Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)
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A U G U S T 2 0 1 6 / S C T 21 The company opened its first And That bargain store, in Kennesaw, Ga., last month and is pleased with the 32,000-square- foot, freestanding store's p e r f o r m a n c e . " W e d e - signed this store to have local appeal, with an ever- changing mix of differen- tiated merchandise and opportunistic purchases, spanning categories such as home decor, seasonal, food, wine and beer, enter- taining essentials, and gifts, all at a great value," Tama- res said. "Early reviews have been outstanding." The company closed the first quarter with some $645,000 million in cash on hand and is projecting that same-store sales will grow by 1 percent this year. The chain plans to open about 30 stores this year across all its banners, said Tamares, mainly in new markets. Bed Bath & Beyond's famous 20-percent-off cou- pon continues to draw traffic, but those coupons are being used ever more frequently by the consumer and at the expense of the retailer's bottom-line profits, according to Seth Golden, chief market strategist at re- search firm Capital Ladders Advisory Group. "Volume increases have not come alongside the increased level of couponing to the degree that the discounting doesn't affect the overall business performance," he wrote in a report. "As such, Bed Bath & Beyond has to figure out a way to increase volume for store traffic and sales." More-pervasive forms of advertising might be in or- der, he says. "It may be time that Bed Bath & Beyond competes on equal footing with the likes of Target, J.C. Penney, Wal-Mart, Macy's and others with televi- sion commercial ads," he wrote. A rewards program would be another useful tool, Golden says. To that end, Alliance Data Systems Corp. and Bed Bath & Be- yond recently signed a deal to develop a co-brand credit card program. Golden also expects the retailer to pursue more digital-marketing efforts to reverse the trend. Its recent acquisition of pop- ular home-decor website One Kings Lane fits into that strategy. The site and its two design studios in New York City and San Francisco work directly w i t h h o m e - f u r n i s h i n g s brands, vintage dealers, designers and tastemakers to offer the site's members a curated merchandise as- sortment. "They communicate to the customer tremendously well," Tamares said. "Their customer really goes to that site and really looks at it multiple times a day, the type of thing that you sit do- ing on your lap with your iPad at the end of the night before you go to sleep and you play with it." One Kings Lane will serve as a cornerstone for Bed Bath & Beyond's grow- ing offerings in furniture and home decor to enable the chain to serve its cus- tomers through a variety of channels, Tamares says. "Over time, we believe this relationship will pro- vide us an opportunity to enhance our gift registry services as well as increase the overall experiential envi- ronment of the services and solutions we offer through their design services and stu- dio locations." S C T PRIMARK COMPETES ON PRICE Merchandise at U.S. retailers is priced at more than a 200 percent pre- mium over that at Primark, according to a Morgan Stanley survey. "Primark's low price points could act as a dis- ruptive force in U.S. retail, in our view," the report says. The U.K. discounter now has eight stores in the U.S., with plans for many more. Old Navy, Forever 21 and other teen- apparel retailers are Primark's primary competitors, the re- port says. The Irish retailer opened its fourth U.S. store, a 50,000-square-foot unit at Freehold (N.J.) Raceway Mall, last month. It may be time that Bed Bath & Beyond competes on equal footing with the likes of Target, J.C. Penney, Wal- mart, Macy's and others with television com- mercial ads