 452111), have been as follows: • 2004: $87.26 billion • 2005: $87.46 billion • 2006: $82.66 billion • 2007: $79.02 billion • 2008: $72.80 billion • 2009: $64.35 billion • 2010: $65.57 billion • 2011: $66.35 billion • 2012: $63.41 billion • 2013: $61.39 billion • 2014: $61.02 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 3.52 billion February: $ 4.12 billion March: $ 4.70 billion April: $ 4.70 billion May: $ 5.08 billion June: $ 4.56 billion July: $ 4.27 billion August: $ 4.76 billion September: $ 4.32 billion October: $ 4.69 billion November: $ 6.40 billion December: $ 9.83 billion

24.2 Marketshare Leaders The largest department store chains, ranked by annual U.S. sales, are as follows:

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•

Macy’s (www.macys.com):

$27.9 billion

Brands: Bloomingdale’s, Macy’s

•

Sears Holdings Corp. (www.sears.com):

$26.6 billion

Brands: Kmart, Sears

• • • • •

Kohl’s (www.kohls.com): Nordstrom (www.nordstrom.com): JCPenney (www.jcpenney.com): Dillard’s (www.dillards.com): Neiman Marcus Group (www.neimanmarcus.com):

• • •

Belk (www.belk.com): Saks Fifth Avenue (www.saks.com): Bon-Ton Stores (www.bonton.com):

$19.0 billion $12.4 billion $11.8 billion $ 6.4 billion $ 4.6 billion

Brands: Bergdorf Goodman, Last Call, Neiman Marcus

$ 4.0 billion $ 2.8 billion $ 2.8 billion

24.3 Market Trends Department stores accounted for 10% of total retail sales in the mid-1980s, 8% in 1990, 5% in 2000, and 2.2% in 2014. Departm ent store sales have been on the decline for more than a decade, and declines accelerated during the recession. In an effort to curb declines, department stores are reinventing the store shopping experience. Stores are adding automated price checkers, shopping carts, more direction signage, and easier-to-shop layouts. Some are introducing centralized checkouts to ensure that manned registers are always available to shoppers. Others have increased the size of fitting rooms and have added mirrors and extra racks to hang more clothes. While department store retailers are not abandoning the mall, many are exploring formats that allow them to reach new customers in new locations, typically with smaller stores. Several department-store chains are developing free-standing locations, taking their cue from the convenience offered by Kohl’s with their off-mall locations. Consolidation of store locations continues. Macy’s announced plans to close 14 stores in 2015 as part of a restructuring plan aimed to boost online sales. The closures will leave Macy’s with 780 stores. JCPenney plans to close 40 stores in 2015, or about 4% of the chain’s total locations.

24.4 Market Resources Department Stores, Chain Store Guide, 10117 Princess Palm Avenue, Suite 375, Tampa, FL 33610. (813) 664-6800. (www.chainstoreguide.com)

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25 DOLLAR STORES & EXTREME-VALUE RETAILERS

25.1 Market Assessment Several categories of retail target the value-focused consumer, including dollar stores, off-price outlets, and closeout chains. According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales in this segment (NACIS Code 45299) have been as follows: • 2004: $39.36 billion • 2005: $41.20 billion • 2006: $43.14 billion • 2007: $44.23 billion • 2008: $45.50 billion • 2009: $47.64 billion • 2010: $50.74 billion • 2011: $54.70 billion • 2012: $58.21 billion • 2013: $59.31 billion • 2014: $61.99 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 4.28 billion February: $ 4.61 billion March: $ 4.88 billion April: $ 5.00 billion May: $ 5.38 billion June: $ 5.09 billion July: $ 5.10 billion August: $ 5.06 billion September: $ 4.84 billion October: $ 5.27 billion November: $ 5.52 billion December: $ 6.90 billion

25.2 Marketshare Leaders The largest dollar store, off-price/closeout, and thrift store chains, ranked by annual U.S. sales, are as follows:

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TJX Cos. (www.tjx.com):

$20.9 billion

Brands: T.J.Maxx, Marshalls, HomeGoods, A.J. Wright, Bob’s Stores, HomeSense, Winners

• • • • • • • • •

Dollar General (www.dollargeneral.com): Family Dollar Stores (www.familydollar.com): Ross Dress for Less (www.rossstores.com): Dollar Tree (www.dollartree.com): Big Lots (www.biglots.com): Burlington Coat Factory (www.coat.com): Freds Super Dollar (www.fredsinc.com): 99 Cents Only (www.99only.com): Tuesday Morning, Inc. (www.tuesdaymorning.com):

$17.5 billion $10.4 billion $10.2 billion $ 7.7 billion $ 5.1 billion $ 4.4 billion $ 1.8 billion $ 1.5 billion $ 800 million

25.3 Market Characteristics and Trends The economic downturn was a boon for many value-focused retailers. The expanding marketshare of dollar stores continues, even as the economy recovers. Growth is being driven, in part, by aggressive expansion plans of companies in the sector. _________________________________________________________________

“Not many other retailers are opening new stores, they are focusing instead on taking advantage of [customers] already in their stores and maximizing conversion to purchase, as well as expanding their online presence. Dollar store traffic has been increasing over the past few years because [stores] have expanded their selection of products, making the channel even more useful and pleasing to price-savvy consumers.” Marshal Cohen, Chief Analyst The NPD Group, 9/23/14 _________________________________________________________________

Dollar stores tend to site stores and merchandise selections to best serve the needs of their core customers, the low- to middle or fixed income households often underserved by other retailers. Customers, however, come from a wide range of income brackets.

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A survey by Mintel (www.mintel.com) found that 68% of adults in households with an annual income of $150,000 or higher shop in dollar stores. Among these consumers, 60% say that dollar stores offer better prices than other retailers. Across all demographics, Mintel found consumers’ views of dollar stores as follows: • Conveniently located: 78% • Offer better prices than other retailers: 74% • Stores are pleasant to shop in: 59% • Products are just as good as other retailers: 54% _________________________________________________________________

“Dollar stores benefit from continued consumer caution regarding spending as well as an improved level of acceptance and satisfaction of the products offered and the shopping experience in these channels.” Ali Lipson, Analyst Mintel MMR, 7/14/14 _________________________________________________________________

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26 HOME CENTERS & HARDWARE

26.1 Market Assessment According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales in the home centers and hardware segment have been as follows: Building Materials & Supplies Stores

$261.20 billion $286.60 billion $299.38 billion $283.85 billion $284.53 billion $230.07 billion $228.94 billion $236.71 billion $247.24 billion $260.52 billion $272.91 billion

Hardware Stores

• • • • • • • • • • •

2004: 2005: 2006: 2007: 2008: 2009: 2010: 2011: 2012: 2013: 2014:

$18.30 billion $18.88 billion $19.98 billion $20.51 billion $20.24 billion $19.01 billion $19.20 billion $20.72 billion $21.63 billion $20.33 billion $21.88 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $17.67 billion February: $16.80 billion March: $20.66 billion April: $24.54 billion May: $27.18 billion June: $25.56 billion July: $25.52 billion August: $23.82 billion September: $23.70 billion October: $24.36 billion November: $21.94 billion December: $21.09 billion

New homeowners are the most “home-improvement happy.” According to the Joint Center for Housing Studies at Harvard University (www.jchs.harvard.edu), they typically account for 25% of home improvement spending, even though they represent only 13% of all homeowners.

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With home sales in decline, the home improvement market suffered during the economic downturn, and home center sales dropped 19% between 2007 and 2010. Spending at these stores increased beginning in 2011, but revenue in the sector had still not returned to pre-recession levels at year-end 2014.

26.2 Marketshare Leaders The largest home center chains, ranked by annual U.S. sales, are as follows: • The Home Depot (www.homedepot.com): $69.95 billion • Lowe’s (www.lowes.com): $52.21 billion • Menards (www.menards.com): $ 8.89 billion • 84 Lumber Co. (www.84lumber.com): $ 2.10 billion • Sutherland Lumber Co. (www.sutherlands.com): $ 1.00 billion Home Depot and Lowe’s operate 1,965 and 1,717 stores, respectively. Competition between the two chains is intense – about 75% of Lowe’s stores are within 10 miles of a Home Depot store. The following are the largest hardware cooperatives, based on annual U.S. sales: • True Value Company (www.truevalue.com): $16.33 billion • Ace Hardware Corporation (www.acehardware.com): $10.60 billion

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27 MILITARY EXCHANGES

27.1 Market Assessment Retail exchanges serving the U.S. Armed Forces are called Base Exchange (BX) on Air Force bases, Post Exchange (PX) on Army posts, Navy Exchange (NEX) on Navy installations, Marine Corps Exchange (MCX) on Marine Corps installations, and Coast Guard Exchange (CGX) on Coast Guard installations. The exchanges serve active and retired military service members and their families. There are over 4,000 Military Exchange System stores. Annual retail sales are $14.0 billion, distributed as follows: Stores

• • • • •

Army and Air Force Exchange Service (AAFES): Navy Exchange Service Command (NEXCOM): Marines Corps Exchange (MCX): Veterans Canteen Service (VCS): Coast Guard Exchange System (CGES):

3,700 540 150 175 60

Sales

$11.6 billion $2.80 billion $ 995 million $ 200 million $ 145 million

27.2 The Army and Air Force Exchange Service AAFES, the largest component of the Military Exchange System, ranks among the 25 largest retailers in the U.S. AAFES serves a customer base that consists of active duty military personnel, retirees, and National Guard and Reserve members. During its 120 years of operation, AAFES has evolved from a purveyor of discounted basic necessities to a multichannel retailer with over 3,000 stores, restaurants, and movie theaters, as well as catalogs and a growing Internet site. A recent survey put its prices just 2.5% higher than Walmart’s, and shoppers get the added benefit of forgoing sales taxes. For grocery shopping, military personnel, including retirees, turn to a network of 281 stores (including about 95 overseas) operated by the Defense Commissary Agency (DeCA, www.commissaries.com). With annual sales of about $5 billion, DeCA generates revenues roughly equivalent to a conventional supermarket chain. Federal law does not allow the agency to make a profit, however, and products are sold at only a 5% markup from cost. Two-thirds of AAFES’ profits go to the military’s Morale, Welfare and Recreation fund, which pays for the operations of pools, libraries, and other base amenities. The remaining one-third of profits are used to renovate existing sites and construct new facilities. Retail Business Market Research Handbook 2015-2016

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Exchanges operated by the Army and Air Force Exchange Service were rebranded in 2014 as Exchange X.

27.3 Navy Exchange Service Command There are 540 Navy Exchanges that offer name brand products at discounted prices as well as quality store brand merchandise offered at a significant savings to all authorized customers. In addition, there are over 1,200 service operations such as gas stations, food outlets, laundry/dry cleaning, barber/beauty salons, flower shops, tailor shops, optical and optometry services, and complete vending services. NEXCOM has a partnership to sell Macy’s private brands (Karen Scott, Charter Club, and Style & Co.), which are offered at prices lower than at Macy’s stores.

27.4 Market Resources The following are Military Exchange System websites: • Coast Guard Exchange: www.cg-exchange.com • Marine Corps Exchange: www.usmc-mccs.org/shopping/index.cfm • Navy Exchange Service: www.mynavyexchange.com • Exchange Service: www.shopmyexchange.com

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28 OFFICE PRODUCTS

28.1 Market Assessment The U.S. school supplies and office products market is estimated at between $250 billion and $350 billion, depending upon how the category is defined. Computers, office furniture, and paper products account for the bulk of the spending. Office supply superstores garner a marketshare of about 20%, with the remaining 80% distributed among specialty retailers, discount stores, wholesale clubs, supermarkets, drug stores, catalogs, and online retailers. According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at office supply stores (NAICS Code 45321) have been as follows: • 2004: $21.68 billion • 2005: $22.16 billion • 2006: $22.79 billion • 2007: $23.20 billion • 2008: $21.72 billion • 2009: $20.22 billion • 2010: $19.94 billion • 2011: $19.62 billion • 2012: $19.18 billion • 2013: $18.15 billion • 2014: $17.13 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 1.61 billion February: $ 1.39 billion March: $ 1.46 billion April: $ 1.36 billion May: $ 1.30 billion June: $ 1.18 billion July: $ 1.35 billion August: $ 1.83 billion September: $ 1.50 billion October: $ 1.34 billion November: $ 1.25 billion December: $ 1.50 billion

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Owners of small businesses and home offices account for an estimated 70% to 80% of sales at superstore chains. Private label brands represent just over 20% of sales at each of the three leading office superstore chains, according to Retailing Today.

28.2 Marketshare Leaders The following are the largest office products chains, ranked by annual U.S. sales: • Staples (www.staples.com): $8.88 billion • Office Depot (www.officedepot.com): $7.02 billion • OfficeMax (www.officemax.com): $4.65 billion Combined, online and catalog sales are as follows (source: Multichannel Merchant): • Staples: $9.8 billion • OfficeMax: $3.8 billion • Office Depot: $3.3 billion Note: Staples catalog and online sales include Corporate Express and Quill Corp. brands.

Office supply sales at Walmart and Costco are estimated at $5.0 billion and $1.6 billion, respectively. Office Depot acquired OfficeMax for $1.17 billion in 2013. In February 2015, Staples announced plans to acquire Office Depot for $6.3 billion, pending regulatory approval. _________________________________________________________________

“This is a transformational acquisition. We expect to recognize at least $1 billion of synergies as we aggressively reduce global expenses and optimize our retail footprint.” Ron Sargent, CEO Staples, 2/4/15 _________________________________________________________________

28.3 Market Resources Independent Office Products and Furniture Dealers Association, 3601 E. Joppa Road, Baltimore, MD 21234. (410) 931-8100. (www.iopfda.org)

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29 PET SUPPLIES

29.1 Market Assessment The American Pet Products Association (APPA, www.americanpetproducts.org) estimates that 82.5 million U.S. households (68% of all households) own pets. For comparison, in 1988, 56% of U.S. households owned a pet. Some 46% of all households today own more than one pet. Topping the list of most-owned pets, there are 145 million freshwater fish in 14.3 million U.S. homes. Cats, with 95.6 million felines owned by 45.3 million household, are the second-most-popular pets in the U.S. Owned by more households than any other pet, 83.3 million pet dogs are owned by 56.7 million households. According to the APPA, spending on pets has been as follows: • 2004: $34.4 billion • 2005: $36.3 billion • 2006: $38.5 billion • 2007: $41.2 billion • 2008: $43.2 billion • 2009: $45.5 billion • 2010: $48.4 billion • 2011: $50.8 billion • 2012: $53.3 billion • 2013: $55.7 billion • 2014: $58.5 billion

• • • • •

The distribution of spending on pets in 2014 is estimated as follows: Food: $22.6 billion Veterinarian care: $15.2 billion Supplies and over-the-counter medicines: $13.7 billion Pet services, boarding, and grooming: $ 4.7 billion Live animal purchases: $ 2.2 billion

The yearly cost of buying, feeding, and caring for pets tops what Americans spend on movies, video games, and recorded music combined. This is understandable considering 91% of pet owners say they consider their pet to be a member of the family. Pet owners spend a combined $2.6 billion on holiday gifts for their pets, according to the APPA. One quarter of pet-related expenditures occur between Thanksgiving and Christmas.

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According to Pet & Pet Supplies Stores Industry Profile, a January 2015 publication by First Research (www.firstresearch.com), there are approximately 8,800 pet stores in the U.S., with combined annual revenue of about $14 billion.

29.2 Marketshare Leaders The largest pet store chains, ranked by annual U.S. sales, are as follows: • PetSmart (www.petsmart.com): $6.11 billion • Petco Animal Supplies (www.petco.com): $3.02 billion

29.3 Market Resources American Pet Products Association, 255 Glenville Road, Greenwich, CT 06831. (203) 532-0000. (www.americanpetproducts.org) Pet & Pet Supplies Stores Industry Profile, First Research, January 2015. (www.firstresearch.com/Industry-Research/Pet-and-Pet-Supplies-Stores.html)

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30 PRIVATE LABEL

30.1 Market Assessment Across all major U.S. retail channels sales of private-label products reached an all-time high of $112 billion in 2014, according to the Private Label Manufacturers Association (PLMA, www.plma.com). Growth in private label has been outpacing store brands sales since 2009, with store brands sales averaging 4.9% compared to national brand growth of just 2.1% annually. The 2014 figure, as tracked by The Nielsen Company (www.nielsen.com), was compiled from supermarkets, drug chains, and mass merchandisers, including Walmart, as well as dollar stores, the warehouse club channel, and military exchanges. Private label revenue and marketshare is distributed by retail channel as follows (source: The Nielsen Company [www.nielsen.com]): • • •

Supermarkets: Drug stores: All retail channels

Revenue

Unit Share

Dollar Share

$ 59 billion $ 8 billion $112 billion

23.4% 17.3% 21.2%

19.4% 16.4% 17.5%

_________________________________________________________________

“Once the exclusive purview of value-conscious shoppers, store brands have achieved mainstream status among most consumers by narrowing the price and quality gaps that once demarcated national brands and private label. Retailers are responding by venturing into new territory such as health and beauty and even alcoholic beverages.” The Nielsen Co. _________________________________________________________________

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For several years department stores have been creating stronger private labels while also eliminating underperforming or over-distributed supplier brands to increase their consumer appeal and reduce pervasive sameness. In 2007, the percentage of sales at Macy’s in exclusive or limited-distribution brands, including its private label lines, was 35%. By 2014, store brands increased to 45% of sales. The percentage is even higher at Kohl’s and JCPenney, where private label brands represent 48% and 50% of sales, respectively.

30.2 Comparison With National Brands In a survey by Accenture (www.accenture.com), 39% of consumers said they increased their purchases of store brands or private label brands in recent years because of the economy. Another 28% said they had already been buying private label brands for many years. Even with the improved economy, consumer preference for store brands continues to grow. Accenture found that 50% of consumers find the quality of private label brands to be just as good as national brands; 36% feel they are “just another brand.” According to a survey by Ipsos (www.ipsos.com/marketing), consumers find store brands to be the same or better than national brands with respect to the following criteria (percent of responses): • Good value for the money: 89% • Products that meet my needs: 87% • Convenient products: 87% • Good for the family: 86% • Products my family requests: 83% • Products that taste good: 81% • Products that work well: 81% • Products that I trust: 80% • High quality products: 73% • Unique products: 69% • Innovative products: 69% • Appealing packaging: 65%

30.3 Market Resources Private Label Manufacturers Association, 630 3 rd Avenue, New York, NY 10017. (212) 972-3131. (www.plma.com)

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31 TOYS & VIDEO GAMES

31.1 Market Assessment: Toy And Game Retail Stores According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at hobby, toy and game stores (NAICS Code 45112) have been as follows: • 2004: $16.31 billion • 2005: $16.25 billion • 2006: $16.02 billion • 2007: $16.34 billion • 2008: $16.17 billion • 2009: $15.66 billion • 2010: $15.99 billion • 2011: $16.39 billion • 2012: $16.78 billion • 2013: $19.13 billion • 2014: $20.17 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 1.17 billion February: $ 1.25 billion March: $ 1.40 billion April: $ 1.38 billion May: $ 1.35 billion June: $ 1.25 billion July: $ 1.37 billion August: $ 1.37 billion September: $ 1.45 billion October: $ 1.57 billion November: $ 2.48 billion December: $ 4.08 billion

31.2 Market Assessment: Toys Based on The NPD Group’s Retail Tracking Service (www.npd.com), the Toy Industry Association (www.toyassociation.org) reported the U.S. toy retail market in

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2014 at $18.1 billion. The Retail Tracking Service represents approximately 80% of the U.S. toy retail market. When considering the total toy market, NPD estimates domestic toy sales for 2014 in the $22 billion range. Sales in 2014 based on the Retail Tracking Service were distributed by category as follows (change from previous year in parenthesis): • Outdoor and sports toys: $3.6 billion (3%) • Infant and preschool: $2.8 billion (-4%) • Dolls: $2.3 billion (4%) • Building sets: $1.8 billion (13%) • Games and puzzles: $1.4 billion (10%) • Vehicles: $1.2 billion (no change) • Action figures and accessories: $1.3 billion (10%) • Plush toys: $ 940 million (6%) • Arts & crafts: $ 940 million (3%) • Youth electronics: $ 640 million (10%) • All other toys: $1.1 billion (no change) _________________________________________________________________

“Children may be spending more and more time online these day, but the toy industry still experienced steady growth last year.” eMarketer, 2/16/15 _________________________________________________________________

• • • • • •

The distribution of toy purchases by retail channel is as follows: Mass merchant/discount store: 55% Toy stores: 17% Online: 7% Food or drug stores: 4% Department/major chains: 4% Other: 11%

31.3 Market Assessment: Video Games According to the Entertainment Software Association (ESA, www.theesa.com) and The NPD Group, total consumer spending on computer and video games was $21.5 billion in 2013, distributed as follows: • Content: $15.4 billion • Hardware: $ 4.3 billion • Accessories: $ 2.9 billion

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Content spending for computer and video games has been as follows: • • • •

2010: 2011: 2012: 2013:

Video Games

Other*

Total

$9.4 billion $8.7 billion $8.1 billion $6.1 billion

$7.7 billion $7.9 billion $7.1 billion $9.2 billion

$17.1 billion $16.7 billion $15.2 billion $15.4 billion

* Other delivery formats include computers, digital full games, digital add-on content, mobile apps, social network gaming, and subscriptions.

Bloomberg Businessweek estimates the U.S. market for used video games at $1.6 billion. According to the ESA, 59% of Americans play video games. Fifty-one percent (51%) of U.S. households own a dedicated game console. The average game player is 31 years old; 52% of gamers are male.

31.4 Marketshare Leaders Toys “R” Us (www.toysrus.com), with $7.5 in annual U.S. sales, is the largest toy retailer. Walmart commands 25% of the U.S. toy market, according to The Wall Street Journal. GameStop (www.gamestop.com), the largest video game retailer, reports $6.1 billion in revenue.

31.5 Market Resources Entertainment Software Association, 575 7 th Street NW, Suite 300, Washington, DC 20004. (202) 223-2400. (www.theesa.com) The NPD Group, 900 West Shore Road, Port Washington, NY 11050. (516) 625-0700. (www.npd.com) Toy Industry Association, 1115 Broadway, Suite 400, New York, NY 10010. (212) 675-1141. (www.toyassociation.org) Video Games In The 21 st Century - The 2014 Report, Entertainment Software Association. (www.theesa.com/wp-content/uploads/2014/11/VideoGames21stCentury_2014.pdf)

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32 USED MERCHANDISE STORES

32.1 Overview There are approximately 25,000 used merchandise stores across the country, according to the National Association of Resale & Thrift Shops (www.narts.org). According to America’s Research Group (www.americasresearchgroup.com), about 16% to 18% of U.S. consumers shop at thrift stores. For consignment/resale shops, the figure is about 12% to 15%. To put these figures in perspective, 11% of Americans shop in factory outlet malls, 20% in apparel stores, and 21% in major department stores.

32.2 Market Assessment According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at used merchandise stores (NAICS Code 4533) have been as follows: • 2004: $ 9.27 billion • 2005: $ 9.32 billion • 2006: $10.41 billion • 2007: $10.93 billion • 2008: $11.01 billion • 2009: $10.40 billion • 2010: $11.07 billion • 2011: $12.12 billion • 2012: $13.31 billion • 2013: $14.58 billion • 2014: $15.20 billion

• • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 1.06 billion February: $ 1.10 billion March: $ 1.27 billion April: $ 1.26 billion May: $ 1.29 billion June: $ 1.24 billion July: $ 1.33 billion

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• • • • •

August: September: October: November: December:

$ $ $ $ $

1.36 billion 1.31 billion 1.42 billion 1.26 billion 1.25 billion

32.3 Market Leaders Goodwill Industries (www.goodwill.org) generates $3.5 billion in retail sales from more than 2,500 resale stores. Winmark Corporation (www.winmarkcorporation.com), the largest for-profit corporation in the used merchandise store category, operates five resale chains: Plato’s Closet, Play It Again Sports, Music Go Round, Once Upon A Child, and Style Encore. Thrift chains experiencing strong growth include Crossroads Trading Co. (www.crossroadstrading.com) and Buffalo Exchange (www.buffaloexchange.com).

