Nordstrom (NYSE:JWN), Walmart (NYSE:WMT) and Kohl's (NYSE:KSS) have all reported big jumps in their e-commerce sales—well above the retail average—at the same time they're struggling to grow sales in-store.
Overall, U.S. retail e-commerce sales grew 18.4 percent in the past year, according to the U.S. Census Bureau. But Nordstrom's online sales jumped 37 percent, Walmart's rose 30 percent, and Kohl's climbed 28 percent. Of the three chains, only Kohl's saw same-store sales in its brick-and-mortar stores increase—it edged up 0.9 percent, better than a loss but not exactly healthy growth when overall retail sales is growing at 4.7 percent per year (again according to the Census Bureau).
What's going on here? According to the numbers, the big chains are doing much better than the average retailer online, but are capturing almost none of the growth in brick-and-mortar sales, where they'd be expected to have the biggest advantage.
For the biggest retailers, online growth is fine, but not enough in the short term because e-commerce still accounts for only 5.8 percent of U.S. retail sales. Store sales are losing ground faster than online is gaining ground for these big chains.
That may be a good sign for small retailers and regional chains if it means they're picking up the customer traffic that big chains aren't. (It also raises the question of whether shoppers have extended the idea of showrooming once again, this time using big chains to shop and decide, then buying at smaller retailers where they may be able to bargain.)
But it offers no clue for how large chains can keep delivering the growth that investors demand.
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