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Catalog Sales Drop But Online Efforts Grow

Catalogers didn't fare well during the holiday season as most of the big books saw sales fall. Some good news emerged, however, as online efforts continued to show tremendous growth.

Federated Department Stores Inc. was among those companies, as its direct-to-customer sales were down $104 million from the previous year while its online sales were up. Company officials said the downsizing of Fingerhut's core catalog is primarily responsible for the drop. Sales for Federated's DTC segment were $287 million, compared with $391 million the previous year. The results are based on a five-week compilation that ended Dec. 30.

Fingerhut reported its e-commerce operations saw a 40 percent increase. Carol Sanger, vice president of Federated's corporate communications in Cincinnati, said the company was pleased with Fingerhut's online performance, which exceeded the retailer's expectations. She would not reveal what company officials had expected or the amount of money generated by online sales.

JCPenney Co. Inc. announced a decrease of 3.9 percent in its catalog sales from the previous year. However, e-commerce sales, which are included in its catalog sales, were $65 million in December and $271 million year-to-date, compared with $36 million and $90 million, respectively, for last year.

Sears, Roebuck & Co. saw same-store sales drop during the holidays and announced the closing of 89 underperforming stores.

J. Jill was among the winners after announcing it expects fourth-quarter sales to be $87 million to $89 million. During the quarter, the company's e-commerce site, www.jjill.com, generated almost 20 percent of its direct-channel sales volume, which is a 115 percent increase over last year.

The Sharper Image saw its catalog sales rise 19 percent to $21.3 million from last year's $17.9 million. Internet sales increased 50 percent to $14.5 million from last year's $9.7 million.

For the Spiegel Group, Downers Grove, IL, fourth-quarter earnings fell in line with analysts' estimates. Total sales rose 4 percent to $537.5 million from $518.8 million a year ago. However, sales at its Eddie Bauer division fell 11 percent from a year ago.

Williams-Sonoma Inc., San Francisco, showed an increase for its holiday sales results covering eight weeks ending Dec. 24. Its DTC sales were $150.6 million, a 6 percent increase over the previous year. The Pottery Barn brand catalogs and three e-commerce sites are credited for boosting sales.

For Fingerhut, the holiday sales loss followed a less-than-stellar year for the catalog. In October, Federated said it would downsize the catalog and shift more attention to fingerhut.com. The news came after months of mounting losses resulting primarily from credit delinquencies. That same month, Federated also put $2.4 billion of Fingerhut's delinquent accounts up for auction to recoup some of its losses.

Federated bought Fingerhut, Minnetonka, MN, in March 1999 for $1.5 billion with hopes of enhancing its DTC sales business. Federated also assumed $200 million of the cataloger's debt, bringing the final cost to $1.7 billion.

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