32.4 Market Resources National Association of Resale & Thrift Shops, P.O. Box 80707, St. Clair Shores, MI 48080. (586) 294-6700. (www.narts.org) Used Merchandise Stores Industry Profile, First Research, February 2015. (www.firstresearch.com/industry-research/used-merchandise-stores.html)

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PART IV: APPAREL, FOOTWEAR & ACCESSORIES

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33 MARKET ASSESSMENT: APPAREL

33.1 Apparel Specialty Store Spending According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at clothing and specialty apparel stores (NAICS Code 4481) have been as follows: • 2004: $137.29 billion • 2005: $145.58 billion • 2006: $154.55 billion • 2007: $161.62 billion • 2008: $157.94 billion • 2009: $151.81 billion • 2010: $158.88 billion • 2011: $169.04 billion • 2012: $178.02 billion • 2013: $181.62 billion • 2014: $185.54 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 11.20 billion February: $ 12.21 billion March: $ 15.02 billion April: $ 15.18 billion May: $ 15.82 billion June: $ 14.25 billion July: $ 14.89 billion August: $ 16.10 billion September: $ 14.11 billion October: $ 15.46 billion November: $ 18.07 billion December: $ 23.18 billion

There are four categories of specialty apparel stores: family clothing, women’s apparel, men’s apparel, and children’s wear. Sales have been as follows:

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Family Clothing (NAICS Code 44814) • 2004: $72.44 billion • 2005: $77.29 billion • 2006: $81.71 billion • 2007: $84.59 billion • 2008: $83.06 billion • 2009: $81.43 billion • 2010: $85.28 billion • 2011: $89.56 billion • 2012: $94.47 billion • 2013: $97.64 billion • 2014: $99.38 billion Women’s Apparel (NAICS Code 44812) • 2004: $34.95 billion • 2005: $37.08 billion • 2006: $38.81 billion • 2007: $40.29 billion • 2008: $38.32 billion • 2009: $35.89 billion • 2010: $37.44 billion • 2011: $39.66 billion • 2012: $41.36 billion • 2013: $40.64 billion • 2014: $42.84 billion Men’s Apparel (NAICS Code 44811) • 2004: $ 8.59 billion • 2005: $ 8.74 billion • 2006: $ 8.84 billion • 2007: $ 8.77 billion • 2008: $ 8.54 billion • 2009: $ 7.72 billion • 2010: $ 7.80 billion • 2011: $ 8.57 billion • 2012: $ 9.19 billion • 2013: $ 8.85 billion • 2014: $ 8.95 billion

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Children’s Wear (NAICS Code 44813) and Infant’s Wear, and Other Specialty Apparel Stores (NAICS Code 44819) • 2004: $21.30 billion • 2005: $22.47 billion • 2006: $25.18 billion • 2007: $27.96 billion • 2008: $28.05 billion • 2009: $26.77 billion • 2010: $28.36 billion • 2011: $31.24 billion • 2012: $33.00 billion • 2013: $34.50 billion • 2014: $34.37 billion

33.2 Total Apparel Spending According to The NPD Group (www.npd.com), apparel sales in the U.S. totaled roughly $201 billion in 2014. Distribution by category is as follows (change from prior year in parenthesis): • Women’s apparel: $116.4 billion (5%) • Men’s apparel: $ 60.8 billion (4%) • Children’s/infant’s apparel: $ 23.8 billion (no change) The NPD Group and Census Bureau statistics differ because each measures separate characteristics of apparel retail. The NPD assessment is for apparel sales across all retail channels, including specialty stores, department stores, and discount mass merchandisers, while the Census Bureau tabulates sales only for select retail channels. The Census Bureau figures do not include apparel sales at general merchandise stores. The NPD assessment includes direct reporting by many retail chains, but some estimating is required because Walmart and others do not make public a breakdown of sales by product category.

33.3 Growth Segments While the overall apparel market is growing at only 2% annually, several segments are exhibiting strong growth. Activewear sales are increasing at 9% annually, making this the hottest segment of the apparel sector, according to The NPD Group. Activewear sales account for 16% of the total apparel market, or $33.7 billion.

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_________________________________________________________________

“Active wear is booming ... because consumers are working out, going out, and even hanging out in activewear. Consumers are drawn to its comfort and versatility, and the fact that it still makes a fashion statement. Activewear, by its nature, evokes a sense of athleticism, which only adds to its appeal.” Marshal Cohen, Chief Analyst The NPD Group, 9/3/14 _________________________________________________________________

The plus-size women’s clothing market, estimated at $17.5 billion, is growing at a 5% annual rate, according to The NPD Group. Within the plus-size category, 55-to-64 year olds represent the largest and fastest-growing consumer, with annual sales of $4.2 billion and a 9% annual growth rate. Swimwear, a $4.4 billion market, is also outpacing the overall apparel sector. Sales of men’s and women’s swimwear increased 13% and 6%, respectively, in 2014, according to The NPD Group.

33.4 Online Spending According to eMarketer (www.emarketer.com), U.S. online apparel and accessories sales have been, and are projected, as follows: • 2011: $34.2 billion • 2012: $41.0 billion • 2013: $48.6 billion • 2014: $56.6 billion • 2015: $64.8 billion • 2016: $73.0 billion

33.5 Marketshare Leaders The largest apparel chains, ranked by annual U.S. revenue, are as follows: • TJX (www.tjx.com): $20.9 billion Brands: T.J.Maxx, Marshalls, HomeGoods, A.J. Wright, Bob’s Stores, HomeSense, Winners

•

Gap Inc. (www.gapinc.com):

$12.9 billion

Brands: Banana Republic, Gap, Old Navy

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• •

Ross Dress For Less (www.rossstores.com): Limited Brands (www.limitedbrands.com):

$10.2 billion $ 9.3 billion

Brands: Bath & Body Works, Henri Bendel, La Senza, The White Barn Candle Co., Victoria’s Secret

• •

Burlington Coat Factory (www.coat.com): Abercrombie & Fitch (www.abercrombie.com):

$ 4.4 billion $ 3.5 billion

Brands: Abercrombie, Abercrombie & Fitch, Hollister, Ruehl, Gilly Hicks

• • • • • •

American Eagle Outfitters (www.ae.com): Men’s Wearhouse (www.menswearhouse.com): Ann Taylor (www.anntaylor.com): Chico’s FAS (www.chicos.com): J.Crew (www.jcrew.com): Charming Shoppes (www.charmingshoppes.com):

• • •

Polo Ralph Lauren (www.ralphlauren.com): The Children’s Place (www.childrensplace.com): L.L. Bean (www.llbean.com):

$ $ $ $ $ $

3.1 billion 2.3 billion 2.2 billion 2.2 billion 2.2 billion 2.0 billion

Brands: Catherine’s, Fashion Bug, Lane Bryant

$ 1.9 billion $ 1.7 billion $ 1.5 billion

33.6 Market Resources Apparel Specialty Stores, Chain Store Guide, 10117 Princess Palm Avenue, Suite 375, Tampa, FL 33610. (800) 927-9292. (www.chainstoreguide.com) The NPD Group, Retail Tracking Service, 900 West Shore Road, Port Washington, NY 11050. (516) 625-0700. (www.npd.com)

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34 MARKET ASSESSMENT: FOOTWEAR

34.1 Market Assessment According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at shoe stores (NAICS Code 4482) have been as follows: • 2004: $23.68 billion • 2005: $25.26 billion • 2006: $26.68 billion • 2007: $26.81 billion • 2008: $26.69 billion • 2009: $25.07 billion • 2010: $26.37 billion • 2011: $28.04 billion • 2012: $29.49 billion • 2013: $29.94 billion • 2014: $30.95 billion

• • • • • • • • • • • •

These figures do not include footwear sales at general merchandise stores. Sales in 2014 were distributed by month as follows: January: $ 1.83 billion February: $ 2.40 billion March: $ 2.63 billion April: $ 2.59 billion May: $ 2.57 billion June: $ 2.29 billion July: $ 2.55 billion August: $ 3.33 billion September: $ 2.27 billion October: $ 2.35 billion November: $ 2.63 billion December: $ 3.47 billion

34.2 Fashion Footwear According to The NPD Group (www.npd.com), consumers spent $41.5 billion on fashion footwear in 2013 (most recent data available), a 4% increase over the flat

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growth experienced in 2012. Fashion footwear includes all footwear except athletic footwear. Fashion footwear spending was distributed by category as follows (change from prior year in parenthesis): • Casual: $19.1 billion (7%) • Sport leisure: $ 7.5 billion (5%) • Dress: $ 7.5 billion (-4%) • Outdoor: $ 5.6 billion (10%) Fashion footwear spending was distributed by wearer segment as follows (change from prior year in parenthesis): • Women: $23.8 billion (2%) • Men: $12.5 billion (7%) • Children: $ 5.2 billion (2%)

34.3 Brand Focus Studies According to Women’s Footwear Brand Focus Study 2014, by The NPD Group, 60% of women say it is “how shoes look” that matters more than the brand, and that they are “willing to try new or lesser-known footwear brands.” Within the women’s footwear market, 60% of growth over the past two years came from Millennials, ages 16-to-34. Favorite footwear brands among millennial women are as follows: Casual/Dress Brands 1. Toms 2. Vans 3. Nine West 4. Steve Madden 5. American Eagle Athletic Brands 1. Nike 2. adidas 3. New Balance 4. Reebok 5. Skechers

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_________________________________________________________________

“What’s ‘in’ one year might be ‘out’ the next, which means it’s as important as ever for retailers and manufacturers to assess their brands’ reputation and perceptions in the marketplace, understand their target consumers’ attitudes and shopping behaviors, and adjust their plan of action accordingly. Female consumers overall are looking for newness, fresh products that will generate excitement, and their interest in versatility poses a potentially valuable and innovative opportunity for footwear brands to expand their presence by playing in both the athletic and casual markets.” Marshal Cohen, Chief Analyst The NPD Group, 8/5/14 _________________________________________________________________

According to Men’s Footwear Brand Focus Study 2014, by The NPD Group, necessity is the predominant motivation behind shoe purchasing for men, and their brand loyalty is strong and steady. Compared to women’s footwear, the men’s brand landscape has remained consistent over the past two years. Men’s footwear purchases increased 8% from 2012 to 2014, twice the growth rate of women’s footwear during the same period. The following are top men’s footwear brands for awareness and ownership: 1. Nike 2. New Balance 3. adidas 4. Reebok 5. Skechers

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_________________________________________________________________

“While two-thirds of men say they shop for replacement shoes only, much of the success that the men’s market has experienced over the past couple of years is due to the fact that men are becoming more interested in style and trends. This is apparent by the growth of items such as fashion boots, drivers, sneakers, and oxfords in various new materials and colors, which correlates with the growth of the men’s apparel and accessories markets. As men expand their wardrobes, they will need the right shoes to match. Altogether, this uptick in men’s fashion will likely translate to an increase in footwear purchase frequency.” Marshal Cohen, Chief Analyst The NPD Group, 8/5/14 _________________________________________________________________

34.4 Online Sales Online sales of fashion footwear were $7.9 billion in 2013, representing 19% of the segment spending and a 16% increase over the prior year, according to The NPD Group. The average online purchase of fashion footwear is higher than in-store purchases.

34.5 Athletic Footwear The National Sporting Goods Association (NSGA, www.nsga.org) estimates annual consumer purchases of athletic footwear at $18.0 billion. The NPD Group assesses the athletic footwear market lower, at $14 billion.

34.6 Sector Profile Shoe Stores Industry Profile, a January 2015 publication by First Research (www.firstresearch.com), provides the following profile of the segment:

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• •

• • •

•

The U.S. footwear sector includes about 28,000 stores with combined annual revenue of about $31 billion. Major companies include Payless ShoeSource, Brown Shoe Company (which owns Famous Footwear and Naturalizer), Foot Locker, and DSW. Shoe manufacturers, such as Nike, also have retail operations. The industry is concentrated: the top 50 companies generate about 75% of industry revenue. Shoe stores compete with department stores, mass merchandisers, apparel retailers, Internet retailers, and some shoe manufacturers. Major products sold by shoe stores include women’s casual and dress shoes (30% of industry revenue); men’s athletic shoes (20%); men’s casual and dress shoes (13%), and women’s athletic shoes (10%). Other products include handbag s, hosiery, and jewelry. Companies may specialize in men’s, women’s, children’s, or athletic shoes. Over half of all shoe retailers are family shoe stores. Shoe stores are comprised of national and regional chains, franchises, and independent retailers. Superstores can range between 10,000 sq. ft. and 25,000 sq. ft.; many chains are between 1,500 sq. ft. and 3,500 sq. ft. Typical locations include strip malls, stand-alone locations, and indoor shopping malls, particularly fashion malls.

34.7 Marketshare Leaders The largest shoe store chains, ranked by annual U.S. sales, are as follows: • Collective Brands (www.collectivebrandsinc.com): $ 3.0 billion Brands: Payless ShoeSource, Stride Rite

•

Brown Shoe (www.brownshoe.com):

$ 2.6 billion

34.8 Market Resources American Apparel & Footwear Association, 1601 North Kent Street, Suite 1200, Arlington, VA 22209. (703) 524-1864. (www.wewear.org) National Shoe Retailers Association, 7386 N. La Cholla Boulevard, Tucson, AZ 85741. (520) 209-1710. (www.nsra.org) National Sporting Goods Association, 1601 Feehanville Drive, Suite 300, Mt. Prospect, IL 60056. (847) 296-6742. (www.nsga.org) Shoe Stores Industry Profile, First Research, January 2015. (www.firstresearch.com/Industry-Research/Shoe-Stores.html) The NPD Group, Retail Tracking Service, 900 West Shore Road, Port Washington, NY 11050. (516) 625-0700. (www.npd.com)

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35 MARKET ASSESSMENT: JEWELRY

35.1 Jewelry Sales The total annual jewelry market in the United States, including sales at jewelry stores, general merchandise stores, specialty stores, and non-store retailers, is estimated at between $50 billion and $60 billion.

35.2 Jewelry Store Sales According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at jewelry stores (NAICS Code 44831) have been as follows: • 2004: $27.62 billion • 2005: $28.42 billion • 2006: $30.10 billion • 2007: $30.82 billion • 2008: $29.15 billion • 2009: $26.00 billion • 2010: $26.33 billion • 2011: $29.64 billion • 2012: $30.85 billion • 2013: $33.25 billion • 2014: $33.61 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 2.08 billion February: $ 2.87 billion March: $ 2.36 billion April: $ 2.50 billion May: $ 3.11 billion June: $ 2.38 billion July: $ 2.34 billion August: $ 2.45 billion September: $ 2.23 billion October: $ 2.37 billion November: $ 2.76 billion December: $ 6.11 billion

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35.3 Sector Profile Jewelry Retail Industry Profile, a January 2015 publication by First Research (www.firstresearch.com), provides the following profile of the segment: • The U.S. jewelry retail sector includes about 18,000 companies and 23,000 specialty stores with combined annual revenue of about $35 billion. • The industry is fragmented: the top 50 jewelry chains generate about 40% of revenue. • Jewelry is sold not only by specialized jewelry retailers, but also by department stores and mass merchants. Because regular gross margins are very high, often 50%, mass merchants have been able to cut prices and take market share. • Walmart is the largest jewelry retailer in the U.S. • Jewelry is often classified as bridal merchandise (engagement, bridal, and anniversary rings), fashion jewelry (rings, bracelets, earrings, pins, gold chains) and watches, silver flatware, and other giftware. Diamond jewelry and loose diamonds account for the largest share of total jewelry store sales (45%); watches for 13%, gold jewelry for 10%, and colored gemstone jewelry (rubies, sapphires, emeralds, etc.) for 8%. The Wall Street Journal reported that more than 1,500 jewelry stores – primarily small independent stores – went out of business during the recent recession.

35.4 Market Leaders Signet Jewelers (www.signetjewelers.com), with 1,379 stores and annual sales of $3.64 billion, is the largest jeweler in the United States. The company’s national brands are Kay Jewelers and Jared The Galleria Of Jewelry. Signet Jewelers also operates the following regional brands: JB Robinson Jewelers, Marks & Morgan Jewelers, Belden Jewelers, Osterman Jewelers, Shaw’s Jewelers, Weisfield’s Jewelers, LeRoy’s Jewelers, Rogers Jewelers, Goodman Jewelers, and Friedlander’s Jewelers. Other major companies include Zale, Tiffany & Co., and Sterling Jewelers.

35.5 Market Resources Jewelry Retail Industry Profile, First Research, January 2015. (www.firstresearch.com/industry-research/jewelry-stores.html) The Fashion Jewelry and Accessories Trade Association (FJATA), 25 Sea Grass Way, North Kingstown, RI 02852. (401) 667-0520. (www.fjata.org)

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36 MOST VALUABLE APPAREL & LUXURY BRANDS

36.1 Apparel Brand Valuations 2014 Millward Brown’s BrandZ (www.millwardbrown.com/BrandZ) has published a list of the world’s most valuable brands annually since 2006. The 2014 Brand Report lists the most valuable apparel brands* as follows (change in valuation from 2013 in parenthesis): • Nike: $24.58 billion (55%) • Zara: $23.14 billion (15%) • H&M: $15.56 billion (22%) * only brands active in the U.S. are listed

36.2 Luxury Brand Valuations 2014 The 2014 Brand Report lists the most valuable luxury brands* as follows (change in valuation from 2013 in parenthesis): • Louis Vuitton: $25.87 billion (14%) • Hermès: $21.84 billion (14%) • Gucci: $16.13 billion (27%) • Prada: $ 9.99 billion (6%) * only brands active in the U.S. are listed

36.3 Market Resources 2013 Brand Report, Millward Brown. (www.millwardbrown.com/BrandZ) Millward Brown, 11 Madison Avenue, 12th Floor, New York, NY 10010. (212) 548-7200. (www.millwardbrown.com)

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PART V: CONSUMER PACKAGED GOODS

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37 MARKET ASSESSMENT

37.1 Rank By Sales According to Mass Market Retailers (MMR), based on analysis by IRI (www.iriworldwide.com), sales of various product categories in supermarkets, drug stores, supercenters, and discount stores for the 12-month period ending October 6, 2014 were as follows (change from previous year in parenthesis): • Carbonated beverages: $19.42 billion • Milk: $15.65 billion • Salty Snacks: $15.49 billion • Cigarettes: $14.52 billion • Fresh bread & rolls: $13.50 billion • Beer/ale/alcoholic cider: $13.39 billion • Natural cheese: $11.68 billion • Chocolate candy: $10.13 billion • Cold cereal: $ 9.32 billion • Frozen dinners/entrees: $ 8.97 billion • Dog food: $ 8.92 billion • Wine: $ 8.85 billion • Bottled water: $ 8.50 billion • Toilet tissue: $ 8.39 billion • Coffee: $ 8.27 billion • Laundry detergent: $ 7.02 billion • Yogurt: $ 6.98 billion • Cookies: $ 6.97 billion • Crackers: $ 6.72 billion • Vitamins: $ 6.44 billion • Refrigerated juices/drinks: $ 6.08 billion • Soup: $ 5.80 billion • Ice cream/sherbet: $ 5.64 billion • Luncheon meat: $ 5.47 billion • Bottled juices - shelf stable: $ 5.47 billion • Non-chocolate candy: $ 5.29 billion • Refrigerated fresh eggs: $ 5.26 billion • Breakfast meat: $ 5.25 billion • Paper towels: $ 4.83 billion • Diapers: $ 4.74 billion

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Cat food: Snack bars/Granola bars: Soap: Frozen/refrigerated poultry: Spirits/liquor: Frozen pizza: Cold/allergy/sinus tablets: Frozen seafood: Baby formula/electrolytes: Refrigerated salad/coleslaw: Food bags & trash bags: Frozen novelties: Pet supplies: Snack nuts/seeds: Internal analgesics: Refrigerated meat: Shortening & oil: Skin care: Vegetables: Processed frozen/refrigerated poultry: Cups & plates: Household cleaners: Sports drinks: Spices/seasonings: Processed cheese: Weight control: Frozen breakfast food: Dinner sausage: Gastrointestinal tablets: Batteries: Creams/creamers: Toothpaste: Pastry/donuts: Dish detergent: Blades: Sanitary napkins/tampons: Shampoo: Canned/bottled fruit: Air fresheners: Frozen meat: Deodorant: Frankfurters: Frozen plain vegetables: Energy drinks:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

4.67 billion 4.63 billion 4.49 billion 4.46 billion 4.17 billion 4.35 billion 4.24 billion 4.21 billion 4.17 billion 4.08 billion 4.05 billion 3.91 billion 3.89 billion 3.88 billion 3.63 billion 3.47 billion 3.46 billion 3.44 billion 3.36 billion 3.27 billion 3.24 billion 3.20 billion 3.17 billion 3.16 billion 3.12 billion 3.09 billion 2.96 billion 2.96 billion 2.93 billion 2.85 billion 2.82 billion 2.81 billion 2.75 billion 2.68 billion 2.66 billion 2.65 billion 2.62 billion 2.59 billion 2.59 billion 2.53 billion 2.52 billion 2.51 billion 2.50 billion 2.49 billion

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Mexican food: Toothbrushes/dental accessories: Seafood - shelf stable: Dinners - shelf stable: Tea/coffee ready-to-drink: Spaghetti/Italian sauces: Pickles/relish/olives: Rice: Pasta: Dry packaged dinners: Salad dressings - shelf stable: Gum: Baby accessories: Butter/butter blends: Peanut butter: Sugar: Baking needs: Bakery snacks: Cosmetics - eye: Meat & refrigerated ham - shelf stable: Cleaning tools/mops/brooms: Dough/biscuit dough - refrigerated: Kitchen storage: Frozen appetizers/snack rolls: Refrigerated side dishes: Socks: Mayonnaise: Hair conditioner: Cosmetics - facial: Margarine/spreads: Baking mixes: Hand & body lotion: Hair coloring: Eye/contact lens care products: Cat/dog litter: First aid accessories: Cosmetics - nail: Moist towelettes: Facial tissue: Frozen potatoes/onions: Baby food: Mexican sauce: Motor oil: Aseptic juices:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

2.38 billion 2.35 billion 2.30 billion 2.25 billion 2.25 billion 2.19 billion 2.16 billion 2.15 billion 2.14 billion 2.12 billion 2.11 billion 2.10 billion 2.08 billion 2.03 billion 2.02 billion 2.02 billion 2.09 billion 1.97 billion 1.96 billion 1.96 billion 1.96 billion 1.95 billion 1.94 billion 1.93 billion 1.91 billion 1.90 billion 1.87 billion 1.86 billion 1.85 billion 1.83 billion 1.80 billion 1.76 billion 1.71 billion 1.68 billion 1.66 billion 1.65 billion 1.65 billion 1.63 billion 1.59 billion 1.57 billion 1.53 billion 1.53 billion 1.51 billion 1.48 billion

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Cream cheese/cream cheese spreads: Tomato products: Jellies/jams/honey: Adult incontinence: Pies & cakes: Lunches - refrigerated: Mouthwash: First aid treatment: Refrigerated entrees: Fabric softener liquid: Hot cereal: Tea - bags/loose: Hair accessories: Mustard/ketchup: Drink mixes: Candies: Sauces - other: Gravy/sauce mixes: Pest control: Suntan products: Lightbulbs: Foils & wraps: Cold/allergy/sinus liquids: Sour cream: Cottage cheese: Hair styling gel/mousse: Foot care products: Dried meat snacks: Snacks - miscellaneous: Frozen bread/frozen dough: Popcorn/popcorn oil: Laundry care:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

