The pandemic might have saved brick-and-mortar shopping as restrictions lift and customers head back to stores
ALEX EDELMAN/AFP/Getty Images
- Walmart, Target, and other retailers reported strong in-store sales.
- Customers are returning to stores in person and making big purchases.
- Analysts say curbside pickup has helped stores weather the pandemic.
- See more stories on Insider's business page.
COVID-19 and a year of staying at home may have saved some brick-and-mortar stores from the retail apocalypse, or at least slowed its advances.
Some of the country's biggest retailers, including Walmart, Macy's, Target, and Home Depot, said sales are strong and shoppers are returning to stores as pandemic restrictions ease and the country reopens. Some experts predict that after more than a year of staying at home because of the lockdowns, people will again embrace shopping in person, kickstarting a new life for some traditional retailers.
Walmart reported over $138 billion in first quarter sales as people return to normal, pre-pandemic shopping behaviors, the big box chain said. "Customers clearly want to get out and shop," Walmart said.
Walmart customers are shopping for different items than they were last year, purchasing more meat, produce, and bakery products, along with a rebound in beauty sales. Apparel, home, outdoor, and sporting good categories all grew as well, Walmart said.
Target saw similar growth, with a 22.9% increase in comparable sales over the same period last year. A slowdown in growth of digital sales seems to be a signs that shoppers are more willing to come into stores to do their shopping in person, reversing the trend of the last year.
"With vaccinations rolling out across the country and consumers increasingly comfortable venturing out, we've seen an enthusiastic return to in-store shopping," Target CEO Brian Cornell told analysts during an earnings call.
Home Depot sales growth continued at nearly 30% for the first quarter, as customers work on home additions concentrated in the lumber, bath, and kitchen areas.
This is a period of "retail reinvention," Cowen senior equity research analyst Oliver Chen told Insider. "There were winners and losers" in the pandemic, he said. "The survivors are getting stronger" and taking more market share, he told Insider, pointing to Walmart and Target as examples.
The rise of curbside pickup also reflects this trend, Chen said, as a kind of midpoint between e-commerce and in-store shopping. It's been embraced by Walmart and Target to great success, with many return customers. Curbside shopping is also ideal for stores, which get the benefit of lower fulfillment costs as customers complete the expensive last mile of shipping themselves.
Macy's, which was already struggling before COVID-19 took a bite out of retailers revenue, said this week that sales jumped 56% in its first quarter compared to the same period last year. CEO Jeff Gennette thinks it's the start of a new trend. "Clearly our customer is ready to get on with life," Gennette said. "We don't see this as a short-term pop. We think this is momentum that has not peaked yet."
Shoppers are likely to continue heading out to stores as more states lift mask requirements, allowing vaccinated customers to shop without a face covering. Walmart and Costco are among stores that have lifted mask requirements.
Do you have a story to share about a retail or restaurant chain? Email this reporter at mmeisenzahl@businessinsider.com.
from Business Insider https://ift.tt/346Fm8V
No comments