Retail Earnings Recap: 3 Merch Strategies That Are Actually Working

My takeaways:

1. The strongest callout, by far, across multi-brand retailers, was the strength of private label, exclusive, or limited-distribution merchandise
2. Beauty is big -- for JCP/Sephora's "Modern American Mom", Urban's 20-something, and Nordstrom's Anniversary Sale shopper
3. Home showrooms, closely linked to a digital strategy, are exciting

JC Penney:

• "Private brands like Arizona, St. John's Bay, Liz Claiborne, Xersion, Stafford, and JCPenney Home played a key role in our ability to improve our results, grow our market share, and deliver a great value to our customers"
• "We'll leverage our tremendous sourcing and private brands infrastructure to become the most efficient retailer at producing a portfolio of private brands with style, quality, and value"
• "We saw strength in sheets, bath accessories, cookware, custom window, and furniture. We also continue to be very pleased with the excellent results of our appliance businesses... the early sales results in test stores (where all home initiatives are under one roof) have been excellent."
• Sephora was called out as an area of strength and there are plans to add Clinique and grow the number of shop-in-shops

Kohl's:

• This is one company that said national brand penetration increased approximately 200 bps in the quarter, which is consistent with their strategy
• They did note they need to revitalize their own Jumping Beans brand, so maybe its weakness drove down private label
• Kohl's also carries a number of exclusive diffusion lines of national brands, which likely are included in national brand sales

Macy's:

"Our private brands also helped fuel the quarter's improvement, particularly in women's apparel, shoes, and home."

Nordstrom:

• "Our efforts to grow relevant brands that have limited distribution play an important role in creating excitement, and attracting new customers. They now make up the majority of our top 20 fastest-growing vendors, and we're continuing to expand the most highly sought after brands like IVY PARK, Madewell and Charlotte Tilbury, with new partnerships to come."
• Beauty, along with shoes, was called out as a highlight of the recent Anniversary Sale

Target:

• "Within Signature, we saw particular strength in both kids and style. Results in kids reflected the launch of Cat & Jack which is now positioned to become our biggest owned brand. After the July rollout of this brand, we saw double-digit growth in Cat & Jack sales when measured against comparable sales of Circo and Cherokee last year."
• "Within Style, we continue to benefit from strength in women's apparel which saw a mid single-digit comp increase in the quarter. This performance was driven by double-digit growth in our Xhilaration brand which is focused on a younger style-savvy guest."
• "In addition, we're really pleased with the performance of Who What Wear, which is one of the most productive brands on our women's floor pad. As a result, we're expanding the size range of this assortment for the fall, inviting more of our guests to enjoy the items from this fashion-forward collaboration."

Urban Outfitters:

• "One of our biggest shifts in strategy across all merchandise categories has been our focus on exclusive product and offering our customer product he or she can't get anywhere but Urban Outfitters"
• "In addition, to our own brand product, which is 100% proprietary and a majority of the total assortment, we worked with key brand partners such as Adidas, Wrangler, and FILA, on special makeup, exclusive styles, and UO collaboration"
• "We're seeing sizeable growth and upside in our home division.... we launched a home showroom in Space 15 Twenty in Los Angeles, one of our large-format stores"
• Almost 90% of the women's product was proprietary in Q2