1.45 billion 1.43 billion 1.42 billion 1.40 billion 1.39 billion 1.36 billion 1.36 billion 1.33 billion 1.30 billion 1.28 billion 1.23 billion 1.22 billion 1.19 billion 1.19 billion 1.18 billion 1.17 billion 1.17 billion 1.16 billion 1.14 billion 1.12 billion 1.10 billion 1.09 billion 1.09 billion 1.09 billion 1.08 billion 1.06 billion 1.04 billion 1.04 billion 1.03 billion 1.02 billion 1.01 billion 1.01 billion

37.2 Market Resources Mass Market Retailers (MMR), Racher Press, Inc., 220 Fifth Avenue, New York, NY 10001. (212) 213-6000. (www.massmarketretailers.com) IRI, 150 North Clinton Street, Chicago, IL 60661. (312) 726-1221. (www.iriworldwide.com)

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38 LARGEST CPG COMPANIES

38.1 Largest Companies Ranked by annual revenue, the following are the largest suppliers of consumer packaged goods (sources: Forbes, Fortune, and company reports): • Procter & Gamble (www.pg.com): $85.1 billion • PepsiCo (www.pepsico.com): $65.5 billion • Kraft Foods (www.kraftfoodscompany.com): $54.4 billion • Coca-Cola (www.thecoca-colacompany.com): $48.0 billion • Mars (www.mars.com): $33.0 billion • Kimberly-Clark (www.kimberly-clark.com): $17.7 billion • Colgate-Palmolive (www.colgate.com): $16.7 billion • General Mills (www.generalmills.com): $16.7 billion • Kellogg (www.kelloggcompany.com): $14.2 billion • Land O’Lakes (www.landolakesinc.com): $14.1 billion • ConAgra Foods (www.conagrafoods.com): $13.3 billion • Dean Foods (www.deanfoods.com): $12.9 billion • Sara Lee (www.saralee.com): $12.1 billion • H.J. Heinz (www.heinz.com): $11.6 billion • Avon Products (www.avoncompany.com): $10.7 billion • Estée Lauder (www.elcompanies.com): $ 9.7 billion • Hormel Foods (www.hormelfoods.com): $ 8.2 billion • Campbell Soup (www.campbellsoupcompany.com): $ 7.7 billion • Dole Food (www.dole.com): $ 6.8 billion • Hershey (www.thehersheycompany.com): $ 6.6 billion • Dr. Pepper Snapple Group (www.drpeppersnapplegroup.com): $ 6.0 billion • Clorox (www.thecloroxcompany.com): $ 5.5 billion • J.M. Smucker (www.smucker.com): $ 5.5 billion • Energizer Holdings (www.energizer.com): $ 4.6 billion • McCormick (www.mccormick.com): $ 3.9 billion • Del Monte Foods (www.delmonte.com): $ 3.7 billion • E&J Gallo Winery (www.gallo.com): $ 3.4 billion • Spectrum Brands (www.spectrumbrands.com): $ 3.3 billion • Rich Products (www.rich.com): $ 3.0 billion • Flowers Foods (www.flowersfoods.com): $ 3.0 billion • Church & Dwight (www.churchdwight.com): $ 2.9 billion

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• • •

Tupperware Brands (www.tupperwarebrands.com): Sun Products Corporation (www.sunproductscorp.com): Michael Foods (www.michaelsfoods.com):

$ 2.6 billion $ 2.0 billion $ 1.8 billion

38.2 Top Growth CPG Companies A 2013 study by The Boston Consulting Group (www.bcg.com) and IRI (www.iriworldwide.com) identified the top-performing companies in the U.S. consumer-packaged-goods industry using a combination of three metrics: dollar sales growth, volume sales growth, and marketshare gains. Based on assessment of more than 400 CPG manufacturers, the top-ranked CPG companies are as follows: Large (more than $5 billion in retail sales) • Lorillard • Hershey • Anheuser-Busch InBev Mid-size ($1 billion to $5 billion in retail sales) • Green Mountain Coffee Roasters • Chobani • Starbucks Small ($100 million to $1 billion in retail sales) • TalkingRain • Idahoan • Handi-foil

38.3 Market Resources Boston Consulting Group, Exchange Place, 31st Floor, Boston, MA 02109. (617) 973-1200. (www.bcg.com)

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39 MOST VALUABLE CPG BRANDS

39.1 Brand Valuations 2014 Interbrand (www.interbrand.com) publishes a list of the world’s 100 most valuable brands annually. Valuations recognize brands for their current worth along with how much the brand is likely to earn in the future. Twenty consumer packaged goods (CPG) brands were among the leaders in the 2014 list, as follows: • Coca-Cola: $81.56 billion (3%) Products: carbonated beverages and bottled water

•

Gillette:

$22.85 billion (-9%)

Products: razors and shaving skin care

•

Pepsi:

$19.19 billion (7%)

Products: carbonated beverages and bottled water

•

Pampers:

$14.08 billion (8%)

Products: diapers

•

Kellogg’s:

$13.44 billion (4%)

Products: cereal

•

Budweiser:

$13.02 billion (3%)

Products: beer

•

Nescafé:

$11.41 billion (7%)

Products: coffee

•

L’Oréal:

$10.16 billion (3%)

Products: cosmetics

•

Colgate:

$ 8.22 billion (5%)

Products: home care, oral care, personal care, pet nutrition

•

Danone:

$ 8.21 billion (3%)

Products: fresh dairy products, waters, baby nutrition

•

Nestlé:

$ 8.00 billion (6%)

Products: chocolate and confectionery

•

Sprite:

$ 5.65 billion (-3%)

Products: carbonated beverages

•

Johnson & Johnson:

$ 5.19 billion (9%)

Products: personal health care

•

Jack Daniel’s:

$ 4.88 billion (5%)

Products: liquor

•

Johnnie Walker:

$ 4.84 billion (2%)

Products: liquor

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•

Kleenex:

$ 4.64 billion (5%)

Products: tissue and hand towels

•

Smirnoff:

$ 4.61 billion (8%)

Products: liquor

•

Corona Extra:

$ 4.39 billion (3%)

Products: beer

•

Heineken:

$ 4.22 billion (-3%)

Products: beer

39.2 Market Resources 2014 Ranking of the Top 100 Brands, (www.bestglobalbrands.com/2014/ranking) Interbrand, 130 Fifth Avenue, New York, NY 10011. (212) 798-7500. (www.interbrand.com)

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PART VI: DISCOUNT STORES, SUPERCENTERS & WAREHOUSE CLUBS

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40 MARKET ASSESSMENT

40.1 Market Assessment According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales for discount stores, supercenters, and warehouse clubs have been as follows: • 2004: $376.48 billion • 2005: $405.13 billion • 2006: $433.43 billion • 2007: $459.89 billion • 2008: $482.23 billion • 2009: $482.90 billion • 2010: $494.73 billion • 2011: $512.71 billion • 2012: $531.36 billion • 2013: $535.41 billion • 2014: $543.98 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 39.65 billion February: $ 39.82 billion March: $ 44.49 billion April: $ 43.17 billion May: $ 46.22 billion June: $ 44.32 billion July: $ 44.38 billion August: $ 47.18 billion September: $ 41.54 billion October: $ 44.76 billion November: $ 50.00 billion December: $ 58.29 billion

Supercenters have been one of America’s fastest-growing shopping concepts over the past decade. Supercenters now represent over 20% of all grocery store sales in the U.S. The discount segment remained strong during the economic downturn. Squeezed by increased food costs, tighter credit, and a slumping housing market, more

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consumers shopped at low-cost stores. The increased revenue of superstores and warehouse clubs has been, in large part, at the expense of retailers in other segments. The prosperity of discount stores, however, is more than a consequence of the recession. The Nielsen Company (www.nielsen.com) reports that supercenters and warehouse clubs, along with dollar stores, are the only trade classes to undergo a significant increase in household penetration in the current decade.

40.2 Marketshare Leaders The largest discount chain companies, ranked by annual U.S. sales, are as follows: • Walmart Stores (www.walmart.com): $334.30 billion Brands: Sam’s Club, Walmart

• • •

Costco Wholesale (www.costco.com): Target (www.target.com): Sears Holdings Corp. (www.sears.com):

$ 74.74 billion $ 71.27 billion $ 26.61 billion

Brands: Kmart, Sears

• •

Meijer (www.meijer.com): BJ’s Wholesale Club (www.bjs.com):

$ 16.62 billion $ 12.96 billion

40.3 Market Resources Discount Stores & Specialty Retailers, Chain Store Guide, 10117 Princess Palm Avenue, Suite 375, Tampa, FL 33610. (800) 927-9292. (www.chainstoreguide.com)

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41 MARKETSHARE BY METROPOLITAN AREA

41.1 Retail Sales In The Largest MSAs This chapter presents marketshare leaders for the 100 largest general merchandise metropolitan areas. The Metropolitan Statistical Areas (MSAs) defined by the U.S. Census Bureau (www.census.gov) are used. The assessment is based on research by Rascher Press (www.massmarketretailers.com) and originally published in the August 2014 issue of Mass Market Retailers. The general merchandise market leaders in the top 100 markets are as follows: 1. New York-Northern New Jersey-Long Island, NY-NJ-PA • Costco: 30%; Walmart: 23%; Target: 12%; BJ’s: 12%; Others: 23% 2. Los Angeles-Long Beach-Santa Ana, CA • Costco: 34%; Walmart: 25%; Target: 23%; Others: 18% 3. Chicago-Naperville-Joliet, IL-IN-WI • Walmart: 37%; Target: 23%; Costco: 17%; Others: 23% 4. Dallas-Fort Worth-Arlington, TX • Walmart: 60%; Target: 20%; Others: 20% 5. Houston-Baytown-Sugar Land, TX • Walmart: 63%; Target: 19%; Others: 18% 6. Atlanta-Sandy Springs-Marietta, GA • Walmart: 50%; Target: 17%; Costco: 16%; Others: 17% 7. Miami-Fort Lauderdale-Pompano Beach, FL • Walmart: 33%; Costco: 21%; Target: 16%; BJ’s: 12%; Others: 18% 8. Phoenix-Mesa-Scottsdale, AZ • Walmart: 42%; Costco: 23%; Target: 15%; Fry’s Marketplace: 13%; Others: 7% 9. Detroit-Warren-Livonia, MI • Meijer: 28%; Walmart: 25%; Costco: 16%; Target: 12%; Kmart: 8%; Others: 17%

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10. Washington-Arlington-Alexandria-DC-VA-MD-WV • Walmart: 27%; Costco: 28%; Target: 21%; Others: 24% 11. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD • Walmart: 36%; Target: 15%; BJ’s: 12%; Kmart: 9%; Others: 28% 12. Riverside-San Bernardino-Ontario, CA • Walmart: 36%; Costco: 28%; Target: 19%; Others: 17% 13. Seattle-Tacoma-Bellevue, WA • Fred Meyer: 34%; Costco: 33%; Walmart: 15%; Target: 12%; Others: 7% 14. San Francisco-Oakland-Fremont, CA • Costco: 44%; Target: 20%; Walmart: 16%; Others: 22% 15. Minneapolis-St. Paul-Bloomington, MN-WI • Target: 41%; Walmart: 36%; Costco: 12%; Others: 11% 16. San Diego-Carlsbad-San Marcos, CA • Costco: 42%; Walmart: 26%; Target: 18%; Others: 16% 17. Boston-Cambridge-Quincy, MA-NH • Walmart: 35%; Costco: 18%; BJ’s: 14%; Target: 12%; Others: 21% 18. St. Louis, MO-IL • Walmart: 59%; Target: 15%; Others: 26% 19. Tampa-St. Petersburg-Clearwater, FL • Walmart: 54%; Target: 17%; Others: 29% 20. Denver-Aurora, CO • Walmart: 45%; Target: 23%; Costco: 22%; Others: 10% 21. Portland-Vancouver-Beaverton, OR-WA • Fred Meyer: 48%; Costco: 22%; Walmart: 12%; Target: 10%; Others: 8% 22. Orlando-Kissimmee, FL • Walmart: 50%; Target: 19%; Costco: 16%; Others: 15% 23. Baltimore-Towson, MD • Walmart: 42%; Costco: 16%; Target: 15%; BJ’s: 11%; Others: 16%

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24. Pittsburgh, PA • Walmart: 51%; Costco: 13%; Target: 12%; Kmart: 9%; Others: 15% 25. Kansas City, MO-KS • Walmart: 54%; Costco: 17%; Target: 16%; Others: 13% 26. Cincinnati-Middletown, OH-KY-IN • Walmart: 41%; Meijer: 20%; Target: 12%; Biggs: 9%; Others: 16% 27. Indianapolis-Carmel, IN • Walmart: 48%; Meijer: 18%; Target: 17%; Others: 17% 28. Las Vegas-Paradise, NV • Walmart: 47%; Costco: 18%; Target: 17%; Others: 18% 29. Sacramento-Arden-Arcade-Roseville, CA • Walmart: 35%; Costco: 28%; Target: 18%; Others: 19% 30. San Antonio, TX • Walmart: 59%; Target: 17%; Costco: 16%; Others: 8% 31. Virginia Beach-Norfolk-Newport News, VA-NC • Walmart: 48%; Costco: 14%; Target: 13%; Kmart: 9%; Others: 16% 32. Columbus, OH • Walmart: 41%; Meijer: 25%; Target: 13%; Others: 21% 33. Charlotte-Gastonia-Concord, NC-SC • Walmart: 50%; Target: 16%; Costco: 14%; Others: 20% 34. Nashville-Davidson-Murfreesboro-Franklin, TN • Walmart: 59%; Target: 12%; Costco: 11%; Kmart: 7%; Others: 11% 35. Cleveland-Elyria-Mentor, OH • Walmart: 42%; Target: 16%; Costco: 14%; Kmart: 11%; Others: 17% 36. San Jose-Sunnyvale-Santa Clara, CA • Costco: 43%; Target: 26%; Walmart: 16%; Others: 15% 37. Jacksonville, FL • Walmart: 52%; Target: 18%; Others: 30%

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38. Oklahoma City, OK • Walmart: 74%; Target: 14%; Others: 12% 39. Austin-Round Rock, TX • Walmart: 61%; Target: 19%; Costco: 13%; Others: 7% 40. Birmingham, AL • Walmart: 83%; Others: 17% 41. Louisville-Jefferson County, KY-IN • Walmart: 47%; Meijer: 18%; Target: 13%; Others: 22% 42. Salt Lake City, UT • Walmart: 46%; Costco: 22%; Target: 12%; Others: 20% 43. Memphis, TN-MS-AR • Walmart: 58%; Costco: 13%; Target: 12%; Others: 17% 44. Milwaukee-Waukesha-West Allis, WI • Walmart: 54%; Target: 19%; Costco: 10%; Kmart: 8%; Others: 9% 45. New Orleans-Metairie-Kenner, LA • Walmart: 69%; Target: 11%; Others: 20% 46. Richmond, VA • Walmart: 50%; Costco: 16%; Target: 14%; Others: 20% 47. Providence-New Bedford-Fall River, RI-MA • Walmart: 45%; BJ’s: 16%; Target: 14%; Others: 25% 48. Honolulu, HI • Costco: 39%; Walmart: 32%; Others: 29% 49. Raleigh-Cary, NC • Walmart: 50%; Target: 18%; Others: 32% 50. Albuquerque, NM • Walmart: 60%; Costco: 20%; Target: 12%; Others: 8% 51. Tulsa, OK • Walmart: 70%; Target: 12%; Others: 18%

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52. Grand Rapids-Wyoming, MI • Meijer: 46%; Walmart: 24%; Costco: 14%; Others: 16% 53. El Paso, TX • Walmart: 52%; Target: 13%; Costco: 12%; Kmart: 9%; Others: 14% 54. Tucson, AZ • Walmart: 38%; Costco: 24%; Target: 21%; Others: 17% 55. Dayton, OH • Walmart: 48%; Meijer: 22%; Target: 10%; Kmart: 8%; Others: 12% 56. Baton Rouge, LA • Walmart: 78%; Target: 11%; Others: 11% 57. Rochester, NY • Walmart: 52%; Target: 14%; BJ’s: 13%; Others: 21% 58. Omaha-Council Bluffs, NE-IA • Walmart: 49%; Target: 29%; Others: 22% 59. Little Rock-North Little Rock-Conway, AR • Walmart: 75%; Target: 10%; Others: 15% 60. Buffalo-Niagara Falls, NY • Walmart: 43%; Target: 18%; BJ’s: 12%; Others: 17% 61. Knoxville, TN • Walmart: 60%; Target: 13%; Costco: 10%; Kmart: 8%; Others: 9% 62. Boise City-Nampa, ID • Walmart: 36%; Fred Meyer: 32%; Costco: 15%; Others: 17% 63. Fresno, CA • Costco: 38%; Walmart: 30%; Target: 20%; Others: 12% 64. Hartford-West Hartford-East Hartford, CT • Walmart: 50%; Target: 14%; Costco: 13%; Others: 23% 65. New Haven-Milford, CT • Walmart: 37%; Costco: 26%; Target: 14%; BJ’s: 13%; Others: 10%

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66. Albany-Schenectady-Troy, NY • Walmart: 55%; Target: 16%; BJ’s: 12%; Kmart: 9%; Others: 8% 67. Anchorage, AK • Walmart: 38%; Costco: 26%; Fred Meyer: 21%; Others: 15% 68. Toledo, OH • Walmart: 35%; Meijer: 33%; Target: 11%; Others: 21% 69. McAllen-Edinburgh-Mission, TX • Walmart: 69%; Target: 13%; Others: 18% 70. Wichita, KS • Walmart: 70%; Target: 15%; Others: 15% 71. Columbia, SC • Walmart: 60%; Target: 11%; Kmart: 9%; Others: 20% 72. Charleston-North Charleston, SC • Walmart: 52%; Target: 14%; Costco: 13%; Others: 11% 73. Oxnard-Thousand Oaks-Ventura, CA • Costco: 28%; Target: 26%; Walmart: 22%; Kmart: 8%; Others: 16% 74. Greensboro-High Point, NC • Walmart: 60%; Target 11%; Costco: 10%; Others: 19% 75. Sarasota-Bradenton-Venice, FL • Walmart: 55%; Target: 18%; Others: 27% 76. Fort Myers-Cape Coral, FL • Walmart: 32%; Target: 26%; Costco: 20%; Others: 22% 77. Colorado Springs, CO • Walmart: 66%; Target: 19%; Others: 15% 78. Lansing-East Lansing, MI • Meijer: 43%; Walmart: 37%; Target: 12%; Others: 8% 79. Ogden-Clearfield, UT • Walmart: 42%; Costco: 24%; Target: 16%; Others: 18%

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80. Spokane, WA • Costco: 29%; Fred Meyer: 28%; Walmart: 25%; Target: 10%; Others: 8% 81. Des Moines, IA • Walmart: 50%; Target: 25%; Costco: 10%; Others: 15% 82. Bakersfield, CA • Walmart: 34%; Costco: 31%; Target: 14%; Kmart: 10%; Others: 11% 83. Allentown-Bethlehem-Easton, PA-NJ • Walmart: 54%; Target: 15%; Kmart: 13%; Others: 18% 84. Lexington-Fayette, KY • Walmart: 60%; Meijer: 15%; Others: 25% 85. Melbourne-Palm Bay-Titusville, FL • Walmart: 62%; Target: 15%; BJ’s: 11%; Others: 12% 86. Chattanooga, TN-GA • Walmart: 69%; Target: 11%; Others: 20% 87. Fayetteville-Springdale-Rogers, AR-MO • Walmart: 86%; Others: 14% 88. Lakeland, FL • Walmart: 72%; Target: 10%; Others: 17% 89. Springfield, MO • Walmart: 85%; Others: 15% 90. Greenville-Spartanburg, SC • Walmart: 59%; Costco: 10%; Others: 31% 91. Jackson, MS • Walmart: 76%; Target: 10%; Other: 14% 92. Reno-Sparks, NV • Walmart: 52%; Costco: 26%; Others: 22% 93. Bridgeport-Stamford-Norwalk, CT • Costco: 29%; Walmart: 25%; BJ’s: 15%; Others: 31%

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94. Stockton, CA • Walmart: 31%; Costco: 30%; Target: 20%; Others: 19% 95. Poughkeepsie-Newburgh-Middletown, NY • Walmart: 52%; Target: 15%; BJ’s: 12%; Others: 21% 96. Pensacola-Ferry Pass-Brent, FL • Walmart: 69%; Target: 11%; Kmart: 8%; Others: 12% 97. Huntsville, AL • Walmart: 59%; Costco: 14%; Target: 11%; Others: 16% 98. Provo-Orem, UT • Walmart: 46%; Costco: 32%; Others: 22% 99. Worcester, MA • Walmart: 43%; Target: 18%; BJ’s: 15%; Others: 24% 100. Scranton-Wilkes Barre, PA • Walmart: 58%; Kmart: 14%; Others: 22%

41.2 Market Resources Mass Market Retailers (MMR), Racher Press, Inc., 220 Fifth Avenue, New York, NY 10001. (212) 213-6000. (www.massmarketretailers.com)

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42 CUSTOMER PROFILE

42.1 Demographics of Mass Merchant Customers Prosper Business Development (www.goprosper.com) profiles shoppers at major mass merchant chains as follows: Kohl’s

Kmart

Target

Walmart

Gender • Male: • Female:

40.1% 59.9%

41.3% 58.7%

39.9% 60.1%

44.3% 55.7%

Marital Status • Married: • Unmarried, living with partner: • Divorced or separated: • Widowed: • Single, never married:

62.6% 6.7% 8.6% 4.2% 17.9%

46.1% 9.4% 15.7% 6.0% 22.7%

53.8% 8.3% 9.9% 2.9% 25.1%

52.1% 8.4% 12.4% 4.7% 22.3%

Age • 18-to-24: • 25-to-34: • 35-to-44: • 45-to-54: • 55-to-64: • 65 and older:

9.4% 16.2% 20.4% 21.1% 16.1% 16.8%

6.9% 13.2% 14.7% 24.2% 20.6% 20.4%

15.1% 23.0% 20.7% 17.0% 12.4% 11.8%

12.6% 16.9% 17.6% 20.3% 15.1% 17.4%

Household Income • Less than $15,000: • $15,000 to $24,999: • $25,000 to $34,999: • $35,000 to $49,999: • $50,000 to $74,999: • $75,000 to $99,999: • $100,000 to $149,999: • $150,000 or more:

4.8% 6.9% 9.5% 16.2% 27.6% 18.3% 13.2% 3.4%

14.7% 17.7% 16.1% 19.8% 19.8% 6.5% 5.0% 0.5%

8.0% 8.6% 11.5% 16.1% 23.7% 15.0% 12.7% 4.4%

12.1% 12.8% 14.4% 17.4% 22.3% 11.1% 7.8% 2.1%

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Region • Northeast: • Midwest: • South: • West:

18.4% 33.4% 28.3% 19.4%

21.2% 30.4% 29.0% 18.6%

16.9% 26.3% 31.7% 24.6%

16.3% 24.1% 40.4% 18.5%

42.2 Warehouse Club Members A July 2014 survey by Mintel (www.mintel.com) assessed the percentages of adults by annual household income that shop at Costco as follows: • Less than $25,000: 27% • $50,000 to $74,999: 36% • $100,000 to $149,999: 41% • $150,000 and more: 44% International Demographics (www.themediaaudit.com) reports that nearly one in four households earning above $75,000 or more in annual income and with children living at home shop at Costco. Those between the ages of 45 and 64 with an income of over $100,000 shop at Costco at a rate that is 45% hig her than the general population. Among Costco shoppers, nearly 30% are Hispanic and 14% are Asian. Compared with all U.S. adults, Hispanics are 59% more likely to shop at Costco and Asians are nearly twice as likely to shop at Costco. A 2014 survey by Millionaire Corner (www.millionairecorner.com) found that nearly one-half of respondents with a net worth of $5 million or more shop at Costco; about onethird shop at Walmart.

