You choose, we deliver
If you are interested in this story, you might be interested in others from The Journal Gazette. Go to www.journalgazette.net/newsletter and pick the subjects you care most about. We'll deliver your customized daily news report at 3 a.m. Fort Wayne time, right to your email.

Business

  • China detains employees of suspect meat seller
    Five employees of a company accused of selling expired beef and chicken to McDonald’s, KFC and other restaurants in China were detained by police Wednesday after an official said illegal activity was an organized effort by the
  • Meat supplier in China scandal has global reach
    It isn’t a household name, but the company at the center of a food scandal in China helps make some of the world’s most popular foods, including the Big Macs and Quarter Pounders served at McDonald’s locations.
  • IMF sees US growth at weakest since recession
    U.S. economic growth this year will likely be at the weakest pace since the Great Recession ended, the International Monetary Fund said, mostly because of a sharp, weather-related contraction in the first quarter.
Advertisement
Associated Press
Fewer people were in and out of stores during the holidays, but more shopped online. Online shopping rose 10 percent.

Retailers pressed to adapt

Amazon, Wal-Mart take divergent paths for holiday shoppers

– The financial strains and shifting shopping habits of Americans have led to uneven fortunes for retailers.

Traditional consumer companies like Wal-Mart and Mattel have continued to struggle as Americans spend more cautiously in the uncertain economy. But Amazon.com has flourished as shoppers increasingly buy online rather than head to stores.

The trend was evident during the pivotal holiday shopping season, a time roughly from November through December when many retailers can make up to 40 percent of their annual revenue. Overall, government figures show that spending during October through December rose at the fastest clip in three years.

But exactly where – and how – Americans spent their money during the final months of the year shifted. Fewer people were in and out of stores during the holiday season, but more were shopping online.

Online shopping rose 10 percent to $46.5 billion in November and December, according to research firm Comscore. Meanwhile, sales at stores rose just 2.7 percent to $265.9 billion, according to ShopperTrak, which tracks data at 40,000 U.S. stores. The number of customers in stores dropped 14.6 percent.

“Consumer behavior evolved quickly, as retail foot traffic fell, while online purchases grew,” Mattel’s CEO Bry an Stockton said.

Mattel, the world’s largest toymaker, announced that results for the quarter that included the holiday shopping season missed both analysts’ estimates and the company’s own expectations due to weak sales of Barbie and other toys.

“From my perspective, the 2013 holiday period has to be one of the most transformative I have seen,” Stockton said.

Wal-Mart Stores Inc. also expects disappointing results. On Friday, the world’s largest retailer said its fiscal fourth-quarter and full-year adjusted earnings from continuing operations may come in at or slightly below the low end of its prior forecasts.

Wal-Mart is among 33 major retailers that have lowered their outlooks for the fourth quarter and beyond, mostly because of the disappointing holiday shopping season, according to Ken Perkins, president of RetailMetrics LLC., a research firm.

“A highly competitive environment is going to be staring (retailers) in the face throughout the course of 2014. The pressure and competition are not going to abate at all,” Perkins said.

Advertisement