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Although analysts have called retail as the power and influence of Amazon strengthened, some rebounded, often with the help of their online activities.
A number of retailers and restaurants in recent weeks have reported explosive growth in online sales. Lululemon said on Wednesday that online sales had increased 35 percent in the last quarter. Target's online sales grew by 42% and Walmart reported 37% digital growth. Online sales of Dick's Sporting Goods have increased by 15%. Best Buy's digital business in the United States grew 14.5%.
Investors rewarded this growth. Both Walmart and Lululemon shares hit a 52-week high on Thursday. Walmart's stock has increased 16% since the beginning of the year, while Lululemon's stock is up more than 42% since January. Starbucks is up nearly 30%, while Chipotle has gained 70% this year.
"Now it's easier in some ways to delay things," Sucharita Kodali, a retail analyst at Forrester Research, said in an interview.
The timing could be giving a boost to companies like Lululemon and Walmart. They did not have to "reinvent the wheel" online, she said, but instead they were able to adopt the "best practices" of other companies such as Amazon, which had started as an online bookstore in 1995. In the case of Walmart, this included the acquisition of start-ups like Jet.com that gave it a bench of young, experienced talents.
Meanwhile, what gives these retailers such dynamism online is something that Amazon can not match, at least these days: the physical stores. Traditional retailers are finally starting to offer services such as curbside shopping and online shopping, in-store collection, which is boosting online sales but also reducing shipping costs. society.
Lululemon, for example, spoke this quarter of the expansion of online store purchase options. About 150 of its about 440 The stores are now offering the service, the company said, and she plans to expand this option to all of her stores by the end of the third quarter.
Much of Target's online growth also comes from these services.
During the first quarter of fiscal 2019, Target stated that its same-day delivery service, with in-store, in-store and in-store pickup, had resulted in more than half of the 42% growth in its online sales and 25% of comparable stores. Sales in stores opened at least one year rose 4.8% over the period, exceeding estimates.
The financial benefit of all this for Target is that when customers pick up their items in the stores, the retailer is 90% cheaper than when it has to ship something from a warehouse, the company said.
"Even today, more than 50% of our orders are delivered the next day, so the stores and their proximity are used in our overall strategy," said Target's CEO Brian Cornell last month. . "We believe that we are so close to the customer … and convenience is an integral part of our strategy."
For Walmart, much of his recent online efforts have focused on groceries. The retailer plans to have 1,600 stores equipped for grocery delivery and 3,100 centers for grocery shopping in person by the end of the year. It is said that 90% of the American population lives within 10 miles of at least one of its stores.
"Clearly, we think our stores are a competitive advantage," Walmart Chief Financial Officer Michael Dastugue told a conference organized by UBS in March.
Walmart, Target, Home Depot, Best Buy, Macy's, Dick's Sporting Goods, Kohl's, are today the best "omnichannel" retailers in the country. , Nordstrom, Lowe's and JC Penney, and in that order, according to a study by Internet Retailer.
Retailers allowed buyers to return their orders online to a store, indicated the state of store inventory on the Web, in-store offerings with matching online promotions and even free Wi-Fi. store.
"Retailers who do not make omnichannel a priority are doing so at their own peril because buyers are demanding these services," the report says. 78% of buyers check online inventory for a certain store before returning and 68% of buyers say they will do more in 2019, according to the firm that surveyed 1,100 consumers .
The online shops of many restaurants have also rebounded.
According to The NPD Group, digital restaurant orders have increased 23% over the last four years – and they are expected to continue to grow. Digital sales generally generate higher average controls for restaurants. Domino & # 39; s Pizza, which sees two-thirds of its orders go digital, has reaped the benefits of its early adoption.
Mobile applications account for 60% of all digital orders, the NPD group said. Some restaurants, such as Starbucks, encourage customers to order via an app via loyalty programs. About 40% of Starbucks transactions come from loyal members.
Starbucks said that mobile phone orders had hurt sales after creating bottlenecks at the collection line, but the company has since solved these problems.
Convenience is certainly a propelling factor for digital restaurant orders. Digital sales of Chipotle Mexican Grill accounted for 15.7% of sales in the last quarter and doubled compared to last year. To facilitate the process, the burrito manufacturer has invested in digital collection shelving and special traffic lanes for digital controls.
The boom in third-party delivery services has also played a role in increasing the number of digital restaurant orders. For once, Amazon played a relatively modest role in this trend, overtaken by first-comers like GrubHub, DoorDash and UberEats. Most major restaurant chains have partnered with at least one delivery platform to bring their food to customers' doors. But earlier this week, Amazon announced it would stop service to focus on grocery delivery.
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