42.3 Market Resources International Demographics, 10333 Richmond Avenue, Suite 200, Houston, TX 77042. (713) 626-0333. (www.themediaaudit.com) Millionaire Corner, 840 S. Waukegan Road, Suite 211, Lake Forest, IL 60045. (224) 544-5353. (www.millionairecorner.com) Mintel, 333 West Wacker Drive, Suite 1100, Chicago, IL 60606. (312) 932-0400. (www.mintel.com) Prosper Business Development, 400 West Wilson Bridge, Suite 200, Worthington, OH 43085. (614) 846-0146. (www.goprosper.com)

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PART VII: DRUG STORES & PHARMACIES

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43 MARKET ASSESSMENT

43.1 Market Assessment According to the National Association of Chain Drug Stores (NACDS, www.nacds.org), there are 37,804 drug stores in the U.S., distributed as follows: • Chains: 20,884 • Independent: 16,920 In addition, 9,300 supermarkets and 7,382 mass merchants have pharmacy departments. According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at drug stores and pharmacies (NAICS Code 44611) have been as follows: • 2004: $169.23 billion • 2005: $179.17 billion • 2006: $191.02 billion • 2007: $202.28 billion • 2008: $211.04 billion • 2009: $217.63 billion • 2010: $222.80 billion • 2011: $232.00 billion • 2012: $230.85 billion • 2013: $233.92 billion • 2014: $247.69 billion These figures do not include pharmacy sales at supermarkets, mass merchants, and other general merchandise stores. Sales in 2014 were distributed by month as follows: • January: $ 20.45 billion • February: $ 18.96 billion • March: $ 20.29 billion • April: $ 20.42 billion • May: $ 20.85 billion • June: $ 20.19 billion • July: $ 20.67 billion • August: $ 20.40 billion • September: $ 20.48 billion

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• • •

October: November: December:

$ 21.45 billion $ 19.94 billion $ 23.54 billion

43.2 Market Resources Chain Drug Review, 220 Fifth Avenue, 18th Floor, New York, NY 10001. (212) 213-6000. (www.chaindrugreview.com) Drug Industry Market Share Report, Chain Store Guide, 10117 Princess Palm Avenue, Suite 375, Tampa, FL 33610. (800) 927-9292. (www.chainstoreguide.com) Drug Store and HBC Chains, Chain Store Guide, 10117 Princess Palm Avenue, Suite 375, Tampa, FL 33610. (800) 927-9292. (www.chainstoreguide.com) Drug Store News, 425 Park Avenue, New York, NY, 10022. (800) 766-6999. (www.drugstorenews.com) National Association of Chain Drug Stores, 1776 Wilson Boulevard, Suite 200, Arlington, VA 22209. (703) 549-3001. (www.nacds.org)

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44 LARGEST CHAIN RETAIL PHARMACIES

44.1 Marketshare Leaders Chain Drug Review publishes an annual list of the top chains by dollar volume. The 2014 list* of U.S. retail pharmacies is as follows: • • • • • • • • • • • • • • • • • • • • • •

Walgreens (www.walmart.com): CVS (www.cvs.com): Rite Aid (www.riteaid.com): Health Mart (www.healthmart.com): Medicine Shoppe International (www.medicineshoppe.com): Marc Glassman (www.marcs.com): Kinney Drugs (www.kinneydrugs.com): Kerr Drug (www.kerrdrug.com): Discount Drug Mart (www.discount-drugmart.com): Bartell Drugs (www.bartelldrugs.com): Care Pharmacies (www.carepharmacies.com): Thrifty White (www.thriftywhite.com.com): Navarro Discount Pharmacy (www.navarro.com): Hy-Vee (www.hy-vee.com): Aurora Pharmacy (www.aurorahealthcare.org/services/pharmacy/index.asp): Lewis Drugs (www.lewisdrug.com): Henry Ford Health System (www.henryford.com): Fairview Pharmacy Service (www.fairview.org/pharmacy): Fruth Pharmacies (www.fruthpharmacy.com): NeighborCare (www.neighborcare.com): Pharmaca (www.pharmaca.com): Hometown Pharmacy (www.hometownpharmacy.com):

Sales

Stores

$72.22 billion $63.65 billion $25.30 billion $ 6.70 billion

8,116 7,500 4,603 3,159

$ 1.90 billion $ 1.36 billion $ 802 million $ 694 million $ 566 million $ 398 million $ 379 million $ 343 million $ 336 million $ 232 million $ $ $

181 million 160 million 138 million

69 35 22

$ $ $ $

135 million 118 million 116 million 116 million

30 27 28 24

$

107 million

27

*Only U.S. retail chains with sales >$100 million are listed.

44.2 Market Resources Chain Drug Review, 220 Fifth Avenue, 18th Floor, New York, NY 10001. (212) 699-2355. (www.chaindrugreview.com) Retail Business Market Research Handbook 2015-2016

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570 66 205 76 72 58 79 90 33 22

45 MERCHANDISE SALES MIX

45.1 Sales Distribution For Chain Drug Stores According to Chain Drug Review, annual sales at tradition chain drug stores are $238.3 billion. The merchandise mix is as follows: • • • • • • • •

Prescriptions: O-T-C/health: Edible consumables: Personal care: Cosmetics/fragrances: Non-edible consumables: General merchandise: Office/school supplies:

Sales

Pct. of Total

$168.1 billion $ 28.8 billion $ 27.5 billion $ 15.2 billion $ 8.1 billion $ 6.8 billion $ 5.2 billion $ 1.8 billion

64.3% 11.0% 10.5% 5.8% 3.1% 2.6% 2.0% 0.7%

_________________________________________________________________

“Drug store chains have worked hard to generate business outside of Rx. After several years where prescription sales have accounted for an increasingly greater percentage of sales, the front end gained share for the second year in a row. Because front-end categories provide much higher margins than the pharmacy, the shift in sales has worked to chain drug retailers’ advantage.” Chain Drug Review _________________________________________________________________

45.2 Market Resources Chain Drug Review, 220 Fifth Avenue, 18th Floor, New York, NY 10001. (212) 213-6000. (www.chaindrugreview.com)

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46 MERCHANDISE & FOOD SALES IN DRUG STORES

46.1 Sales at Mass Market Retail Stores According to Mass Market Retailers (MMR), based on analysis by IRI Group (www.iriworldwide.com), sales of products in drug stores for the 12-month period ending October 6, 2014 were as follows (change from previous year in parenthesis): • Cigarettes: $4.10 billion • Vitamins: $2.26 billion • Cold/allergy/sinus tablets: $1.92 billion • Chocolate candy: $1.80 billion • Internal analgesics: $1.29 billion • Beer/ale/alcoholic cider: $1.22 billion • Skin care: $1.20 billion • Carbonated beverages: $1.08 billion • Gastrointestinal tablets: $1.07 billion • Non-chocolate candy: $ 915 million • First aid accessories: $ 862 million • Spirits/liquor: $ 724 million • Cosmetics - eye: $ 723 million • Cosmetics - facial: $ 694 million • Cosmetics - nail: $ 683 million • Bottled water: $ 619 million • Toothbrushes: $ 616 million • Eye/contact lens care products: $ 611 million • Wine: $ 605 million • Sanitary napkins/tampons: $ 596 million • Hair coloring: $ 591 million • First aid treatment: $ 590 million • Batteries: $ 572 million • Salty Snacks: $ 571 million • Soap: $ 553 million • Blades: $ 535 million • Toothpaste: $ 523 million • Shampoo: $ 492 million • Hand & body lotion: $ 486 million • Cold/allergy/sinus liquids: $ 464 million • Toilet tissue: $ 464 million

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Milk: Deodorant: Adult incontinence: Weight control: Snack nuts/seeds: Hair conditioner: Diapers: Foot care products: Laundry detergent: Energy drinks: Gum: Suntan products: Hair accessories: Hair styling gel/mousse: Mouthwash: Baby formula/electrolytes: Cookies: Tea/coffee ready-to-drink: Ice cream/sherbet: Paper towels: Coffee: Cold Cereal: Snack bars/granola bars: Bottled juices - shelf stable: Sports drinks: Moist towelettes: Dog food: Facial tissue: Air fresheners: Pet supplies: Household cleaners: Food bags & trash bags: Dish detergent: Candies: Crackers: Frozen novelties: Refrigerated juices/drinks: Dried meat snacks: Snacks - miscellaneous: Pest control: Soup: Cleaning tools/mops/brooms: Cat food: Socks:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

458 million 452 million 439 million 433 million 408 million 401 million 377 million 372 million 353 million 348 million 344 million 331 million 323 million 286 million 281 million 276 million 237 million 236 million 234 million 234 million 214 million 194 million 177 million 170 million 170 million 170 million 146 million 144 million 140 million 137 million 136 million 124 million 122 million 121 million 119 million 91 million 91 million 88 million 86 million 86 million 84 million 83 million 77 million 73 million

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• • • • • • •

Baby accessories: Frozen dinners/entrees: Lightbulbs: Cups & plates: Fresh bread & rolls: Frozen pizza: Pastry/doughnuts:

$ $ $ $ $ $ $

72 million 70 million 69 million 69 million 65 million 53 million 43 million

46.2 Market Resources Mass Market Retailers (MMR), Racher Press, Inc., 220 Fifth Avenue, New York, NY 10001. (212) 213-6000. (www.massmarketretailers.com) IRI, 150 North Clinton Street, Chicago, IL 60661. (312) 726-1221. (www.iriworldwide.com)

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47 SALES BY METROPOLITAN AREA

47.1 Top 100 Markets Chain Drug Review assessed drug store retail sales in U.S. metropolitan markets based on U.S. Census Bureau (www.census.gov) data. Ranked by annual drug store sales, the Top 100 metropolitan markets are as follows: 1. New York-Northern New Jersey-Long Island, NY-NJ-PA: $19.10 billion 2. Los Angeles-Long Beach-Santa Ana, CA: $ 8.46 billion 3. Chicago-Naperville-Joliet, IL-IN-WI: $ 7.01 billion 4. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD: $ 5.53 billion 5. Miami-Fort Lauderdale-Pompano Beach, FL: $ 5.40 billion 6. Boston-Cambridge-Quincy, MA-NH: $ 4.86 billion 7. Detroit-Warren-Livonia, MI: $ 3.50 billion 8. San Francisco-Oakland-Fremont, CA: $ 3.46 billion 9. Houston-Baytown-Sugar Land, TX: $ 3.39 billion 10. Dallas-Fort Worth-Arlington, TX: $ 3.19 billion 11. Washington-Arlington-Alexandria-DC-VA-MD-WV: $ 3.11 billion 12. Atlanta-Sandy Springs-Marietta, GA: $ 2.74 billion 13. Phoenix-Mesa-Scottsdale, AZ: $ 2.32 billion 14. Tampa-St. Petersburg-Clearwater, FL: $ 2.22 billion 15. Cleveland-Elyria-Mentor, OH: $ 2.15 billion 16. St. Louis, MO-IL: $ 2.11 billion 17. Minneapolis-St. Paul-Bloomington, MN-WI: $ 1.96 billion 18. Riverside-San Bernardino-Ontario, CA: $ 1.93 billion 19. Seattle-Tacoma-Bellevue, WA: $ 1.92 billion 20. Providence-New Bedford-Fall River, RI-MA: $ 1.91 billion 21. Baltimore-Towson, MD: $ 1.89 billion 22. Pittsburgh, PA: $ 1.79 billion 23. San Diego-Carlsbad-San Marcos, CA: $ 1.76 billion 24. Orlando-Kissimmee, FL: $ 1.53 billion 25. Hartford-West Hartford-East Hartford, CT: $ 1.48 billion 26. Milwaukee-Waukesha-West Allis, WI: $ 1.44 billion 27. Indianapolis-Carmel, IN: $ 1.37 billion 28. Kansas City, MO-KS: $ 1.28 billion 29. Cincinnati-Middletown, OH-KY-IN: $ 1.27 billion 30. Charlotte-Gastonia-Concord, NC-SC: $ 1.22 billion

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31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74.

Nashville-Davidson-Murfreesboro-Franklin, TN: New Haven-Milford, CT: Sacramento-Arden-Arcade-Roseville, CA: Las Vegas-Paradise, NV: San Jose-Sunnyvale-Santa Clara, CA: New Orleans-Metairie-Kenner, LA: Bridgeport-Stamford-Norwalk, CT: Memphis, TN-MS-AR: San Antonio, TX: Columbus, OH: Buffalo-Niagara Falls, NY: Birmingham-Hoover, AL: Virginia Beach-Norfolk-Newport News, VA-NC: Jacksonville, FL: Richmond, VA: Louisville-Jefferson County, KY-IN: Portland-Vancouver-Beaverton, OR-WA: Austin-Round Rock, TX: Denver-Aurora, CO: Honolulu, HI: Oklahoma City, OK: Worcester, MA: Albany-Schenectady-Troy, NY: Raleigh-Cary, NC: Fresno, CA: Tulsa, OK: Akron, OH: Allentown-Bethlehem-Easton, PA-NJ: Knoxville, TN: Springfield, MA: Rochester, NY: Scranton-Wilkes-Barre, PA: Greensboro-High Point, NC: Baton Rouge, LA: Sarasota-Bradenton-Venice, FL: Syracuse, NY: Oxnard-Thousand Oaks-Ventura, CA: Omaha-Council Bluffs, NE-IA: Poughkeepsie-Newburgh-Middletown, NY: Youngstown-Warren-Boardman, OH-PA: Columbia, SC: Albuquerque, NM: Dayton, OH: Bakersfield, CA:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

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1.20 billion 1.12 billion 1.10 billion 1.09 billion 1.08 billion 1.07 billion 1.06 billion 1.05 billion 1.04 billion 1.02 billion 1.01 billion 976 million 934 million 931 million 903 million 894 million 861 million 847 million 834 million 813 million 776 million 745 million 740 million 735 million 683 million 656 million 652 million 651 million 640 million 635 million 602 million 596 million 591 million 582 million 574 million 563 million 557 million 552 million 524 million 523 million 511 million 500 million 492 million 455 million

75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.

Madison, WI: Jackson, MS: Grand Rapids-Wyoming, MI: Fort Myers-Cape Coral, FL: Greenville-Spartanburg, SC: Little Rock-Conway, AR: Toledo, OH: Harrisburg-Carlisle, PA: Chattanooga, TN-GA: Canton-Massillon, OH: Charleston, SC: El Paso, TX: Melbourne-Palm Bay-Titusville, FL: Stockton, CA: Corpus Christi, TX: Trenton-Ewing, NJ: McAllen-Edinburg-Mission, TX: Des Moines, West Des Moines, IA: Lakeland, FL: Port St. Lucie, FL: Daytona Beach-Ormond Beach, FL: Modesto, CA: Wichita, KS: Mobile, AL: Manchester-Nashua, NH: Winston-Salem, NC:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

47.2 Market Resources Chain Drug Review, 220 Fifth Avenue, 18th Floor, New York, NY 10001. (212) 213-6000. (www.chaindrugreview.com)

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451 million 450 million 440 million 437 million 436 million 431 million 429 million 428 million 425 million 408 million 402 million 399 million 397 million 391 million 386 million 379 million 362 million 357 million 353 million 350 million 347 million 345 million 344 million 341 million 340 million 326 million

48 MARKETSHARE BY METROPOLITAN AREA

48.1 Retail Sales In The Largest MSAs This chapter presents marketshare leaders for the 100 largest drug store metropolitan areas. The Metropolitan Statistical Areas (MSAs) defined by the U.S. Census Bureau (www.census.gov) are used. The assessment is based on research by Rascher Press (www.massmarketretailers.com) and originally published in the August 2014 issue of Mass Market Retailers. The drug store market leaders in the top 100 markets are as follows: 1. New York-Northern New Jersey-Long Island, NY-NJ-PA • CVS: 36%; Walgreens/Duane Reade: 28%; Rite Aid: 20%; Others: 16% 2. Los Angeles-Long Beach-Santa Ana, CA • CVS: 42%; Walgreens: 19%; Rite Aid: 17%; Others: 22% 3. Chicago-Naperville-Joliet, IL-IN-WI • Walgreens: 50%; CVS: 21%; Jewel/Osco: 13%; Others: 16% 4. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD • CVS: 34%; Rite Aid: 25%; Walgreens: 16%; Others: 25% 5. Miami-Fort Lauderdale-Pompano Beach, FL • Walgreens: 41%; CVS: 30%; Others: 29% 6. Boston-Cambridge-Quincy, MA-NH • CVS: 50%; Walgreens: 24%; Rite Aid: 12%; Others: 14% 7. Detroit-Warren-Livonia, MI • CVS: 35%; Walgreens: 24%; Rite Aid: 12%; Others: 29% 8. San Francisco-Oakland-Fremont, CA • Walgreens: 39%; CVS: 30%; Others: 31% 9. Houston-Baytown-Sugar Land, TX • Walgreens: 41%; CVS: 30%; Walmart: 12%; Others: 17%

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10. Dallas-Fort Worth-Arlington, TX • CVS: 32%; Walgreens: 29%; Walmart: 15%; Others: 24% 11. Washington-Arlington-Alexandria-DC-VA-MD-WV • CVS: 50%; Rite Aid: 10%; Others: 40% 12. Atlanta-Sandy Springs-Marietta, GA • CVS: 30%; Walgreens: 25%; Walmart: 12%; Kroger: 10%; Others: 23% 13. Phoenix-Mesa-Scottsdale, AZ • Walgreens: 42%; CVS: 20%; Walmart: 11%; Others: 27% 14. Tampa-St. Petersburg-Clearwater, FL • Walgreens: 41%; CVS: 28%; Walmart: 12%; Others: 19% 15. Cleveland-Elyria-Mentor, OH • CVS: 25%; Walgreens: 23%; Discount Drug Mart: 14%; Marc’s: 11%; Others: 27% 16. St. Louis, MO-IL • Walgreens: 53%; Walmart: 14%; CVS: 11%; Others: 22% 17. Minneapolis-St. Paul-Bloomington, MN-WI • Walgreens: 43%; CVS: 14%; Walmart: 10%; Others: 33% 18. Riverside-San Bernardino-Ontario, CA • Walgreens: 27%; CVS: 25%; Rite Aid: 19%; Others: 29% 19. Seattle-Tacoma-Bellevue, WA • Walgreens: 24%; Rite Aid: 18%; Bartell: 17%; Safeway: 10%; Others: 31% 20. Providence-New Bedford-Fall River, RI-MA • CVS: 50%; Walgreens: 18%; Rite Aid: 17%; Others: 15% 21. Baltimore-Towson, MD • CVS: 26%; Rite Aid: 25%; Walgreens: 17%; Walmart: 9%; Others: 23% 22. Pittsburgh, PA • Rite Aid: 34%; CVS: 16%; Walgreens: 14%; Giant Eagle: 13%; Walmart: 10%; Others: 13% 23. San Diego-Carlsbad-San Marcos, CA • CVS: 41%; Rite Aid: 17%; Walgreens: 12%; Others: 30%

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24. Orlando-Kissimmee, FL • Walgreens: 44%; CVS: 25%; Walmart: 13%; Publix: 11%; Others: 7% 25. Hartford-West Hartford-East Hartford, CT • CVS: 53%; Walgreens: 21%; Others: 26% 26. Milwaukee-Waukesha-West Allis, WI • Walgreens: 55%; Walmart: 12%; CVS: 10%; Others: 23% 27. Indianapolis-Carmel, IN • CVS: 46%; Walgreens: 26%; Walmart: 11%; Others: 17% 28. Kansas City, MO-KS • CVS: 37%; Walgreens: 29%; Walmart: 15%; Others: 19% 29. Cincinnati-Middletown, OH-KY-IN • Walgreens: 40%; CVS: 23%; Kroger: 15%; Walmart: 11%; Others: 11% 30. Charlotte-Gastonia-Concord, NC-SC • CVS: 36%; Walgreens: 22%; Rite Aid: 13%; Walmart: 12%; Others: 17% 31. Nashville-Davidson-Murfreesboro-Franklin, TN • Walgreens: 38%; CVS: 16%; Walmart: 13%; Others: 33% 32. New Haven-Milford, CT • CVS: 42%; Walgreens: 21%; Rite Aid: 19%; Others: 18% 33. Sacramento-Arden-Arcade-Roseville, CA • CVS: 24%; Walgreens: 23%; Rite Aid: 21%; Walmart: 11%; Others: 21% 34. Las Vegas-Paradise, NV • Walgreens: 37%; CVS: 28%; Walmart: 12%; Others: 23% 35. San Jose-Sunnyvale-Santa Clara, CA • CVS: 35%; Walgreens: 30%; Rite Aid: 10%; Others: 25% 36. New Orleans-Metairie-Kenner, LA • Walgreens: 52%; CVS: 25%; Walmart: 11%; Others: 12% 37. Bridgeport-Stamford-Norwalk, CT • CVS: 52%; Walgreens: 22%; Others: 26%

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38. Memphis, TN-MS-AR • Walgreens: 55%; Walmart: 13%; Kroger: 12%; Others: 20% 39. San Antonio, TX • Walgreens: 37%; CVS: 22%; H-E-B.: 21%; W almart: 12%; Others: 8% 40. Columbus, OH • CVS: 34%; Walgreens: 24%; Kroger: 14%; Others: 28% 41. Buffalo-Niagara Falls, NY • Rite Aid: 46%; Walgreens: 22%; CVS: 10%; Others: 22% 42. Birmingham-Hoover, AL • CVS: 32%; Walgreens: 24%; Walmart: 21%; Others: 23% 43. Virginia Beach-Norfolk-Newport News, VA-NC • Rite Aid: 31%; Walgreens: 29%; CVS: 12%; Walmart: 11%; Others: 17% 44. Jacksonville, FL • Walgreens: 39%; CVS: 26%; Walmart: 12%; Publix: 10%; Others: 13% 45. Richmond, VA • CVS: 35%; Walgreens: 21%; Rite Aid: 13%; Walmart: 10%; Others: 21% 46. Louisville-Jefferson County, KY-IN • Walgreens: 40%; CVS: 14%; Rite Aid: 13%; W almart: 12%; Kroger: 11%; Others: 10% 47. Portland-Vancouver-Beaverton, OR-WA • Walgreens: 32%; Rite Aid: 14%; Fred Meyer: 13%; Others: 41% 48. Austin-Round Rock, TX • Walgreens: 35%; CVS: 26%; H-E-B.: 19%; Others: 20% 49. Denver-Aurora, CO • Walgreens: 41%; Kings Soopers: 17%; Walmart: 13%; Others: 29% 50. Honolulu, HI • CVS/Longs: 74%; Others: 26% 51. Oklahoma City, OK • Walgreens: 38%; CVS: 26%; Walmart: 24%; Others: 12%

