Zacks Industry Outlook Highlights: Staples, Macy's, J. C. Penney and Best Buy

Zacks Industry Outlook Highlights: Staples, Macy's, J. C. Penney and Best Buy

PR Newswire

CHICAGO, July 22, 2013

CHICAGO, July 22, 2013 /PRNewswire/ --Today, Zacks Equity Research discusses
the U.S. Retail ,including Staples Inc. (Nasdaq:SPLS-Free Report), Macy's,
Inc. (NYSE:M-Free Report), J. C. Penney Company Inc. (NYSE:JCP-Free Report)
and Best Buy Company Inc. (NYSE:BBY-Free Report).

(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)

Industry: Retail

Link:
http://www.zacks.com/commentary/28210/retail-industry-stock-outlook-july-2013

The retail industry is rapidly evolving with a dramatic change in consumer
buying habits. Satisfying customers and enriching buying experience require
new strategies from retailers today. Modern retailing, interestingly enough,
is a new game with new rules.

Despite the gradual rise in consumer discretionary purchases, the sluggish
U.S. economy and recessionary fears in Europe cannot be ignored. Burdened with
the lackluster scenario, retailers have largely concentrated on buyers' needs
and lured them with innovative products, attractive discounts, free shipping
and the ease of shopping through smartphones and tablets. However, these
strategies only helped in generating modest revenues.

Thus, retailers essentially need to ideate brilliant strategies, while
incorporating technological advancements and utilizing their real estate
portfolio to the optimum level. In short, they need to Experiment,
Differentiate, Optimize and Transform.

Banking on this new mantra, Staples Inc. (Nasdaq:SPLS-Free Report), the
world's largest retailer of office products and services and second largest
online retailer, launched its first omnichannel stores – what it refers to as
the future of retail.

Simply put, through this omnichannel strategy, Staples hopes to integrate its
retail network with enhanced digital capabilities. The company stated that
stores will incorporate its .com and mobile assets. Alongside, the stores will
feature Staples.com kiosks.

This new era store concept, with all its attractions could well prove to be a
game changer in the long run for Staples. Providing shoppers the ease of
shopping on their own terms and enriching their in-store shopping experience
could be a crucial point of differentiation among other retailers.

In harmony with the evolving retail industry, department store operator
Macy's, Inc. (NYSE:M-Free Report) also adopted an omnichannel strategy.
Despite macroeconomic challenges and cautious consumer spending, Macy's
continues to post healthy results. Management largely attributes the credit to
its omnichannel strategy aimed at enhancing customers' shopping experience.

Trends to Rule 2013

Some of the trends that are expected to rule the retail sector this year
include employing more technological solutions, incorporating customer
feedback and targeting additional audiences with products and services.

With the growth of the .com era, shoppers have largely adopted new purchasing
modes, using the Internet, mobile phones and tablets. Consumers today prefer
to use their laptops or smartphones to compare prices of products they want to
buy and place orders online, instead of visiting the company's stores. This
growing trend has guided major U.S. retail chains to downsize their physical
retail operations, and in turn develop their e-Commerce and m-Commerce sites
to attract customers.

Other traits that are expected to affect the retail industry are the growth of
self-service options for processes such as checking out and finding items in
stores. These offerings provide greater convenience and faster transactions,
and they satisfy shoppers who prefer to visit brick-and-mortar locations for
immediately purchasing predetermined items.

Of late, store-within-a store has been making headlines, though the concept is
nothing new to retailers. J. C. Penney Company Inc. (NYSE:JCP-Free Report) is
one such retailer which has been focusing on this business strategy for quite
some time. The recent one to join the league is consumer electronic retailer
Best Buy Company Inc. (NYSE:BBY-Free Report), which has been facing stiff
competition from industry bellwethers.

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