Online sales are a bright spot for some retailers among gloomy financials

Best Buy, Wal-Mart and Abercrombie & Fitch are among the retailers who reported web results that outpaced store sales in December. But Barnes & Noble says web sales declined during the holiday season even faster than same-store sales.

Katie Evans

The web out-performed stores in December for three major retailers that reported their financial results this week. But Barnes & Noble says web sales declined during the holiday season even faster than same-store sales.

The web particularly stood out at consumer electronics heavyweight Best Buy Co. Inc. which reported a 34% increase in online sales for the fiscal month ended Jan. 3 compared to the same month a year ago. Comparable store sales in the U.S. declined 6.8% and for the company as a whole by 6.5% during the same period compared to the year-earlier period. Best Buy did not provide a dollar amount of web sales, but noted that customers migrated to the online channel in December.

Wal-Mart Stores Inc. did not provide details of its web sales, but said in an earnings release, “Sales at walmart.com were significantly ahead of the same period last year, led by sales of entertainment and home products and the site-to-store program.” Site-to-store enables customers to order products online for pickup at a Wal-Mart store without paying shipping charges. Wal-Mart says its same-store sales in the U.S. increased 1.9% in December, not counting gasoline sales.

Apparel retailer Abercrombie & Fitch reported an 18% decline in total sales for the five-week period ended Jan. 3, compared with the similar period a year ago, but a decrease of only 11% in its direct-to-consumer sales, which mainly take place on the web.

Bookseller Barnes & Noble Inc. reported web sales for the nine-week holiday period from Nov. 2 to Jan. 3 declined 11.0% to $114.2 million and for the 48 weeks ended Jan. 3 were down 0.4% to $422.9 million from comparable periods a year ago. Same-store sales for December were down 7.7% and for the 48-week period down 5.4%.

BestBuy.com is No. 12 in the Internet Retailer Top 500 Guide, Walmart.com No. 14, BarnesandNoble.com No. 38 and Abercrombie & Fitch sites No. 54.

Trackers of store sales also reported dismal numbers this week. U.S. chain store sales fell 1.7% in December versus a year earlier and were down 2.2% for the November-December holiday season, according to the International Council of Shopping Centers Inc. “Retailers were forced to slash prices to entice consumers to spend,” says Michael P. Niemira, chief economist and director of research at the council. “But even that strategy was not enough as the elevated worry about job insecurity and increased job layoff announcements continued to restrain consumers’ willingness and ability to spend.”

ShopperTrak reports foot traffic to retail stores for the week ended Jan. 3 was about the same as during the comparable week a year ago, while sales were up 11.6%, an increase it attributed to the calendar shift that gave more consumers days off when they could shop in the week before New Year’s. As expected, traffic for the week ended Jan. 3 was down 26.3% compared with the week ended Dec. 27, 2008, that included the final pre-Christmas shopping surge, and sales were down 34.2%. “The sharp week-over-week declines are more indicative of what we typically see this time of year and we anticipate that even with continued gift card redemptions these slow levels will continue over the next couple of weeks,” says Bill Martin, cofounder of ShopperTrak.

The research firm has adjusted its estimate of 2008 holiday season sales to a decline of 2.4% compared with 2007 and a 15.0% decline in foot traffic. Previously, ShopperTrak had predicted a 0.1% sales increase and a decline in foot traffic of 9.9%.


Christmas and holiday season, Clothing, fashion, same-store sales