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52. Worcester, MA • CVS: 54%; Walgreens: 15%; Rite Aid: 11%; Others: 20% 53. Albany-Schenectady-Troy, NY • CVS: 40%; Rite Aid: 29%; Others: 31% 54. Raleigh-Cary, NC • Walgreens: 27%; CVS: 24%; Rite Aid: 15%; Others: 34% 55. Fresno, CA • Walgreens: 30%; CVS: 28%; Rite Aid: 15%; Others: 27% 56. Tulsa, OK • Walgreens: 48%; Walmart: 23%; CVS: 12%; Others: 17% 57. Akron, OH • CVS: 25%; Walgreens: 23%; Marc’s: 11%; Others: 41% 58. Allentown-Bethlehem-Easton, PA-NJ • CVS: 34%; Rite Aid: 22%; Walgreens: 11%; Others: 33% 59. Knoxville, TN • Walgreens: 36%; CVS: 24%; Walmart: 13%; Others: 27% 60. Springfield, MA • CVS: 47%; Walgreens: 20%; Rite Aid: 11%; Others: 22% 61. Rochester, NY • Rite Aid: 28%; CVS: 20%; Walgreens: 16%; Wegmans: 14%; Walmart: 11%; Others: 11% 62. Scranton-Wilkes-Barre, PA • CVS: 35%; Rite Aid: 26%; Others: 39% 63. Greensboro-High Point, NC • CVS: 38%; Walgreens: 29%; Walmart: 14%; Rite Aid: 10%; Others: 9% 64. Baton Rouge, LA • Walgreens: 31%; CVS: 24%; Walmart: 19%; Rite Aid: 10%; Others: 16% 65. Sarasota-Bradenton-Venice, FL • Walgreens: 39%; CVS: 28%; Walmart: 12%; Publix: 11%; Others: 10%

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66. Syracuse, NY • Rite Aid: 36%; Kinney Drug: 30%; Others: 34% 67. Oxnard-Thousand Oaks-Ventura, CA • CVS: 39%; Rite Aid: 22%; Walgreens: 15%; Vons: 11%; Others: 13% 68. Omaha-Council Bluffs, NE-IA • Walgreens: 47%; Walmart: 12%; Others: 41% 69. Poughkeepsie-Newburgh-Middletown, NY • CVS: 37%; Rite Aid: 25%; Walgreens: 10%; Others: 28% 70. Youngstown-Warren-Boardman, OH-PA • Walgreens: 29%; Rite Aid: 27%; Walmart: 12%; CVS; 11%; Giant Eagle: 10%; Others: 11% 71. Columbia, SC • CVS: 32%; Walgreens: 25%; Walmart: 13%; Rite Aid: 10%; Others: 20% 72. Albuquerque, NM • Walgreens: 50%; Walmart: 15%; Albertsons: 11%; Others: 24% 73. Dayton, OH • Walgreens: 27%; CVS: 26%; Walmart: 11%; Kroger: 10%; Others: 26% 74. Bakersfield, CA • Rite Aid: 33%; Walgreens: 23%; CVS: 14%; Walmart: 10%; Others: 20% 75. Madison, WI • Walgreens: 60%; Walmart: 11%; Others: 29% 76. Jackson, MS • Walgreens: 39%; CVS: 22%; Walmart: 15%; Others: 24% 77. Grand Rapids-Wyoming, MI • Walgreens: 40%; Rite Aid: 13%; Meijer: 12%; Others: 35% 78. Fort Myers-Cape Coral, FL • Walgreens: 41%; CVS: 29%; Publix: 14%; Others: 16% 79. Greenville-Spartanburg, SC • CVS: 38%; Walgreens: 24%; Walmart:11%; Others: 27%

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80. Little Rock-Conway, AR • Walgreens: 44%; Walmart: 28%; Kroger: 15%; Others: 13% 81. Toledo, OH • Rite Aid: 39%; Walgreens: 17%; Kroger: 14%; Walmart: 12%; Others: 18% 82. Harrisburg-Carlisle, PA • CVS: 33%; Rite Aid: 29%; Others: 38% 83. Chattanooga, TN-GA • CVS: 29%; Walgreens: 28%; Walmart: 16%; Others: 27% 84. Canton-Massillon, OH • Rite Aid: 24%; Walgreens: 16%; Marc’s: 16%; Discount Drug Mart: 12%; Others: 32% 85. Charleston, SC • CVS: 43%; Walgreens: 22%; Walmart: 10%; Others: 25% 86. El Paso, TX • Walgreens: 57%; Walmart: 19%; Albertson’s: 10%; Others: 14% 87. Melbourne-Palm Bay-Titusville, FL • Walgreens: 41%; CVS: 30%; Walmart: 13%; Others: 16% 88. Stockton, CA • Walgreens: 28%; CVS: 22%; Rite Aid: 14%; Others: 36% 89. Corpus Christi, TX • CVS: 30%; Walgreens: 28%; H-E-B: 22%; Walmart: 16%; Others: 4% 90. Trenton-Ewing, NJ • CVS: 47%; Rite Aid: 22%; Others: 31% 91. McAllen-Edinburg-Mission, TX • Walgreens: 38%; H-E-B: 22%; Walmart: 16%; Others: 24% 92. Des Moines, West Des Moines, IA • Walgreens: 45%; Walmart: 12%; Hy-Vee: 11%; Others: 32% 93. Lakeland, FL • Walgreens: 38%; CVS: 24%; Walmart: 15%; Publix: 14%; Others: 9%

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94. Port St. Lucie, FL • Walgreens: 42%; CVS: 27%; Publix: 13%; Others: 18% 95. Daytona Beach-Ormond Beach, FL • Walgreens: 50%; CVS: 20%; Walmart: 13%; Publix: 10%; Others: 7% 96. Modesto, CA • CVS: 29%; Walgreens: 27%; Rite Aid: 18%; Walmart: 11%; Others: 15% 97. Wichita, KS • Walgreens: 40%; Walmart: 26%; Dillon: 16%; Others: 18% 98. Mobile, AL • CVS: 28%; Walgreens: 29%; Rite Aid: 20%; Walmart: 10%; Others: 13% 99. Manchester-Nashua, NH • Rite Aid: 29%; CVS: 27%; Walgreens: 23%; Others: 31% 100. Winston-Salem, NC • CVS: 39%; Walgreens: 28%; Rite Aid: 15%; Walmart: 10%; Others: 8%

48.2 Market Resources Mass Market Retailers (MMR), Racher Press, Inc., 220 Fifth Avenue, New York, NY 10001. (212) 213-6000. (www.massmarketretailers.com)

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49 STORE COUNTS

49.1 Overview The three largest drug store chains operate a combined 20,219 stores in the United States. Store counts by chain are as follows: • Walgreens: 8,116 • CVS: 7,500 • Rite Aid: 4,603

49.2 State-by-State According to Chain Drug Review (April 2014), store counts by state for the three largest drug store chains are as follows: • • • • • • • • • • • • • • • • • • • • • • •

Alabama: Alaska: Arizona: Arkansas: California: Colorado: Connecticut: Delaware: District of Columbia: Florida: Georgia: Hawaii: Idaho: Illinois: Indiana: Iowa: Kansas: Kentucky: Louisiana: Maine: Maryland: Massachusetts: Michigan:

Walgreens

CVS

111 7 249 81 638 160 94 64 5 859 201 16 40 608 203 69 69 95 152 14 76 170 229

155 0 139 1 856 0 150 12 58 716 318 53 0 275 297 18 35 65 109 22 172 355 249

Rite A id

93 0 0 0 580 20 77 42 7 0 186 0 13 0 10 0 0 116 63 79 143 148 277

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• • • • • • • • • • • • • • • • • • • • • • • • • • • •

Minnesota: Mississippi: Missouri: Montana: Nebraska: Nevada: New Hampshire: New Jersey: New Mexico: New York: North Carolina: North Dakota: Ohio: Oklahoma: Oregon: Pennsylvania: Rhode Island: South Carolina: South Dakota: Tennessee: Texas: Utah: Vermont: Virginia: Washington: West Virginia: Wisconsin: Wyoming:

152 78 215 12 56 83 31 191 66 489 257 1 253 116 73 123 26 110 14 255 703 45 3 139 132 17 226 11

58 50 78 14 18 85 41 279 15 471 312 6 319 53 0 405 62 194 135 135 589 2 5 271 0 50 46 0

0 26 0 0 0 1 68 257 0 614 224 0 225 0 72 536 43 95 0 81 0 22 37 192 138 104 0 0

49.3 Market Resources Chain Drug Review, 220 Fifth Avenue, 18th Floor, New York, NY 10001. (212) 213-6000. (www.chaindrugreview.com)

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PART VIII: HEALTH, BEAUTY & COSMETICS

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50 MASS MARKET HBC PRODUCTS

50.1 Market Assessment According to Mass Market Retailers (MMR), based on analysis by IRI (www.iriworldwide.com), sales of over-the-counter/health, beauty and cosmetics (O-T-C/HBC) products in supermarkets, drug stores, and discount stores (excluding Walmart) for the 12-month period ending March 23, 2014 were as follows (change from previous year in parenthesis): • Vitamins: $6.45 billion (2.5%) • Soap: $4.51 billion (1.4%) • Cold/allergy/sinus tablets: $4.21 billion (1.9%) • Internal analgesics: $3.32 billion (1.3%) • Skin care: $3.44 billion (-0.5%) • Weight control/liquid nutrition/powders: $3.10 billion (4.7%) • Gastrointestinal tablets: $2.93 billion (0.1%) • Toothpaste: $2.84 billion (2.1%) • Shampoo: $2.66 billion (2.0%) • Sanitary napkins/tampons: $2.65 billion (-0.2%) • Blades: $2.59 billion (-2.3%) • Deodorant: $2.54 billion (3.2%) • Toothbrushes/dental accessories: $2.36 billion (1.3%) • Cosmetics - eye: $1.97 billion (1.6%) • Hair conditioner: $1.91 billion (4.9%) • Cosmetics - facial: $1.84 billion (1.6%) • Hand and body lotion: $1.79 billion (3.9%) • Hair coloring: $1.70 billion (0.2%) • Eye/contact lens care products: $1.67 billion (2.0%) • First aid accessories: $1.67 billion (2.0%) • Moist towelettes: $1.66 billion (3.8%) • Cosmetics - nail: $1.60 billion (-2.6%) • Adult incontinence products: $1.43 billion (5.4%) • Mouthwash: $1.39 billion (3.5%) • First aid treatments: $1.37 billion (5.8%) • Suntan products: $1.12 billion (-1.4%) • Cold/allergy/sinus liquids: $1.09 billion (2.8%) • Hairstyling gel/mousse: $1.07 billion (0.4%) • Foot care products: $1.05 billion (2.1%)

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• • • • • • • • • • • • • • • •

Misc. health remedies: Gastrointestinal liquids: Lip treatment: Anti-smoking products: Baby needs: Feminine needs: Shaving lotion/men’s fragrances: Fragrances - women’s: Hair appliances: Cosmetics - lip: Hair spray/spritz: Home health care/kits: Nasal products: Sexual health: Cosmetics - accessories: Cough drops:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

978 million (11.6%) 931 million (1.6%) 875 million (12.6%) 869 million (0.1%) 811 million (1.6%) 792 million (1.6%) 791 million (-3.1%) 783 million (-3.1%) 780 million (-4.6%) 741 million (0.3%) 697 million (-2.6%) 687 million (4.1%) 676 million (0.5%) 655 million (2.3%) 653 million (13.3%) 576 million (1.2%)

50.2 Market Resources Mass Market Retailers (MMR), Racher Press, Inc., 220 Fifth Avenue, New York, NY 10001. (212) 213-6000. (www.massmarketretailers.com) IRI, 150 North Clinton Street, Chicago, IL 60661. (312) 726-1221. (www.iriworldwide.com)

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51 BEAUTY PRODUCTS & COSMETICS

51.1 Cosmetics According to Beauty and Personal Care in the United States, a July 2014 report by Euromonitor (www.euromonitor.com), the U.S. cosmetics market has been, and is projected, as follows: • 2007: $51.5 billion • 2008: $52.4 billion • 2009: $52.4 billion • 2010: $53.0 billion • 2011: $53.7 billion • 2012: $54.9 billion • 2013: $56.6 billion • 2014: $58.8 billion • 2015: $60.6 billion • 2016: $62.5 billion

51.2 Prestige Beauty Products According to The NPD Group (www.npd.com), high-end skincare, fragrance, and makeup product sales at U.S. department and specialty stores (e.g., prestige beauty sales) were $11.2 billion in 2014. Sales by category were as follows: • Makeup: $4.4 billion • Skincare: $3.9 billion • Fragrance: $3.0 billion Overall, prestige beauty product spending increased 3% in 2014. Makeup had the highest gain, 6%, while fragrance and skincare spending increased 2% and 1%, respectively.

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_________________________________________________________________

“The beauty industry had a solid annual performance in a somewhat difficult retail environment, but there’s still plenty of room for improvement and development. We saw that fewer consumers, especially beauty shoppers, cut spending in 2014. At the same time, 2014 reported the fewest number shopping for beauty in six years.” Karen Grant, Analyst The NPD Group, 2/4/15 _________________________________________________________________

While mass merchandisers control the majority of the market for everyday body care and beauty products, department stores and specialty stores dominate the market for high-end cosmetics and beauty products. In recent years, drugstores and discounters have been trying to claim a bigger piece of the cosmetics business by selling more high-end products.

51.3 Cosmetics and Personal Grooming Products Online According to a June 2014 survey by Harris Interactive (www.harrisinteractive.com), 35% of adults have purchased cosmetics or personal grooming products online. For comparison, 69% of adults have purchased apparel online. Only 21% of adults surveyed by Harris said they prefer digital channels over retail stores for buying such products. _________________________________________________________________

“Consumers still choose bricks-and-mortar locations when they want to get pretty.” eMarketer, 9/15/14 _________________________________________________________________

A March 2014 survey by Nielsen (www.nielsen.com) also found low interest in purchasing cosmetics online. When asked about their purchasing intentions over the next six months, 22% of adults said they would be buying cosmetics online. For comparison, 43% said they would be purchasing apparel or accessories online.

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51.4 Market Resources Beauty Trends, The NPD Group, 900 West Shore Road, Port Washington, NY 11050. (516) 625-0700. (www.npd.com) Euromonitor International Inc., 224 S. Michigan Avenue, Suite 1500, Chicago, IL 60604. (312) 922-1115. (www.euromonitor.com)

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52 TOP RETAILERS

52.1 Top-Ranking O-T-C/HBC Retailers According to Mass Market Retailers (MMR), based on analysis by IRI (www.iriworldwide.com), the following are the top over-the-counter/health, beauty and cosmetics (O-T-C/HBC) retailers for the 12-month period ending March 23, 2014 (change from previous year in parenthesis): • Walmart: $18.68 billion (1.8%) • Walgreens: $ 9.54 billion (1.0%) • CVS: $ 9.22 billion (2.9%) • Target: $ 8.25 billion (1.4%) • Kroger: $ 3.50 billion (5.3%) • RiteAid: $ 3.34 billion (0.4%) • Dollar General: $ 1.45 billion (5.0%) • Family Dollar: $ 1.39 billion (4.8%) • Safeway: $ 1.21 billion (-0.9%) • Publix: $ 1.18 billion (3.5%) • Costco: $ 1.02 billion (9.8%) • Ahold USA: $ 998 million (-0.8%) • Sears/Kmart: $ 991 million (-8.7%) • Albertsons: $ 835 million (-2.8%) • Meijer: $ 808 million (2.4%) • H-E-B: $ 776 million (6.3%) • Wakefern: $ 596 million (3.0%) • Cardinal Health: $ 540 million (8.0%) • Delhaize: $ 522 million (no change) • Duane Reade: $ 492 million (-2.3%) • Supervalu: $ 436 million (1.6%) • AmerisourceBergen: $ 384 million (2.1%) • Dollar Tree: $ 341 million (n/a) • Wegmans: $ 323 million (7.5%) • BJ’s: $ 314 million (6.3%) • Bl-LO: $ 310 million (1.0%) • Giant Eagle: $ 308 million (-3.7%) • Winn-Dixie: $ 266 million (-1.2%) • Aldi: $ 256 million (n/a) • McKesson: $ 253 million (5.0%)

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

A&P: HarrisTeeter: Hy-Vee: drugstore.com: KinneyDrugs: Medicine Shoppe: Amazon.com: PriceChopper: StaterBros.: KerrDrug: Shopko: Raleys: Weis: SpartanNash: Fred’s: Discount Drug Mart: Demoulas: Ingles: Tops Markets: ThriftyWhite: Brookshire Grocery: Schnucks: Save Mart: Big Y: Bartell Drugs: Smart & Final: Brookshire Brothers: Harmon Face Values: Duckwalt-Alco: Save-Mor: Lewis Drugs: Fiesta Mart: Associated Food Stores: Coborn’s: K-VA-T: Navarro Discount Pharmacy: Bashas’ Supermarkets: Pharmaca: Marc Glassman: Fruth Pharmacy: Lowes: Houchens lndustries: Marsh Supermarkets: Fairview Pharmacy:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

223 million (-11.0%) 205 million (5.8%) 187 million (4.5%) 144 million (n/a) 130 million (n/a) 129 million (n/a) 125 million (n/a) 125 million (-3.0%) 115 million (0.5%) 111 million (3.9%) 111 million (-4.1%) 105 million (-3.0%) 102 million (2.6%) 92 million (n/a) 91 million (1.0%) 86 million (1.6%) 85 million (6.5%) 85 million (-2.0%) 81 million (2.2%) 77 million (3.6%) 75 million (1.0%) 66 million (0.7%) 50 million (-0.8%) 46 million (0.5%) 44 million (1.0%) 44 million (1.2%) 44 million (1.0%) 44 million (2.2%) 43 million (n/a) 43 million (3.9%) 42 million (3.0%) 41 million (n/a%) 39 million (2.0%) 38 million (2.0%) 36 million (2.0%) 34 million (2.1%) 34 million (n/a) 34 million (7.0%) 34 million (n/a) 31 million (n/a) 29 million (-3.5%) 27 million (1.6%) 26 million (n/a) 26 million (1.3%)

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• • • • • • • • • • • • •

Inserra Super: Village Supermarkets: Sedano: King Kullen: Bi-Mart: Roundy’s: Hartig Drug: Doc’s Drugs: Dierbergs: Hi-School Pharmacy: Nieman Foods: Family Pharmacy: King Food Markets:

$ $ $ $ $ $ $ $ $ $ $ $ $

26 million (1.3%) 25 million (n/a) 24 million (2.0%) 24 million (1.0%) 23 million (4.0%) 23 million (2.9%) 22 million (3.2%) 21 million (1.7%) 21 million (1.2%) 17 million (1.5%) 16 million (1.2%) 14 million (n/a) 12 million (1.5%)

52.2 Market Resources IRI, 150 North Clinton Street, Chicago, IL 60661. (312) 726-1221. (www.iriworldwide.com) Mass Market Retailers (MMR), Racher Press, Inc., 220 Fifth Avenue, New York, NY 10001. (212) 213-6000. (www.massmarketretailers.com)

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53 TOP BRANDS

53.1 Overview Mass Market Retailers (April 2014), based on analysis by IRI (www.iriworldwide.com), reported on top brands for 97 categories of health and beauty products. This chapter lists the three marketshare leaders for each category.

53.2 Market Leaders Acne Treatments 1. Neutrogena Oil Free Acne 2. Clearasil Ultra Rapid Action 3. Clearasil Daily Clear Adult Incontinence Products 1. Poise 2. Depend 3. Serenity Tena Antacid Tablets 1. Prilosec OTC 2. Zantac 150 3. Prevacid 24 Hour Anti-Itch Treatments 1. Corizone 10 2. Benadryl 3. Gold Bond Anti-Smoking Gum 1. Nicorette 2. Rexall Anti-Smoking Tablets 1. Nicorette

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Anti-Smoking Patches 1. Nicoderm CQ 2. Habitrol 3. Rugby Athlete’s Food Medications 1. Merck 2. Novartis Consumer Health 3. Blistex Baby Ointments/Creams 1. Destin Maximum Strength 2. A + D 3. Boudreaux’s Butt Paste Baby Soaps 1. Johnson’s Head-To-Toe 2. Aveeno Baby 3. Johnson’s Baby Wipes 1. Huggies Natural Care 2. Pampers Sensitive 3. Huggies Simply Clean Bath/Body Scrubbers/Massagers 1. Body Image Body Benefits 2. Spa Scrubs 3. Razz Blood Pressure Kits 1. Omron 2. HoMedics 3. HoMedics TheraP Cold Sore Medications 1. Abreva 2. Campho Phenique 3. Blistex Cold/Allergy/Sinus Liquids/Powders 1. Vicks NyQuil 2. Mucinex Fast Max 3. Children’s Mucinex

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Cotton Balls/Pads 1. Swisspers 2. Swisspers Supreme 3. Swiss Beauty Cotton Swabs 1. Q-Tips 2. Johnson’s 3. Swisspers Cough Syrup 1. Reckitt Beckiser 2. Pfizer 3. Proctor & Gamble Cough/Sore Throat Drops 1. Mondelez International 2. Ricola 3. Prestige Brands Holdings Dandruff Shampoos 1. Head & Shoulders Dry Scalp 2. Head & Shoulders Classic Clean 2 in 1 Shampoo and Conditioner 3. Head & Shoulders Classic Clean Dental Accessories/Tools 1. Waterpik 2. Sonicare E Series 3. Sonicare ProResults Dental Floss 1. Oral-B Glide Pro Health 2. Johns & Johnson Reach 3. Oral-B Glide Pro Health Deep Denture Adhesives 1. Fixodent Original 2. Fixodent 3. Fixodent Food Seal Denture Cleanser Tablets 1. Polident 2. Efferdent 3. Polident Overnight Whiteneing

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Deodorant Bar Soap 1. Irish Spring 2. Dial All Day Freshness 3. Zest Depilatories 1. Nair 2. Sally Hansen 3. Veet Diarrhea Tablets 1. Imodium 2. Imodium A-D 3. Rexall Disposable Razors 1. Gillette Custom Plus 2. Gillette Mach3 3. Gillette Sensor3 Electric Shavers/Groomers 1. Phillips Norelco 2. Remingon 3. Wahl Lithium Ion External Analgesic Rubs 1. Icy Hot 2. Salonpas 3. Bengay Eye Shadow 1. Maybelline Expert Wear 2. Cover Girl Eye Enhancers 3. Revlon ColorStay Eye/Lens Care Solutions 1. Alcon Opti-Free Replenish 2. Ciba Vision Clear Care 3. Alcon Opti-Free Pure Moist Eyeliners 1. Revlon ColorStay 2. Cover Girl Perfect Point Plus 3. Maybelline Unstoppable

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Facial Blush 1. L’Oréal True Match 2. Cover Girl Cheekers 3. Maybelline Fit Me Facial Anti-aging Products 1. Olay Regenerist 2. Olay Regenerist Micro 3. Olay Total Effects 7 in One Facial Cleaners 1. Olay 2. Cetaphil 3. Simple Facial Concealer 1. Maybeline Instant Age Rewind 2. L’Oréal True Match 3. Maybelline Cover Stick Facial Foundations 1. Revlon ColorStay 2. Covergirl Girl Clean 3. L’Oréal True Match Facial Moisturizers 1. Olay Complete 2. Neutrogena Moisture 3. Olay Active Hydrating Facial Powder 1. Cover Girl Clean 2. L’Oréal True Match 3. Cover Girl Professional Feminine Hygiene/Medical Treatments 1. Summer’s Eve 2. Vagisil 3. AZO Yeast First Aid Ointments/Antiseptics 1. Neosporin 2. Eucerin Aquaphor 3. Mederma

