In fairness, December was the best month in the history of retail, raking in a record $400.6 billion, seasonally adjusted, in December with only the second $400 billion month in history. However, this represented only a 0.1 percent increase over November of 2011, well below the 0.4 percent increase in November and the 0.3 percent many analysts were predicting according to a Bloomberg News survey. On the whole, 2011 was the biggest year for retail sales in American history, but the low numbers to finish the year have led to tempered enthusiasm from market watchers. December's numbers were the worst increase in seven months and, excluding the major gains in auto sales, they were the worst since May of 2010.
“When you look at the numbers, they’re pretty sad,” Howard Davidowitz of Davidowitz and Associates said. “The Gap (GPS) is in the tank. Kohl’s (KSS) is lousy. Cato (CATO) is down 1,300 stores. The American consumer is a train wreck.”
Brick and Mortar's Loss is Online's Gain
The news wasn't all bad, though, as online retailers substantially improved sales in the holiday season, continuing a gradual but undeniable march towards internet sales by consumers. “There are several factors at play here,”said IHS economist Chris Christopher. “More stores are offering e-commerce, and more people are getting used to buying online.” Online sales increased 13 percent year-over-year in December, and the total figure for last quarter hit $60 billion. Online sales still only constitute 5 percent of holiday retail sales, but that figure was at 1 percent just 10 years ago. “Clearly e-commerce and mobile is big,” said Davidowitz. “It’s going bananas, and will continue to.”
Target Announces Plans to Offer Apple Displays
In other retail news, Target (TGT) announced plans to open dedicated centers selling Apple (AAPL) products in 25 of its stores this year. Target already offers Apple products like the iPod and iPad, but the move to add specific Apple displays could mean big things for Apple's business, providing access to everyday shoppers with whom the brand has less penetration. “Target is a retailer that I don’t think has a large presence in tech, but it has a good presence in young suburban family shoppers,” Daniel Ernst, an analyst at Hudson Square Research in New York, told the Washington Post. “It’s the hip, big-box store. It makes a lot of sense and it will give Apple a bigger footprint.”
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