Welcome to The Week in Retail, a weekly round-up for marketers from Quad Insights that covers the latest must-know news surrounding the retail space.
Malls to get a boost from Gen Z shoppers this holiday season, report reveals
In a report released this week by commercial real estate company JLL, nearly half of all Gen Z consumers said they plan to do their holiday shopping in malls — 10% higher than the average across all generations. The JLL Holiday Shopping Survey Report 2023 surveyed more than 1,000 consumers to gain an understanding of how and where they plan to shop this holiday season, as well as how much they plan to spend. Outside of malls, consumers overwhelmingly indicated plans to shop at mass merchandisers (57.7%) and department stores (47.4%). The top retailers cited included Amazon at 64.7%, Walmart at 47.6% and Target at 41.8%.
Overall, consumers plan to spend $958 per person this holiday season, with $530 going to gifts, $210 to items like decorations and food, and $218 to entertainment or holiday-related experiences, the report notes.
While shopping and spending habits varied by age and income level, most consumers cited a desire to find more creative ways to save money this holiday season, demonstrating the connection between economic conditions and shopper behavior, Retail Dive’s Tatiana Walk-Morris notes. “The JLL report … highlighted the impact inflation may have on consumers’ finances this holiday season,” she reports. “Though the Consumer Price Index has calmed to about 3.7% above 2022 levels, it has increased more than 21% since 2019.”
Toys “R” Us announces plans to open 24 new stores, as well as airport and cruise ship locations
Six years after filing for bankruptcy, Toys “R” Us is continuing its ambitious comeback. Parent company WHP Global just announced plans to open as many as 24 new standalone Toys “R” Us stores in the U.S. beginning next year through a partnership with Go! Retail Group. In what has been dubbed the “air, land and sea” expansion by WHP Global Chairman and CEO Yehuda Shmidman, the company also has plans to open smaller stores in airports and on cruise ships, with the first Toys “R” Us airport location scheduled to open in November at Dallas Fort Worth International Airport.
WHP Global acquired the brand in 2021, and currently operates 1,400 Toys “R” Us stores and e-commerce sites across 31 countries; 452 of its U.S. physical stores are store-within-a-store formats created through a partnership with Macy’s.
Its standalone store in New Jersey’s American Dream megamall — which has amenities including a two-story slide, café and ice cream shop — will be the model for new Toys “R” Us locations, serving as “epicenters of immersive fun, providing customers with a destination to explore and discover the hottest toys,” according to the company statement.
Macy’s announces plans to triple the number of its smaller-format stores
Macy’s announced on Tuesday accelerated expansion plans, which include opening as many as 30 additional small-format stores beginning in fall 2024. Debuting in 2020, with 11 currently in operation, these stores are about one-fifth the size of a typical Macy’s and are located in strip malls. “Our small-format stores are efficient to operate, provide the customer with a shopping alternative within our omnichannel ecosystem and present a unique opportunity to target high-traffic shopping centers,” Macy’s COO and CFO Adrian Mitchell said in a statement.
These stores offer a more intimate, personalized experience, with “a curated and localized mix of products” and a “more open and modern look than a traditional mall-based Macy’s,” Marianne Wilson of Chain Store Age notes. “In addition, the stores collaborate with local businesses to create pop-ups shops and events that cater to the local community.”
So far, these smaller stores are showing strong results, according to CNBC’s Melissa Repko. “Macy’s small-format stores open for more than one fiscal year have posted comparable sales growth on an owned-plus-licensed basis from the beginning of the fiscal year,” she reports.
Target announces launch of immersive toy-shopping experience, lineup of affordable toys before the holiday season
Target is leaning into the experiential and affordable this holiday season, with a new immersive, digital toy-shopping experience and partnerships with FAO Schwartz and Disney to offer an assortment of toys under $25, the company announced on Tuesday. Understanding that most shopping begins at home, the retailer has created what it’s calling a 360° shoppable experience designed to “make toy discovery easier and more joyful,” per the announcement. In virtual rooms on Target’s website, guests can interact with toys from brands ranging from Barbie to Play-Doh.
As part of its announcement, Target highlighted the extension of its multiyear partnership with toy store FAO Schwartz to sell some of its toys in-store and online. This includes more than 130 items co-created with Target’s team, most of which cost $25 or less.
Also in line with its affordability push, Target has teamed up with Disney to release a limited-time collection of reimagined retro products to celebrate the entertainment company’s 100th anniversary. Most of the collection, which ranges from toys to apparel to entertainment, is priced under $25.
• “Meijer gets into health insurance with new Blue Cross partnership” (Supermarket News)
• “Dollar General opens 1st Montana store” (Winsight Grocery Business)
• “Rihanna’s Fenty Beauty will sell at Target’s Ulta Beauty shops” (The Business Journals)
• “Amazon Opens New Go Store Despite Announced Pause in Grocery Expansion” (Retail TouchPoints)