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First Aid Tape/Bandage/Gause/Cotton 1. Band Aid 2. Band Aid Tough Strips 3. 3M Nexcare Foot Care Devices 1. Merck 2. Implus Footcare 3. ProFoot Footcare Products Glucose Monitors 1. LifeScan One Touch Ultra 2. FreeStyle Lite 3. Bayer Contour Grooming/Shaving Scissors 1. Gillette Fusion Proglide Styler 2. Trim 3. Tweezerman Hair Appliances 1. Connair 2. Connair Infiniti Pro 3. Remington Hair Conditioner/Creme Rinses 1. Organix 2. Suave Professionals 3. Garnier Fructis Sleek & Shine Hair Spray/Spritz 1. TRESemmé Tres Two 2. Suave 3. Salon Grafix Hair Styling/Setting Gel/Mousse 1. American Crew 2. got 2b Glued 3. TRESemmé Tresmousse Hand and Body Lotions 1. Gold Bond Ultimate 2. Aveeno Active Naturals Daily 3. Vaseline Total Moisture

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Hand Sanitizers 1. Germ X 2. Purell 3. Purell Advanced Heat/Ice Packs 1. ThermaCare 2. Hothands 3. Hothands 2 Humidifiers/Vaporizers/Air Purifiers 1. Kaz Vicks 2. Honeywell 3. Holmes Internal Analgesic Liquids 1. Children’s Tylenol 2. Chidren’s Motrin 3. Children’s Advil Laxative/Stimulant Liquids/Powders/Oils 1. Miralax 2. Metamucil 3. Citrucel Laxative Tablets 1. Dulcolax 2. Colace 3. Metamucil Lip Balm/Treatments 1. Eos Evolution of Smooth 2. Burt’s Bees 3. Chapstick Classic Lip Gloss 1. Cover Girl Lip Perfection 2. L’Oréal Infallible 3. Rimmel Stay Glossy Lipstick 1. Revlon Super Lustrous 2. Cover Girl Outlast 3. L’Oréal Colour Riche

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Liquid Hand Soap 1. Softsoap 2. Dial 3. Dial Complete Makeup Removers Implements 1. Neutrogena 2. Almay 3. Garnier Nutritioniste Nutripure Manual Toothbrushes 1. Colgate Extra Clean 2. Colgate 360 3. Oral-B Crossaction Pro Health Mascara 1. Cover Girl Lash Bash 2. L’Oréal Voluminous 3. Maybelline Volum’ Express Falsied Flared Men’s Body Mists 1. Axe Dark Temptation 2. Axe Phoenix 3. Axe Excite Men’s Contraceptives 1. Church & Dwight 2. Ansell Americas 3. Reckitt Benckiser Men’s Hair Coloring 1. Just for Men 2. Just for Men Autostop 3. Just for Men Touch of Gray Men’s Traditional Fragrances 1. Curve for Men 2. Davidoff Cool Water 3. Drakkar Noir Moist Towelettes 1. Kleenex Cottonelle Fresh Care 2. Wet Ones 3. Charmin Freshmates

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Mouthwash/Dental Rinses 1. Listerine 2. Listerine Ultraclean 3. Listerine Total Care Multivitamins 1. Centrum Silver 2. Airborne 3. Bausch + Lomb PreserVision Muscle/Body Support Devices 1. Futuro 2. ACE 3. Mueller Sport Care Nasal Spray/Drops/Inhalers 1. Afrin No Drip 2. Afrin 3. Neilmed Sinus Rinse Non-Deodorant Bar Soap 1. Dove 2. Dove Go Fresh Cool Moisture 3. Dove Men Plus Care Oral Pain Relief 1. Orajel 2. Baby Orajel 3. Anbeson Personal Lubricants 1. Astroglide 2. K-Y Yours + Mine 3. K-Y Personal Thermometers 1. Braun Thermoscan 2. Comfort Scanner 3. Kaz Vicks Power Toothbrushes 1. Oral-B Pulsar 2. Arm & Hammer Spinbrush Pro 3. Phillips Sonicare Essence

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Pregnancy Test Kits 1. First Response 2. Clearblue 3. e.p.t. Razor Cartridges 1. Gillette Fusion 2. Gillette Mach3 3. Gillette Fusion Proglide Razors 1. Gillette Fusion Proglide 2. Gillette Venus Embrace 3. Schick Hydro 5 Sanitary Napkins/Liners 1. Always 2. Kotex Natural Balance 3. Stayfree Shaving Cream 1. Edge 2. Skintimate Skintherapy 3. Gillette Series Sleep Aid Tablets 1. Vicks NyQuil ZzzQuil 2. Unisom Sleepgels 3. Alteril Stomach Remedies Liquid/Powder 1. Pepto-Bismol 2. Phillips 3. Geri Care Suntan Lotions/Oils 1. Coppertone Sport 2. Neutrogena Ultra Sheer 3. Banana Boat Ultra Moist Sport Performance Tampons 1. Tampax Pearl 2. Playtex Sport 3. Kotex Natural Balance Security

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Toiletries and Grooming Products 1. Old Spice Red Zone 2. Edge 3. Old Spice Tooth Whiteners 1. Crest 3D White Whitestrips Advanced 2. Crest 3D White Whitestrips 3. Plus White Vaginal Treatments 1. Monistat 1 2. Monistat 3 3. Monistat 7 Vitamins, 1 & 2 Letter 1. Nature Made 2. Nature’s Bounty 3. Sundown Naturals Vitamins/Minerals - Liquid 1. Emergen-C 2. Emergen-C Immune Plus 3. Joint Juice Weight Control Candy/Tablets 1. Alli 2. Lipozene 3. Pure Health Naturally Women’s Contraceptives 1. Duramed Pharmaceuticals 2. Watson Pharmaceuticals 3. Gavis Pharmaceuticals Women’s Fragrances 1. Elizabeth Taylor’s White Diamonds 2. Body Fantasies Signature 3. Viva La Juicy Women’s Hair Coloring 1. L’Oréal Superior Performance 2. Garnier Nutrisse 3. L’Oréal Excellence

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53.3 Market Resources IRI, 150 North Clinton Street, Chicago, IL 60661. (312) 726-1221. (www.iriworldwide.com) Mass Market Retailers (MMR), Racher Press, Inc., 220 Fifth Avenue, New York, NY 10001. (212) 213-6000. (www.massmarketretailers.com)

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54 MOST VALUABLE HBC BRANDS

54.1 Brand Valuations 2014 Millward Brown’s BrandZ (www.millwardbrown.com/BrandZ) has published a list of the world’s most valuable brands annually since 2006. The 2014 Brand Report lists the most valuable health beauty & cosmetics (HBC) brands* as follows (change in valuation from 2013 in parenthesis): • L’Oreal: $23.36 billion (30%) • Gillette: $19.03 billion (7%) • Colgate: $17.67 billion (-6%) * only brands active in the U.S. are listed

54.2 Market Resources 2013 Brand Report, Millward Brown. (www.millwardbrown.com/BrandZ) Millward Brown, 11 Madison Avenue, 12th Floor, New York, NY 10010. (212) 548-7200. (www.millwardbrown.com)

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55 ONLINE RETAIL

55.1 Market Assessment According to eMarketer (www.emarketer.com), U.S. health and personal care retail e-commerce sales have been, and are projected, as follows (change from previous year in parenthesis): • 2013: $15.1 billion (15.9%) • 2014: $17.4 billion (15.1%) • 2015: $19.7 billion (13.6%) • 2016 $22.2 billion (12.4%) • 2017 $24.8 billion (11.6%) • 2018 $27.6 billion (11.2%) Online sales accounted for 5.6% of total health and personal sales in 2014, a figure that is not expected to change through 2018. _________________________________________________________________

“Beauty and cosmetics are difficult retail to sell outside of bricks-and-mortar stores. Because of their personal nature, shoppers find these items easier to visualize and understand in person, no matter how many pictures and tutorials they see. Though beauty and personal care items do sell better when accompanied by photos and videos online, shoppers still like to sample products in-store before purchasing. But once they decide which products they like, their preferences solidify, and shoppers refill online.” eMarketer, 1/20/15 _________________________________________________________________

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55.2 Online Shopping Characteristics A June 2014 survey by Harris Interactive (www.harrisinteractive.com) found that adults are buying cosmetics and beauty products online more than they were two to three years ago. When asked what specific beauty products they looked first to online mass merchandisers for, survey participants responded as follows: • Facial and skincare products: 17% • Non-sunscreen products with SPF protection: 13% • Hair color products: 13% • Hairstyling products: 12% Survey participants said they looked at specialty beauty vendors’ online storefronts for cosmetics when they wanted to find a certain brand or a more specialized categorization of products than they would find on sties such as Amazon.com or Target.com. When asked why they felt more comfortable buying cosmetics in-store rather than online, 62% said that computer screens could skew colors and they felt that they needed to see the items in person before purchasing. This is especially true for new products. Sixty-nine percent (69%) said that they were more likely to go to a physical store to purchase newly introduced health or cosmetic products. Eighty-eight percent (88%) of survey respondents said that when they know specifically what products they want to purchase, they will shop at any store – online or offline – that carries it for the best price.

55.3 Market Resources eMarketer, 11 Times Square, New York, NY 1036. (212) 763-6010. (www.emarketer.com) Harris Interactive, A Nielsen Company, 60 Corporate Woods, Rochester, NY 14623. (585) 272-8400. (www.harrisinteractive.com)

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PART IX: HOME FURNISHINGS & HOUSEWARES

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56 MARKET ASSESSMENT: RETAIL STORES

56.1 Spending At Furniture and Home Decor Stores According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at furniture, home furnishings and decor, floor covering, and other furnishings stores (NAICS Code 442) have been as follows: • 2004: $103.76 billion • 2005: $109.12 billion • 2006: $112.80 billion • 2007: $111.14 billion • 2008: $ 99.56 billion • 2009: $ 86.26 billion • 2010: $ 87.29 billion • 2011: $ 90.13 billion • 2012: $ 94.90 billion • 2013: $ 98.13 billion • 2014: $101.16 billion

• • • • • • • • • • • •

Sales in 2014 were distributed by month as follows: January: $ 7.35 billion February: $ 7.38 billion March: $ 8.26 billion April: $ 7.91 billion May: $ 8.52 billion June: $ 7.97 billion July: $ 8.50 billion August: $ 8.83 billion September: $ 8.42 billion October: $ 8.48 billion November: $ 9.04 billion December: $ 10.40 billion

56.2 Furniture Stores Sales at furniture stores (NAICS Code 4421) have been as follows (source: Census Bureau):

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• • • • • • • • • • •

2004: 2005: 2006: 2007: 2008: 2009: 2010: 2011: 2012: 2013: 2014:

$55.85 billion $58.74 billion $60.12 billion $59.29 billion $52.92 billion $48.18 billion $47.19 billion $48.36 billion $50.64 billion $50.96 billion $53.14 billion

56.3 Home Decor And Furnishings Stores Sales at home furnishings and decor stores (NAICS Code 4422) have been as follows (source: Census Bureau): • 2004: $47.91 billion • 2005: $50.38 billion • 2006: $52.67 billion • 2007: $51.86 billion • 2008: $46.64 billion • 2009: $40.07 billion • 2010: $40.10 billion • 2011: $41.77 billion • 2012: $44.26 billion • 2013: $47.17 billion • 2014: $48.02 billion

56.4 Floor Covering Stores Sales at floor coverings stores (NAICS Code 44221) have been as follows (source: Census Bureau): • 2004: $20.91 billion • 2005: $22.12 billion • 2006: $23.15 billion • 2007: $22.07 billion • 2008: $19.00 billion • 2009: $15.71 billion • 2010: $15.11 billion • 2011: $15.48 billion • 2012: $16.41 billion • 2013: $16.90 billion • 2014: $16.36 billion

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57 MARKET ASSESSMENT: RETAIL PRODUCTS

57.1 Total Product Spending According to 2014 State of the Industry, by Home Furnishings News (HFN), sales of home furnishings in 2013 were $170.3 billion, a 4.2% increase over 2012.

57.2 Sales For Product Categories Distribution of home furnishings sales in 2013 by category was as follows: • Furniture/lighting/decor: $82.9 billion - Case goods - Casual furniture - Lighting fixtures - Mattresses - Portable lighting - Upholstered furniture •

Housewares: - Air treatment - Bakeware (metal) - Blenders/food processors - Coffeemakers - Cookware (metal) - Cutlery - Floor care - Hair care - Irons - Kitchen tools and gadgets

$59.0 billion

•

Home textiles: - Bagged bed ensembles - Bath towels - Bed pillows - Mattress pads - Sheets

$19.4 billion

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•

Tabletop: - Crystal - Glassware - Housewares dinnerware - Stainless steel flatware - Upstairs dinnerware

$ 4.7 billion

•

Floor coverings/rugs: - Accent rugs - Handmade area rugs - Machine-made area rugs - Washable rugs

$ 4.2 billion

57.3 Retail Channels Home furnishings sales in 2013 were distributed by retail channel as follows (source: HFN): • Mass merchants and clubs: 28% • Furniture/specialty chains: 24% • Online: 17% • Specialty stores: 11% • Department stores: 5% • Home improvement stores: 2% • Catalog/direct sellers: 1% • Other: 12%

57.4 Market Resources 2014 State Of The Industry, HFN. (http://furnituretodaystore.stores.yahoo.net/hfnsoi.html) Home Furnishings News (HFN), 333 Seventh Avenue, New York, NY 10001. (212) 630-4000. (www.hfnmag.com)

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58 TOP RETAILERS

58.1 Market Leaders According to HFN, the following retailers have the highest home furnishings sales: • Walmart: $25.00 billion • Target Corp: $13.20 billion • Sears Holdings: $11.19 billion • Lowe’s: $10.05 billion • Home Depot: $ 9.26 billion • Bed Bath & Beyond: $ 7.21 billion • CCA Global Partners: $ 5.21 billion Brands: Carpet One, Flooring America, Lighting One

• • • • • • • • • • • • • • • • • • • • • • • • •

JCPenney: Costco Wholesale: TJX Cos.: Macy’s: Kroger: Williams-Sonoma: Sam’s Club: Kohl’s: Ikea: QVC: Ashley Furniture Industries: Berkshire Hathaway: Walgreens: Best Buy: Amazon.com: Rooms To Go: La-Z-Boy: Ross Stores: Office Depot: Big Lots: Abbey Carpet: Crate & Barrel: Staples: Pier 1 Imports: Family Dollar:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

3.88 billion 3.79 billion 3.66 billion 3.35 billion 3.16 billion 3.07 billion 2.98 billion 2.95 billion 2.30 billion 2.21 billion 2.12 billion 2.05 billion 1.75 billion 1.75 billion 1.72 billion 1.60 billion 1.45 billion 1.43 billion 1.42 billion 1.41 billion 1.36 billion 1.30 billion 1.27 billion 1.12 billion 1.00 billion

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58.2 Market Resources Home Furnishings News (HFN), 333 Seventh Avenue, New York, NY 10001. (212) 630-4000. (www.hfnmag.com) The Top Retailers in Home Furnishings 2014, HFN. (http://furnituretodaystore.stores.yahoo.net/toprtlrshf.html)

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59 LARGEST HOME FURNISHINGS COMPANIES

59.1 Top Suppliers Of Home Furnishings Products Home Furnishings News compiles an annual list of the largest suppliers of home furnishings products based on annual sales. The largest home furnishings companies are as follows: • Whirlpool: $9.52 billion Products: major appliances, housewares

•

AB Electrolux:

$4.23 billion

Products: major appliances, housewares

•

Newell Rubbermaid:

$1.75 billion

Products: housewares, window treatments

•

Mohawk:

$1.32 billion

Products: floor coverings

•

La-Z-Boy:

$1.19 billion

Products: furniture

•

Jarden:

$1.15 billion

Products: housewares, tabletop

•

Sealy:

$1.14 billion

Products: mattresses

•

Furniture Brands International:

$1.11 billion

Products: furniture

•

Leggett & Platt:

$1.05 billion

Products: furniture

•

Tempur-Pedic:

$1.00 billion

Products: mattresses

•

Hunter Douglas:

$ 975 million

Products: window treatments

•

Helen of Troy:

$ 843 million

Products: housewares

•

Select Comfort:

$ 743 million

Products: mattresses

•

Techtronic Industries:

$ 722 million

Products: housewares

•

NACCO Housewares Group:

$ 714 million

Products: Housewares

•

Ethan Allen:

$ 709 million

Products: furniture, textiles, decor floor coverings

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•

BSH:

$ 672 million

Products: major appliances, housewares Brands: Bosch, Siemens

•

Libbey:

$ 596 million

Products: tabletop

•

Lifetime Brands:

$ 444 million

Products: housewares, tabletop

•

Flexsteel:

$ 335 million

Products: furniture

59.2 Market Resources Home Furnishings News (HFN), 333 Seventh Avenue, New York, NY 10001. (212) 630-4000. (www.hfnmag.com)

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PART X: SPORTING GOODS

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60 MARKET ASSESSMENT

60.1 Spending At Sporting Goods Stores According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at sporting goods stores (NAICS Code 45111) have been as follows: • 2004: $28.64 billion • 2005: $30.71 billion • 2006: $33.87 billion • 2007: $35.80 billion • 2008: $37.05 billion • 2009: $37.14 billion • 2010: $38.28 billion • 2011: $40.31 billion • 2012: $43.95 billion • 2013: $44.15 billion • 2014: $43.22 billion These figures do not include sporting goods sales at general merchandise stores. Sales in 2014 were distributed by month as follows: • January: $ 2.62 billion • February: $ 2.68 billion • March: $ 3.39 billion • April: $ 3.35 billion • May: $ 3.49 billion • June: $ 3.74 billion • July: $ 3.66 billion • August: $ 4.18 billion • September: $ 3.34 billion • October: $ 3.27 billion • November: $ 3.77 billion • December: $ 5.70 billion

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60.2 Spending Distribution The National Sporting Goods Association (NSGA, www.nsga.org) estimates consumer equipment purchases by sport as follows: • Exercise: $5.47 billion • Hunting (firearms): $5.37 billion • Golf: $3.29 billion • Team goods sales: $2.62 billion • Fishing tackle: $2.09 billion • Camping: $1.75 billion • Optics: $1.30 billion • Snow skiing: $ 619 million • Baseball & softball: $ 452 million • Archery: $ 451 million • Tennis: $ 425 million • Billiards & indoor games: $ 350 million • Skin diving & scuba: $ 348 million • Wheel sports: $ 341 million • Snowboarding: $ 312 million • Basketball: $ 261 million • Helmets & sport protective: $ 211 million • Hockey & ice skates: $ 166 million • Bowling: $ 155 million • Football: $ 87 million • Soccer (balls): $ 77 million • Lacrosse: $ 43 million • Volleyball & badminton: $ 37 million • Racquetball: $ 27 million Sports equipment sales are distributed by retail channel as follows (source: NSGA): • Sporting goods stores: 31% • Discount stores/warehouse clubs: 15% • Specialty sport shops: 12% • Department stores: 12% • Online: 11% • Pro shops: 5% • Specialty fitness shops: 2% • Other: 11% Athletic footwear sales are distributed by retail channel as follows (source: NSGA): • Discount stores/warehouse clubs: 18% • Sporting goods stores: 16% • Specialty athletic footwear stores: 15% Retail Business Market Research Handbook 2015-2016

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• • • • • •

Department stores: Family footwear stores: Online: Factory outlet stores: Specialty sport shops: Other:

11% 11% 9% 8% 5% 7%

A June 2014 assessment by the Sports & Fitness Industry Association (SFIA, www.sfia.org) reported sports and fitness industry wholesale sales at $81.4 billion.

60.3 Marketshare Leaders The largest sporting goods chains, ranked by annual U.S. sales, are as follows: • Dick’s Sporting Goods (www.dickssportinggoods.com): $6.2 billion • Bass Pro Shops (www.basspro.com): $3.8 billion • The Sports Authority (www.thesportsauthority.com): $3.4 billion • Academy Sports & Outdoors (www.academy.com): $2.7 billion • Cabela’s, Inc. (www.cabelas.com): $2.4 billion • Gander Mountain (www.gandermountain.com): $1.1 billion • Big 5 Sporting Goods (www.big5sportinggoods.com): $ 900 million • Hibbett Sports (www.hibbett.com): $ 600 million • Sport Chalet (www.sportchalet.com): $ 400 million

60.4 Trends According to the SFIA, the biggest challenge facing the sporting goods industry, by far, is the decline in sports participation. W ith the exception of fitness activities, Americans are far less involved in sports and outdoors activities than they were 15 years ago. Sports such as softball, volleyball, baseball, badminton, and tennis have lost millions of casual participants. Fitness has seen an increase in the num ber of frequent participants in recent years, but still has fewer frequent participants as a percentage of the total population than it had in 1990. Organized team sports in schools and leagues have grown in recent years, largely because of a strong infusion of female players. But many organized team sports tend to emphasize elite players and competition, freezing out millions who might like to play for fun.

60.5 Market Resources National Sporting Goods Association (NSGA), 1601 Feehanville Drive, Suite 300, Mt. Prospect, IL 60056. (847) 296-6742. (www.nsga.org) SportsBusiness Journal, 112 South Tryon Street, Suite 1600, Charlotte, NC 28284. (704) 371-3100. (www.sportsbusinessjournal.com)

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The Sports & Fitness Industry Association (SFIA), 8505 Fenton Street, Suite 211, Silver Spring, MD 20910. (301) 495-6321. (www.sfia.org)

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61 SPORTS & RECREATION PARTICIPATION

61.1 Overview The 2014 Sports, Fitness and Leisure Participation Topline Report, published by the Sports & Fitness Industry Association (SFIA, www.sfia.org), reported on participation for over 100 sports and recreation activities. The following is a summary of the SFIA assessment.

61.2 Aerobics, Conditioning and Strength Casual participation (one-to-49 times) among those ages six and older and core participation (50 or more times) in aerobics, conditioning, and strength activities in 2013 was as follows (five-year change in participation in parenthesis): Casual

• • • • • • • • • • • • • • • • • • • • • • •

Abdominal machine/device: Aerobics (low impact): Aerobics (step): Aerobics (high impact): Aquatic exercise: Barre: Boot camp style cross-training: Calisthenics/bodyweight training: Cardio cross trainer: Cardio kickboxing: Elliptical motion trainer: Free weights (barbells): Free weights (dumbbells): Free weights (hand weights): Home gym exercise: Other exercise to music: Pilates training: Rowing machine: Running/jogging: Stair climbing machine: Stationary cycling (group): Stationary cycling (recumbent): Stationary cycling (upright):

7.9 million (0%) 11.9 million (3%) 5.3 million (0%) 9.0 million (11%) 5.3 million (-2%) 2.3 million (n/a) 4.5 million (n/a) 3.8 million (n/a) 2.7 million (n/a) 4.1 million (6%) 13.4 million (4%) 9.6 million (3%) 11.6 million (n/a) 17.5 million (n/a) 10.7 million (2%) 12.3 million (5%) 4.8 million (-2%) 5.7 million (4%) 24.3 million (7%) 7.4 million (-1%) 5.3 million (8%) 5.9 million (1%) 12.4 million (1%)

Core

10.5 million (-3%) 13.1 million (0%) 3.6 million (-2%) 8.3 million (6%) 3.3 million (-2%) 625,000 (n/a) 2.4 million (n/a) 6.8 million (n/a) 2.7 million (n/a) 2.2 million (5%) 13.7 million (1%) 16.0 million (-2%) 20.6 million (n/a) 25.7 million (n/a) 14.8 million (-1%) 11.2 million (-2%) 3.3 million (-3%) 4.4 million (1%) 29.8 million (5%) 5.3 million (-4%) 3.1 million (2%) 5.3 million (-1%) 11.7 million (-2%)

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• • • • • • •

Stretching: Swimming for fitness: Tai Chi: Treadmill: Walking for fitness: Weight/resistance machine: Yoga:

9.7 million (4%) 16.9 million (n/a) 2.0 million (2%) 21.7 million (1%) 37.5 million (2%) 14.9 million (0%) 14.1 million (6%)

26.5 million (-1%) 9.4 million (n/a) 1.4 million (-2%) 26.4 million (-2%) 79.8 million (1%) 21.4 million (-2%) 10.2 million (8%)

61.3 Individual Sports Casual participation (one-to-12 times) and core participation (13 or more times) in individual sports in 2013 was as follows (five-year change in participation in parenthesis): Casual

• • • • • • • • • • • • • • • • • • • •

Adventure racing: Archery: Billiards/pool: Bowling: Boxing for fitness: Boxing for competition: Darts: Golf (9/18 hole courses): Horseback riding: Ice skating: Martial arts: Mixed martial arts (competition): Mixed martial arts (fitness): Roller skating (2x2 wheels): Roller skating (inline wheels): Scooter riding (non-motorized): Skateboarding: Trail running: Triathlon (non-traditional/off-road): Triathlon (traditional/road):

901,000 (39%) 6.2 million (4%) 23.2 million (-6%) 35.7 million (-4%) 2.5 million (n/a) 982,000 (n/a) 11.3 million (-6%) 24.7 million (-3%) 5.6 million (-6%) 9.0 million (-1%) 1.5 million (2%) 783,000 (n/a) 1.2 million (n/a) 5.2 million (-5%) 4.2 million (-7%) 1.8 million (-6%) 3.7 million (-3%) 6.8 million (8%) 418,000 (23%) 741,000 (20%)

Core

1.2 million (15%) 1.3 million (4%) 11.4 million (-9%) 10.5 million (-6%) 2.7 million (n/a) 158,000 (n/a) 5.3 million (-8%) n/a 2.5 million (-7%) 1.7 million (0%) 3.8 million (-7%) 194,000 (n/a) 1.1 million (n/a) 1.4 million (-4%) 1.9 million (-15%) 2.3 million (-12%) 2.6 million* (-7%) n/a 672,000 (25%) 1.5 million (20%)

* core participation is 26 or more times

61.4 Racquet Sports Casual participation (one-to-12 times) and core participation (13 or more times) in racquet sports in 2013 was as follows (five-year change in participation in parenthesis): Casual

• •

Badminton: Cardio tennis:

4.8 million (0%) 1.5 million (7%)

Core

2.3 million (1%) n/a

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• • • •

Racquetball: Squash: Table tennis: Tennis:

2.6 million (0%) 1.1 million (23%) 12.4 million (2%) 17.7 million (0%)

1.2 million (-9%) 332,000* (5%) 4.7 million (-1%) n/a

* core participation is 8 or more times

61.5 Team Sports Casual participation and core participation (defined by a different number of times for various sports) in team sports in 2013 was as follows (five-year change in participation in parenthesis): Casual

• • • • • • • • • • • • • • • • • • • • • • • •

Baseball: Basketball: Cheerleading: Field hockey: Football (flag): Football (touch): Football (tackle): Gymnastics: Ice hockey: Lacrosse: Paintball: Roller hockey: Rugby: Soccer (indoor): Soccer (outdoor): Softball (fast pitch): Softball (slow pitch): Swimming on a team: Track and field: Ultimate frisbee: Volleyball (beach/sand): Volleyball (court): Volleyball (grass): Wrestling:

4.2 million (-2%) 7.0 million (-3%) 1.7 million (6%) 727,000 (6%) 2.8 million (-7%) 3.9 million (-2%) 2.6 million (-6%) 3.2 million (7%) 1.1 million (9%) 914,000 (15%) 2.5 million (-4%) 841,000 (-2%) 756,000 (19%) 2.0 million (0%) 6.5 million (-3%) 1.1 million (2%) 2.7 million (-6%) 1.2 million (n/a) 1.8 million (-3%) 3.7 million (4%) 3.3 million (4%) 2.7 million (-3%) 3.0 million (-3%) 948,000 (-11%)

Core #

Core Participation

13+ 13+ 26+ 8+ 13+ 13+ 26+ 50+ 13+ 13+ 8+ 13+ 8+ 13+ 26+ 26+ 13+ 50+ 26+ 13+ 13+ 13+ 13+ 26+

9.1 million (-4%) 16.7 million (-1%) 1.6 million (-4%) 747,000 (6%) 2.8 million (-3%) 3.2 million (-8%) 3.6 million (-3%) 1.8 million (2%) 1.3 million (3%) 899,000 (8%) 1.0 million (-12%) 457,000 (-5%) 427,000 (8%) 2.8 million (3%) 6.2 million (-1%) 1.4 million (2%) 4.2 million (-7%) 1.5 million (n/a) 2.3 million (-2%) 1.3 million (1%) 1.5 million (5%) 3.7 million (-3%) 1.1 million (-6%) 881,000 (-10%)

61.6 Outdoor Sports Casual participation and core participation (defined by a different number of times for various sports) in outdoor sports in 2013 was as follows (five-year change in participation in parenthesis):

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Casual

• • • • • • • • • • • • • • • • •

Bicycling - BMX: 1.1 million (9%) Bicycling - mountain: 3.8 million (3%) Bicycling - road/paved: 19.5 million (2%) Climbing (sport/indoor): 4.7 million (1%) Climbing (traditional): 2.3 million (2%) Fishing (fly): 3.8 million (5%) Fishing (freshwater): 20.1 million (1%) Fishing (saltwater): 7.1 million (-3%) Hiking (day): 34.2 million (2%) Hunting (bow): 2.2 million (5%) Hunting (handgun): 2.1 million (5%) Hunting (rifle): 7.1 million (0%) Hunting (shotgun): 4.8 million (2%) Shooting (sport clays): 3.1 million (0%) Shooting (trap/skeet): 2.5 million (3%) Target shooting (handgun): 8.4 million (5%) Target shooting (rifle): 7.6 million (2%)

Core #

Core Participation

13+ 13+ 26+ 8+ 8+ 8+ 8+ 8+ 13+ 8+ 8+ 8+ 8+ 8+

1.0 million (-2%) 4.8 million (4%) 21.4 million (1%) n/a n/a 2.1 million (-6%) 17.7 million (-5%) 4.7 million (-4%) n/a 1.9 million (-1%) 1.1 million (2%) 2.7 million (-5%) 7.1 million (-6%) 1.4 million (-5%) 1.3 million (-1%) 6.0 million (1%) 5.4 million (-1)

61.7 Water Sports Casual participation (one-to-seven times) and core participation (8 or more times) in water sports in 2013 was as follows (five-year change in participation in parenthesis): • • • • • • • • • • • • • •

Boardsailing/windsurfing: Canoeing: Jet skiing: Kayaking (recreational): Kayaking (sea touring): Kayaking (white water): Rafting: Sailing: Scuba diving: Snorkeling: Stand-up paddling: Surfing: Wakeboarding: Water skiing:

Casual

Core

1.1 million (4%) 10.2 million (1%) 4.4 million (-2%) 8.7 million (9%) 2.7 million (11%) 2.1 million (12%) 3.8 million (-3%) 2.7 million (2%) 2.4 million (3%) 6.9 million (-2%) 1.9 million (n/a) 1.6 million (3%) 2.3 million (-1%) 3.1 million (-4%)

234,000 (-3%) n/a 2.0 million (-7%) n/a n/a n/a n/a 1.2 million (-4%) 823,000 (-4%) 1.8 million (-4%) n/a 1.0 million (1%) 1.0 million (-2%) 1.1 million (-10%)

61.8 Market Resources Sports & Fitness Industries Association, 8505 Fenton Street, Suite 211, Silv er Spring, MD 20910. (301) 495-6321. (www.sfia.org) Retail Business Market Research Handbook 2015-2016

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62 SPORTING GOODS SHOPPING

62.1 Shopping At Sporting Goods Stores International Demographics (www.themediaaudit.com) has surveyed adults in 83 metropolitan areas assessing the percentages that shop at sporting goods stores. On average, 27.2% of adults in the 83 metropolitan areas reportedly shop at a sporting goods stores at least once per month. The following metropolitan areas have the highest percentages of adults that shop at sporting goods stores at least once per month: • Boise, ID: 40.7% • Little Rock, AR: 40.7% • Reno, NV: 40.3% • Syracuse, NY: 39.9% • Houston, TX: 37.6% • Los Angeles, CA: 34.7% • Spokane, WA: 33.6% • Dallas-Ft. Worth, TX: 33.0% • Nashville, TN: 32.7% • Grand Rapids, MI: 32.1% Data on the percentages of adults from all 83 metropolitan areas that shop at sporting goods stores is available online at www.themediaaudit.com/press/local-releases.

62.2 Market Resources International Demographics, 10333 Richmond Avenue, Suite 200, Houston, TX 77042. (713) 626-0333. (www.themediaaudit.com)

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PART XI: SUPERMARKETS & GROCERIES

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63 MARKET ASSESSMENT

63.1 Market Assessment According to the Census Bureau (www.census.gov) of the U.S. Department of Commerce, total sales at grocery stores (NAICS Code 44511) have been as follows: • 2004: $441.14 billion • 2005: $435.52 billion • 2006: $448.69 billion • 2007: $468.35 billion • 2008: $487.65 billion • 2009: $487.17 billion • 2010: $495.17 billion • 2011: $519.47 billion • 2012: $534.77 billion • 2013: $546.69 billion • 2014: $566.32 billion These figures do not include food sales at supercenters or other general merchandise stores. Sales in 2014 were distributed by month as follows: • January: $ 46.95 billion • February: $ 42.89 billion • March: $ 46.45 billion • April: $ 46.05 billion • May: $ 48.82 billion • June: $ 46.50 billion • July: $ 48.24 billion • August: $ 48.12 billion • September: $ 45.90 billion • October: $ 48.07 billion • November: $ 48.17 billion • December: $ 50.13 billion

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63.2 Segment Profile The Food Marketing Institute (FMI, www.fmi.org) provides the following profile of the supermarket and grocery segment: • Total sales (2013) - supermarkets, supercenters, and other retailers with $2 million in annual food sales: $620.22 billion • Net profit after taxes: 1.3% • Number of supermarkets: 37,459 • Number of employees: 3.4 million • Median supermarket store size: 46,500 sq. ft. • Median average weekly sales per supermarket: $482,160 • Average number of items carried in a supermarket: 43,844 • Average sales per customer transaction: $30.62 • Average number of trips per consumer per week to the supermarket: 1.6 • Weekly sales per sq. ft. of selling area: $11.85 • Sales per labor hour: $137.00

• • • • • • • • •

The distribution of supermarket sales by department is as follows (source: FMI): Dry grocery: 26% Meat/fish/poultry: 14% Produce: 11% Dairy: 9% Frozen foods: 7% Non-food grocery: 7% Health & beauty/pharmacy: 6% Deli (service and self-serve): 5% Alcoholic beverages: 4%

63.3 Market Resources Food Marketing Institute, 2345 Crystal Avenue, Arlington, VA 22202. (202) 452-8444. (www.fmi.org)

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64 LARGEST SUPERMARKET CHAINS

64.1 Marketshare Leaders Supermarket News publishes an annual list of the Top 75 Retailers & Wholesalers, ranking chains by annual consumables sales. The 2014 list* of U.S. retail chains is as follows: •

Walmart (www.walmart.com):

Revenue

Stores

$221.8 billion

4,987

$108.8 billion

2,631

$ 90.5 billion $ 73.6 billion $ 37.1 billion

539 1,921 1,326

$ 30.4 billion $ 26.0 billion

1,090 766

$ 25.3 billion $ 23.0 billion

8,285 1,103

$ 20.9 billion

352

$ 17.8 billion

1,361

$ 17.8 billion $ 17.7 billion

11,100 615

$ 15.1 billion $ 14.1 billion

204 85

$ 12.9 billion

367

Brands: Walmart, Walmart Supercenters, Walmart Market, Walmart Express, Sam’s Club

•

Kroger (www.kroger.com): Brands: Kroger, Ralphs, King Soopers, City Market, Dillons, Smith’s, Fry’s, QFC, Baker’s, Owen’s, Jay C, Gerbes, Pay Less Super Markets, Scott’s Food & Pharmacy, Kroger Fresh Fare, Food 4 Less, Foods Co, Fred Meyer, Fry’s Marketplace, Smith’s Marketplace, Kroger Marketplace, Dillon Marketplace

• • •

Costco Wholesale (www.costco.com): Target (www.target.com): Safeway (www.safeway.com): Brands: Safeway, Vons, Randalls, Tom Thumb, Genuardi’s, Carrs

• •

Publix Super Markets (www.publix.com): Ahold USA (www.aholdusa.com): Brands: Giant Foods, Stop & Shop

• •

7-Eleven (www.7-eleven.com): Albertsons (www.albertsonsmarket.com): Brands: Acme, Albertsons, Amigos, Jewel-Osco, Market Street, Shaw’s/Star Market, United

•

H.E. Butt Grocery Co. (www.heb.com): Brand: H-E-B

•

Delhaize America (www.delhaizeamerica.com): Brands: Bottom Dollar Food, Food Lion, Hannaford Bros.

• •

Dollar General Corp. (www.dollargeneral.com): Supervalu (www.supervalu.com): Brands: Cub Foods, Farm Fresh, Hornbacher’s, Save-A-Lot, Shop ‘N Save, Shoppers

• •

Meijer (www.meijer.com): Wakefern Food Corp. (www.wakefern.com)

•

Whole Foods Market (www.wholefoodsmarket.com):

Brands: PriceRite, ShopRite

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• • • • • • • •

BJ’s Wholesale Club (www.bjs.com): Trader Joe’s Market (www.traderjoes.com): Family Dollar Stores (www.familydollar.com): Bi-Lo (www.bi-lo.com): Giant Eagle (www.gianteagle.com): Aldi (www.aldifoods.com): Hy-Vee Food Stores (www.hy-vee.com): SpartanNash (www.spartannash.com):

$ $ $ $ $ $ $ $

11.8 billion 11.3 billion 10.4 billion 10.3 billion 9.9 billion 8.0 billion 8.0 billion 7.4 billion

201 415 7,916 684 421 1,227 234 177

$ $ $ $ $ $ $ $ $ $ $

6.8 billion 5.9 billion 5.7 billion 4.3 billion 4.3 billion 4.0 billion 3.9 billion 3.7 billion 3.5 billion 3.2 billion 3.0 billion

83 305 94 71 225 163 167 203 132 132 452

$ $ $ $ $ $

3.0 billion 2.7 billion 2.6 billion 2.4 billion 2.4 billion 2.1 billion

159 165 100 240 167 105

$

2.1 billion

43

$ $ $ $

2.0 billion 1.8 billion 1.6 billion 1.6 billion

152 350 124 29

$ $ $ $

1.6 billion 1.5 billion 1.5 billion 1.5 billion

42 61 149 29

$ $ $ $

1.5 billion 1.4 billion 1.4 billion 1.3 billion

15 202 114 249

Brands: Spartan Stores, Nash Finch

• • • • • • • • • • •

Wegmans (www.wegmans.com): A&P (www.apsupermarket.com): WinCo Foods (www.wincofoods.com): Demoulas Market Basket (www.mbfoods.com): Save Mart Supermarkets (www.savemart.com): Roundy’s Supermarkets (www.roundys.com): Stater Bros. (www.staterbros.com): Ingles Markets (www.ingles-markets.com): Price Chopper (www.pricechopper.com): Raley’s (www.raleys.com): Houchens Industries (www.houchens.com): Brands: Buehler Foods, Everyday IGA, Food Giant, Houchens Markets, Mad Butcher, Piggley Wiggly, White’s Fresh Foods

• • • • • •

Tops Markets (www.topsmarkets.com): Weis Markets (www.weismarkets.com): Schnuck Markets (www.schnucks.com): Smart & Final (www.smartandfinal.com): Sprouts Farmers Market (www.sprouts.com): K-VA-T Food Stores (www.foodcity.com):

•

Associated Food Stores (www.afstores.com):

Brand: Food City Brands: Dan’s, Dick’s Market, Lin’s, Macey’s

• • • •

Brookshire Grocery Co. (www.brookshires.com): 99 Cents Only Stores (www.99only.com): Bashas’ (www.bashas.com): Saker ShopRite (www.shoprite.com):

• • • •

Superior Grocers (www.superiorgrocers.com): Big Y Foods (www.bigy.com): The Fresh Market (www.thefreshmarket.com): Village Super Market (www.shoprite.com):

Brand: ShopRite

Brand: ShopRite

• • • •

Woodman’s Markets (www.woodmans-food.com): Grocery Outlet (www.croceryoutlet.com): Piggly Wiggly Midwest (www.shopthepig.com): Brookshire Brothers (www.brookshirebrothers.com):

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• • • •

Coborn’s (www.coburns.com): Bodega Latina (www.elsupermarkets.com): Fareway Stores (www.fareway.com): Inserra Supermarkets (www.shoprite.com):

•

Marsh Supermarkets (www.marsh.net):

$ $ $ $

1.3 billion 1.2 billion 1.2 billion 1.2 billion

100 45 106 22

$

1.1 billion

86

Brand: ShopRite * Only U.S. retail chains are listed; the SN list includes wholesalers and Canadian chains.

64.2 Market Resources Supermarket News, 1166 Avenue of the Americas, 10th Floor, New York, NY 10036. (212) 204-4359. (www.supermarketnews.com)

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65 MARKETSHARE BY METROPOLITAN AREA

65.1 Retail Sales In The Largest MSAs This chapter presents marketshare leaders for the 100 largest supermarket metropolitan areas. The Metropolitan Statistical Areas (MSAs) defined by the U.S. Census Bureau (www.census.gov) are used. The assessment is based on research by Rascher Press (www.massmarketretailers.com) and published in the August 2014 issue of Mass Market Retailers. The supermarket market leaders in the top 100 markets are as follows: 1. New York-Northern New Jersey-Long Island, NY-NJ-PA • Stop & Shop: 15%; A&P/Pathmark: 9%; Costco: 7%; Others: 69% 2. Los Angeles-Long Beach-Santa Ana, CA • Ralphs: 15%; Costco: 11%; Safeway: 10%; Albertsons: 7%; Trader Joe’s: 6%; Others: 51% 3. Chicago-Naperville-Joliet, IL-IN-WI • Jewel: 31%; Walmart: 9%; Costco: 8%; Others: 52% 4. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD • Acme: 15%; Giant: 16%; Walmart: 6%; Others: 63% 5. Washington-Arlington-Alexandria-DC-VA-MD-WV • Giant Food: 28%; Safeway: 15%; Costco: 10%; Others: 47% 6. Miami-Fort Lauderdale-Pompano Beach, FL • Publix: 48%; Walmart: 11%; Winn-Dixie: 9%; Others: 32% 7. Atlanta-Sandy Springs-Marietta, GA • Publix: 25%; Kroger: 24%; Walmart: 21%; Others: 30% 8. Houston-Baytown-Sugar Land, TX • Walmart: 21%; Kroger: 20%; H-E-B.: 19%; Others: 40% 9. Boston-Cambridge-Quincy, MA-NH • Stop & Shop: 23%; Shaw’s/Star Market: 16%; DeMoulas/Market Basket: 18%; Whole Foods: 8%; Others: 35%

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10. San Francisco-Oakland-Fremont, CA • Safeway: 28%; Costco: 14%; Save Mart: 13%; Trader Joe’s: 9%; Whole Foods: 7%; Others: 29% 11. Dallas-Fort Worth-Arlington, TX • Walmart: 27%; Kroger: 14%; Safeway/Tom Thumb: 10%; Albertsons: 7%; Others: 42% 12. Seattle-Tacoma-Bellevue, WA • Safeway: 22%; Quality Food Centers: 14%; Costco: 12%; Fred Meyer: 10%; Others: 42% 13. Phoenix-Mesa-Scottsdale, AZ • Fry’s: 26%; Walmart: 18%; Safeway: 12%; Bashas: 10%; Costco: 9%; Others: 25% 14. Riverside-San Bernardino-Ontario, CA • Stater Bros.: 25%; Costco: 11%; Albertsons: 7%; Others: 57% 15. San Diego-Carlsbad-San Marcos, CA • Safeway/Vons: 21%; Albertsons: 17%; Costco: 14%; Ralphs: 9%; Others: 39% 16. Detroit-Warren-Livonia, MI • Kroger: 25%; Meijer: 22%; Walmart: 13%; Costco: 9%; Others: 31% 17. Baltimore-Towson, MD • Giant Food: 22%; Safeway: 9%; Others: 69% 18. Tampa-St. Petersburg-Clearwater, FL • Publix: 41%; Walmart: 19%; Bi-Lo: 9%; Others: 31% 19. Denver-Aurora, CO • King Soopers: 31%; Safeway: 17%; Walmart: 16%; Costco: 10%; Others: 26% 20. Minneapolis-St. Paul-Bloomington, MN-WI • Cub/Supervalu: 19%; Target: 14%; Rainbow Foods/Roundy’s: 9%; Lund’s/Byerly’s: 7%; Others: 51% 21. Sacramento-Arden-Arcade-Roseville, CA • Raley’s: 22%; Safeway: 15%; Costco: 12%; Walmart: 11%; Others: 40%

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22. St. Louis, MO-IL • Schnuck Markets: 27%; Walmart: 19%; Supervalu: 16%; Dierberg’s: 11%; Others: 27% 23. Portland-Vancouver-Beaverton, OR-WA • Safeway: 20%; Fred Meyer: 15%; WinCo: 14%; Costco: 11%; Others: 40% 24. Pittsburgh, PA • Giant Eagle: 34%; Walmart: 16%; Others: 50% 25. Cincinnati-Middletown, OH-KY-IN • Kroger: 42%; Walmart: 19%; Meijer: 12%; Others: 27% 26. Austin-Round Rock, TX • H-E-B.: 46%; Walmart: 18%; Randall’s: 8%; Others: 28% 27. San Jose-Sunnyvale-Santa Clara, CA • Safeway: 24%; Costco: 17%; Save Mart: 13%; Others: 46% 28. Orlando-Kissimmee, FL • Publix: 40%; Walmart: 21%; Winn-Dixie: 7%; Others: 32% 29. Las Vegas-Paradise, NV • Walmart: 20%; Smith’s Food & Drug: 19%; Albertsons: 19%; Safeway/Vons: 8%; Others: 34% 30. Providence-New Bedford-Fall River, RI-MA • Stop & Shop: 38%; Shaw’s: 11%; Walmart: 10%; BJ’s: 7%; Others: 34% 31. Columbus, OH • Kroger: 36%; Walmart: 17%; Meijer: 12%; Giant Eagle: 11%; Others: 24% 32. Cleveland-Elyria-Mentor, OH • Giant Eagle: 28%; Walmart: 14%; Heinen’s: 9%; Others: 49% 33. Kansas City, MO-KS • Walmart: 23%; Price Chopper: 13%; Hy-Vee: 11%; Others: 53% 34. Milwaukee-Waukesha-West Allis, WI • Roundy’s/Pick ‘n Save: 42%; Walmart: 14%; Piggly Wiggly: 8%; Others: 36% 35. San Antonio, TX • H-E-B.: 52%; Walmart: 23%; Others: 25%

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36. Charlotte-Gastonia-Concord, NC-SC • Harris Teeter: 27%; Walmart: 20%; Food Lion: 18%; Others: 35% 37. Nashville-Davidson-Murfreesboro-Franklin, TN • Kroger: 26%; Walmart: 24%; Publix: 17%; Others: 35% 38. Hartford-West Hartford-East Hartford, CT • Stop & Shop: 36%; Big Y: 9%; Others: 55% 39. Buffalo-Niagara Falls, NY • Tops Markets: 33%; Wegmans: 29%; Walmart: 10%; Others: 28% 40. Bridgeport-Stamford-Norwalk, CT • Stop & Shop: 34%; ShopRite: 16%; Stew Leonard: 8%; Others: 42% 41. Rochester, NY • Wegmans: 47%; Walmart: 16%; Tops Markets: 12%; Others: 25% 42. Indianapolis-Carmel, IN • Kroger: 27%; Walmart: 23%; Marsh: 12%; Meijer: 10%; Others: 28% 43. Jacksonville, FL • Publix: 35%; Walmart: 24%; Winn-Dixie: 17%; Others: 24% 44. Virginia Beach-Norfolk-Newport News, VA-NC • Food Lion: 23%; Walmart: 21%; Farm Fresh: 18%; Harris Teeter: 8%; Others: 30% 45. Salt Lake City, UT • Smith’s Food & Drug: 23%; Walmart: 20%; Harmon’s: 11%; Costco: 10%; Others: 56% 46. Louisville-Jefferson County, KY-IN • Kroger: 32%; Walmart: 25%; Meijer: 10%; Others: 33% 47. Richmond, VA • Giant: 20%; Food Lion: 19%; W almart: 18%; Kroger: 13%; Others: 30% 48. Tucson, AZ • Fry’s: 24%; Walmart: 18%; Safeway: 16%; Costco: 9%; Others: 33% 49. Raleigh-Cary, NC • Walmart: 25%; Harris Teeter: 19%; Food Lion: 18%; Others: 38%

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50. Memphis, TN-MS-AR • Kroger: 39%; Walmart: 26%; Others: 35% 51. Allentown-Bethlehem-Easton, PA-NJ • Giant: 25%; Weis Markets: 12%; Wegmans: 11%; Others: 52% 52. New Haven-Milford, CT • Stop & Shop: 39%; Costco: 8%; Big Y Foods: 8%; Others: 45% 53. Oxnard-Thousand Oaks-Ventura, CA • Safeway/Vons: 27%; Ralphs: 13%; Albertsons: 11%; Costco: 9%; T rader Joe’s: 8%; Others: 32% 54. Albany-Schenectady-Troy, NY • Price Chopper: 32%; Hannaford: 21%; Walmart: 13%; Stewart’s: 9%; Others: 25% 55. Omaha-Council Bluffs, NE-IA • Walmart: 21%; SpartanNash: 20%; Hy-Vee: 18%; Dillon/Baker’s: 13%; Target: 8%; Others: 20% 56. Worcester, MA • Stop & Shop: 17%; Walmart: 12%; Price Chopper: 11%; Hannaford: 10%; Shaw’s: 10%; Others: 40% 57. New Orleans-Metairie-Kenner, LA • Walmart: 32%; Rouse’s Supermarket: 19%; Winn-Dixie: 18%; Sam’s Club: 10%; Others: 21% 58. Fresno, CA • Save Mart: 25%; Costco: 15%; WinCo: 11%; Walmart: 9%; Safeway: 8%; Others: 32% 59. Sarasota-Bradenton-Venice, FL • Publix: 46%; Walmart: 23%; Others: 31% 60. Birmingham-Hoover, AL • Walmart: 41%; Publix: 19%; Others: 40% 61. Bakersfield, CA • Albertsons: 20%; Costco: 12%; Safeway: 11%; Save Mart: 10%; Others: 47%

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62. Springfield, MA • Big Y: 32%; Stop & Shop: 28%; W almart: 11%; Others: 29% 63. Oklahoma City, OK • Walmart: 42%; Crest Foods: 12%; Homeland: 9%; Others: 37% 64. Poughkeepsie-Newburgh-Middletown, NY • Wakefern: 23%; Stop & Shop: 19%; Hannaford: 11%; Walmart: 10%; Others: 37% 65. Syracuse, NY • Wegmans: 34%; Tops Markets: 19%; Walmart: 15%; Price Chopper: 11%; Others: 21% 66. Santa Rosa-Petaluma, CA • Safeway: 26%; Costco: 16%; Whole Foods: 15%; Save Mart: 13%; Raley’s: 10%; Others: 20% 67. Portland-South Portland-Biddeford, ME • Hannaford: 47%; Shaw’s: 21%; Walmart: 15%; Others: 17% 68. Fort Myers-Cape Coral, FL • Publix: 43%; Walmart: 16%; Costco: 9%; Others: 32% 69. Dayton, OH • Kroger: 35%; Walmart: 24%; Meijer: 15%; Sam’s Club: 8%; Others: 18% 70. Akron, OH • Giant Eagle: 25%; Fred W. Albrecht: 20%; Walmart: 18%; Others: 37% 71. Honolulu, HI • Foodland: 23%; Costco: 21%; PAQ: 16%; Saf eway: 14%; Don Quijote Foods: 9%; Others: 17% 72. Wichita, KS • Dillon: 39%; Walmart: 37%; Others: 24% 73. Knoxville, TN • Walmart: 27%; Kroger: 20%; K-VA-T: 18%; Others: 35% 74. Stockton, CA • Costco: 24%; Save Mart: 19%; Raley’s: 10%; WinCo: 9%; Safeway: 8%; Others: 30%

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75. Albuquerque, NM • Walmart: 29%; Smith’s Food & Drug: 23%; Albertsons: 12%; Weis Markets: 14%; Others: 22% 76. Harrisburg-Carlisle, PA • Giant: 38%; Walmart: 15%; Weis Markets: 14%; Others: 33% 77. Madison, WI • Roundy’s: 25%; Costco: 13%; Woodman’s: 11%; Walmart: 10%; Others: 41% 78. Scranton-Wilkes-Barre, PA • Walmart: 19%; Weis Markets: 14%; Price Chopper: 10%; W egmans: 11%; Others: 46% 79. Charleston-North Charleston, SC • Walmart: 22%; Publix: 17%; Bi-Lo: 15%; Food Lion: 9%; Others: 77% 80. McAllen-Edinburgh-Mission, TX • H-E-B.: 57%; Walmart: 28%; Others: 15% 81. Des Moines, West Des Moines, IA • Hy-Vee: 29%; Walmart: 19%; Dahl’s: 16%; Fareway: 9%; Others: 27% 82. Lancaster, PA • Giant: 31%; Weis Markets: 21%; Others: 48% 83. Toledo, OH • Kroger: 32%; Walmart: 22%; Meijer: 18%; Others: 28% 84. Columbia, SC • Walmart: 31%; Bi-Lo: 17%; Food Lion: 14%; Publix: 13%; Others: 25% 85. Santa Barbara-Santa Maria-Goleta, CA • Safeway: 20%; Albertsons: 20%; Costco: 17%; Ralphs: 9%; Others: 34% 86. Greenville-Mauldin-Easley, SC • Bi-Lo: 24%; Walmart: 23%; Publix: 15%; Ingles: 13%; Others: 25% 87. Manchester-Nashua, NH • DeMoulas/Market Basket: 29%; Hannaford: 20%; Shaw’s: 19%; Others: 32% 88. Modesto, CA • Save Mart: 23%; Costco: 17%; Walmart: 12%; Raley’s: 11%; Others: 37%

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89. Tulsa, OK • Walmart: 42%; Reasor’s: 18%; Warehouse Markets: 8%; Others: 32% 90. Greensboro-High Point, NC • Walmart: 30%; Food Lion: 26%; Harris Teeter: 16%; Others: 28% 91. Baton Rouge, LA • Walmart: 48%; Albertsons: 12%; Winn-Dixie: 9%; Others: 31% 92. Boise City-Nampa, ID • Albertsons: 29%; Walmart: 19%; WinCo: 18%; Fred Meyer: 11%; Costco: 10%; Others: 13% 93. Spokane, WA • Safeway: 18%; Walmart: 13%; Costco: 12%; Albertsons: 11%; Rosauers: 10%; Others: 36% 94. Little Rock-North Little Rock, AR • Walmart: 46%; Kroger; 32%; Others: 22% 95. Melbourne-Palm Bay-Titusville, FL • Publix: 43%; Walmart: 25%; Winn-Dixie: 10%; Others: 24% 96. Colorado Springs, CO • Walmart: 30%; King Soopers: 17%; Safeway: 13%; Costco: 10%; Others: 30% 97. Asheville, NC • Ingles Markets: 39%; Walmart: 25%; Others: 36% 98. Daytona Beach-Ormond Beach, FL • Publix: 43%; Walmart: 25%; Winn-Dixie: 14%; Others: 18% 99. Trenton-Ewing, NJ • ShopRite: 38%; Wegmans: 11%; Acme: 9%; Others: 42% 100. Youngstown-Warren-Boardman, OH-PA • Giant Eagle: 28%; Walmart: 24%; Others: 48%

65.2 Market Resources Mass Market Retailers (MMR), Racher Press, Inc., 220 Fifth Avenue, New York, NY 10001. (212) 213-6000. (www.massmarketretailers.com)

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66 CUSTOMER SPENDING

66.1 Spending At Supermarkets International Demographics (www.themediaaudit.com) has surveyed adults in 83 metropolitan areas assessing their average weekly spending in supermarkets. On average, adults in the 83 metropolitan areas reportedly spend $135 each week at supermarkets. The following metropolitan areas have the highest average weekly spending at supermarkets (source: International Demographics [www.themediaaudit.com]): • Reno, NV: $163 • Long Island, NY: $157 • Las Vegas, NV: $156 • Oklahoma City, OK: $155 • San Francisco, CA: $155 • Dallas-Ft. Worth, TX: $154 • New Orleans, LA: $153 • Albany-Schenectady-Troy, NY: $152 • Houston, TX: $150 • Jackson, MS: $150 Data on weekly spending at supermarkets in 83 metropolitan areas is available online at www.themediaaudit.com/press/local-releases.

66.2 Market Resources International Demographics, 10333 Richmond Avenue, Suite 200, Houston, TX 77042. (713) 626-0333. (www.themediaaudit.com)

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67 CPG SALES IN SUPERMARKETS

67.1 Sales at Mass Market Retail Stores According to Mass Market Retailers (MMR), based on analysis by IRI (www.iriworldwide.com), sales of consumer packaged goods (CPGs) in supermarkets for the 12-month period ending October 6, 2014 were as follows (change from previous year in parenthesis): • Carbonated beverages: $11.24 billion • Milk: $10.51 billion • Fresh bread & rolls: $ 9.41 billion • Salty Snacks: $ 9.11 billion • Beer/ale/alcoholic cider: $ 9.10 billion • Natural cheese: $ 8.14 billion • Wine: $ 6.68 billion • Cold Cereal: $ 5.59 billion • Frozen dinners/entrees: $ 5.41 billion • Yogurt: $ 4.90 billion • Bottled water: $ 4.43 billion • Coffee: $ 4.39 billion • Refrigerated juices/drinks: $ 4.28 billion • Ice cream/sherbet: $ 4.35 billion • Crackers: $ 4.16 billion • Cookies: $ 3.99 billion • Cigarettes: $ 3.90 billion • Soup: $ 3.82 billion • Refrigerated fresh eggs: $ 3.57 billion • Breakfast meat: $ 3.52 billion • Luncheon meat: $ 3.36 billion • Chocolate candy: $ 3.32 billion • Bottled juices - shelf stable: $ 3.22 billion • Toilet tissue: $ 3.09 billion • Dog food: $ 3.08 billion • Refrigerated salad/coleslaw: $ 3.05 billion • Spirits/liquor: $ 2.89 billion • Frozen pizza: $ 2.78 billion • Frozen novelties: $ 2.66 billion • Frozen seafood: $ 2.38 billion

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Snack bars/granola bars: Laundry detergent: Vegetables: Frozen/refrigerated poultry: Shortening & oil: Spices/seasonings: Baby formula/electrolytes: Dinner sausage: Cat food: Creams/creamers: Processed cheese: Paper towels: Processed frozen/refrigerated poultry: Snack nuts/seeds: Frozen plain vegetables: Mexican food: Frozen breakfast food: Frankfurters: Pastry/doughnuts: Sports drinks: Pasta: Spaghetti/Italian sauces: Refrigerated side dishes: Non-chocolate candy: Canned/bottled fruit: Pickles/relish/olives: Butter/butter blends: Food bags & trash bags: Seafood - shelf stable: Rice: Salad dressings - shelf stable: Frozen meat: Refrigerated meat: Dough/biscuit dough - refrigerated: Baking needs: Tea/coffee ready-to-drink: Dry packaged dinners: Vitamins: Margarine/spreads: Dinners - shelf stable: Peanut butter: Mayonnaise: Sugar: Cups & plates:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

2.32 billion 2.30 billion 2.30 billion 2.24 billion 2.14 billion 2.14 billion 2.07 billion 2.06 billion 2.04 billion 2.03 billion 1.99 billion 1.86 billion 1.85 billion 1.78 billion 1.78 billion 1.72 billion 1.71 billion 1.68 billion 1.65 billion 1.62 billion 1.59 billion 1.54 billion 1.54 billion 1.54 billion 1.53 billion 1.52 billion 1.47 billion 1.46 billion 1.46 billion 1.43 billion 1.43 billion 1.40 billion 1.38 billion 1.33 billion 1.29 billion 1.26 billion 1.25 billion 1.25 billion 1.23 billion 1.32 billion 1.22 billion 1.22 billion 1.18 billion 1.15 billion

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Meat & refrigerated ham - shelf stable: Bakery snacks: Baking mixes: Soap: Frozen potatoes/onions: Tomato products: Mexican sauce: Pies & cakes: Energy drinks: Dish detergent: Cream cheese/cream cheese spreads: Household cleaners: Frozen appetizers/snack rolls: Jellies/jams/honey: Weight control: Diapers: Refrigerated entrees: Gravy/sauce mixes: Sauces - other: Internal analgesics: Lunches - refrigerated: Hot cereal: Aseptic juices: Cottage cheese: Cold/allergy/sinus tablets: Sour cream: Tea - bags/loose: Baby food: Pet supplies: Mustard/ketchup: Toothpaste: Gum: Frozen bread/frozen dough: Cat/dog litter: Shampoo: Sanitary napkins/tampons: Facial tissue: Gastrointestinal tablets: Popcorn/popcorn oil: Drink mixes: Deodorant: Batteries: Air fresheners: Blades:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

1.12 billion 1.12 billion 1.12 billion 1.09 billion 1.05 billion 1.04 billion 1.03 billion 1.00 billion 1.01 billion 1.00 billion 999 million 998 million 968 million 952 million 936 million 910 million 877 million 841 million 813 million 809 million 805 million 804 million 803 million 802 million 799 million 792 million 778 million 766 million 757 million 756 million 720 million 707 million 679 million 650 million 629 million 622 million 621 million 610 million 596 million 573 million 568 million 562 million 526 million 523 million

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• • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Foils & wraps: Skin care: Cleaning tools/mops/brooms: Toothbrushes: Snacks - miscellaneous: Hair conditioner: Moist towelettes: Fabric softener liquid: Laundry care: Mouthwash: Candies: Eye/contact lens care products: Kitchen storage: Hand & body lotion: Hair coloring: Dried meat snacks: Lightbulbs: Adult incontinence: Pest control: First aid treatment: Cold/allergy/sinus liquids: First aid accessories: Cosmetics - eye: Hair styling gel/mousse: Suntan products: Cosmetics - facial: Cosmetics - nail: Baby accessories: Hair accessories:

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

513 million 503 million 459 million 434 million 427 million 395 million 354 million 348 million 334 million 332 million 330 million 325 million 302 million 295 million 282 million 282 million 275 million 270 million 256 million 235 million 229 million 212 million 212 million 199 million 184 million 170 million 153 million 144 million 143 million

67.2 Market Resources Mass Market Retailers (MMR), Racher Press, Inc., 220 Fifth Avenue, New York, NY 10001. (212) 213-6000. (www.massmarketretailers.com) IRI, 150 North Clinton Street, Chicago, IL 60661. (312) 726-1221. (www.iriworldwide.com)

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68 FOOD SALES IN NON-GROCERY FORMATS

68.1 Overview The following are basic food store formats: • The traditional supermarket typically offers about 45,000 SKUs in a 54,000 sq. ft. store. • Limited assortment stores are typically lower price providers offering fewer that 3,000 SKUs in a 12,000 sq. ft. format. • Fresh format stores emphasize perishables and offer healthful prepared food as well as natural and organic center-store products. • Convenience stores are typically small, higher-margin stores offering popular staple groceries, ready-to-heat and ready-to-eat food, and non-food products. Consumers have been increasingly purchasing groceries from non-traditional format retail outlets in recent years. Food store channels have blurred as consumers balance convenience, quality, and price when they shop for groceries.

68.2 Marketshare Assessment According to The Future of Food Retailing, a 2014 report by Willard Bishop (www.willardbishop.com), retail food product marketshare has been distributed as follows: Grocery/Supermarket

Non-traditional

90% 50% 48% 47%

10% 50% 52% 53%

• • • •

1998: 2006: 2009: 2013:

• • • • • • •

Retail food product marketshare in 2013 was distributed as follows: Traditional groceries/supermarkets: 47% Supercenters: 18% Convenience stores: 14% Warehouse clubs: 9% Drug stores: 6% Mass merchandiser/discount stores: 5% Dollar stores: 2%

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68.3 Market Resources Willard Bishop, 840 South Northwest Highway, Barrington, IL 60010. (847) 381-4443. (www.willardbishop.com)

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69 GROCERY SHOPPING ONLINE

69.1 Overview Grocery shopping online was expected to have great potential in the late 1990s when Webvan and other companies offered services like home delivery within half-hour slots. The costs and scheduling of home delivery proved too challenging, Webvan collapsed in 2001, and interest in online grocery shopping faded. Several supermarket chains and startups have recently launched new models for grocery shopping online. The resurgence has been led, in part, by innovative approaches to making home deliveries. _________________________________________________________________

“With so much at stake in the $1 trillion U.S. grocery industry, a hybrid model is emerging: pickup or ordering items online and collecting them at a nearby depot. The practice is already popular overseas.” Time, 2/3/14 _________________________________________________________________

69.2 Market Assessment Datamonitor (www.datamonitor.com) estimates online purchases accounted for about 1.5% of the U.S. grocery market in 2014. For comparison, the online marketshare is about 4.5% in Great Britain, 3.0% in South Korea, 2.5% in Japan, and 2.0% in Germany. The Boston Consulting Group (www.bcg.com) forecasts the global market to increase from $36 billion in 2013 to $100 billion by 2018.

69.3 Case Studies Peapod (www.peapod.com), the biggest online grocer, acts as the Internet arm of the Giant and Stop & Shop chains, both subsidiaries of Ahold. FreshDirect

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(www.freshdirect.com), the second-largest online grocer, is partly owned by Morrisons, a food distributor. Both ventures prosper because they cater to well-off families, largely in cities. Amazon began fresh-food deliveries in Seattle in 2007 and in Los Angeles in 2014. Several more cities are slated to be added in 2015. Safeway, the second-largest supermarket chain in the U.S., is the only grocer besides Ahold with a substantial online operation. In 2014, W almart launched tests of its Walmart To Go service in San Francisco and Denver. Relay Foods (www.relayfoods.com) lets customers order online then pick up their grocery items at a depot. This strategy expands the number of online orders that can be delivered from about four per hour with home delivery to 20 per hour with the pick-up model. Relay Foods offers home delivery for a fee. With service in Charlottesville, Williamsburg, and Baltimore, the company reports that it is adding 1,000 new customers per week. Good Eggs (www.goodeggs.com), an online farmers’ market, makes home deliveries in San Francisco, Los Angeles, New Orleans, and Brooklyn. Other startups include Farmigo (www.farmigo.com), Instacart (www.instacart.com), and Nature Box (www.naturebox.com). _________________________________________________________________

“Online grocery shopping may now be ready for the mainstream, with the presence of major players like Amazon, Safeway and Walmart.” The Wall Street Journal, 1/4/14 _________________________________________________________________

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PART XII: SHOPPING CENTERS

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70 MALLS & SHOPPING CENTERS

70.1 Overview According to 2014 Economic Impact of Shopping Centers, by the International Council of Shopping Centers (ICSC, www.icsc.org), there are 114,485 shopping centers in the United States, about 60% of which are strip centers. The gross leasable area (GLA) of U.S. shopping centers is 7.49 billion sq. ft. Shopping centers account for an estimated $2.2 trillion in sales annually, 55% of all (non-automotive) retail sales. Shopping center sales are $7,875 per capita and are 14.8% of U.S. gross domestic product (GDP). Shopping centers employ approximately 12.5 million people, or 83% of total U.S. retail employment. The nature of mall shopping is undergoing a subtle change: Time-pressed shoppers are becoming more efficient, making fewer visits to malls, but spending more money per trip. But the basic mall demographic profile is relatively unchanged: a typical mall shopper is female, 37 years of age, and lives in a three-person household with median household income of approximately $45,000. Although the majority of consumers still visit malls to shop, many are increasingly attracted to malls for other interests, such as to attend a special event or movie or to dine at a restaurant. Few new enclosed malls have been built during the past decade as developers have focused on new retail formats. Today’s development primarily centers around lifestyle centers, hybrid or power centers, and mixed-use complexes.

70.2 Property Types, Configurations and Primary Trade Areas The International Council of Shopping Centers defines a shopping center as a group of retail and other commercial establishments planned, developed, owned, and managed as a single property. On-site parking is provided. The center’s size and orientation are generally determined by the market characteristics of the trade area served by the center. There are two basic configurations: Mall • Malls typically are enclosed, with a climate-controlled walkway between two facing strips of stores. This represents the most common design mode for regional and superregional centers and has become an informal term for these types of centers.

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Strip Center • A strip center is an attached row of stores or service outlets managed as a coherent retail entity, with on-site parking usually located in front of the stores. Open canopies may connect the storefronts, but a strip center does not have enclosed walkways linking the stores. A strip center may be configured in a straight line, or have an ‘L’ or ‘U’ shape. The term ‘shopping center’ has been evolving since the early 1950s. Given the maturity of the industry, numerous types of centers currently exist that go beyond the standard definitions. Industry nomenclature originally offered four basic terms: neighborhood, community, regional, and superregional centers. However, as the industry has grown and changed, more types of centers have evolved and these four classifications are no longer adequate. The International Council of Shopping Centers defines 10 principal shopping center types. 2014 Economic Impact of Shopping Centers provides the following characteristics of these types as follows: Regional Mall • General merchandise or fashion-oriented offerings. Typically, enclosed with inwardfacing stores connected by a common walkway. Parking surrounds the outside perimeter. • Number in U.S.: 831 • Aggregate SLA: 488,594,847 sq. ft. (6.5% of U.S. total) • Average size: 587,960 sq. ft. • Typical GLA: 400,000 sq. ft. to 800,000 sq. ft. • Acres: 40 to 100 • Typical number of stores: 40 to 80 • Typical number of anchors: 2+ (50% to 70% of GLA) • Typical anchor: Full-line or junior department store, mass merchant, discount department store and/or fashion apparel store • Trade area: 5-to-15 miles Super Regional Mall • Similar in concept to regional malls, but offering more variety and assortment. • Number in U.S.: 680 • Aggregate SLA: 833,812,001 sq. ft. (11.1% of U.S. total) • Average size: 1,226,194 sq. ft. • Typical GLA: 800,000+ sq. ft. • Acres: 60 to 120 • Typical number of anchors: 3+ (50% to 70% of GLA) • Typical anchor: Full-line or junior department store, mass merchant, discount department store and/or fashion apparel store • Trade area: 5-to-25 miles

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Strip/Convenience Center • Attached row of stores or service outlets managed as a coherent retail entity, with on-site parking usually located in front of the stores. Open canopies may connect the store fronts, but a strip center does not have enclosed walkways linking the stores. • A strip center may be configured in a straight line, or have an ‘L’ or ‘U’ shape. • A convenience center is among the smallest of the centers, whose tenants provide a narrow mix of goods and personal services to a very limited trade area. • Number in U.S.: 68,127 • Aggregate SLA: 895,849,415 sq. ft. (12.0% of U.S. total) • Average size: 13,150 sq. ft. • Typical GLA: < 30,000 sq. ft. • Acres: