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Retail Holiday Sales Rise, But 2017 Won’t Be Rosy For All

AdAge

By: Adrianne Pasquarelli

Don’t be fooled by rosy retail holiday sales reports. It’s true that the sector finished well, but not everyone benefited—e-commerce was hot and there were pockets of strength among retailers like Gap and American Eagle. But the performance of department stores was weak, and some analysts are predicting multiple bankruptcies in the specialty sector by the end of the year.

Buoyed by factors like the seasonally crisp weather and positive marketing messaging among retailers, early indications were vigorous. Research firm Customer Growth Partners upgraded its forecast to a 4.9% gain in sales to $637 billion for the period from its earlier expected 4.1% rise. Online sales generated $91.7 billion, an 11% increase over the 2015 holiday season, according to Adobe, which said that 57 out of 61 days in the period resulted in over $1 billion in e-commerce sales. Final results from the National Retail Federation, which had expected an increase of 3.6%, are expected this week.

Those poor results came despite factors like the weather, which cooperated this season. Unlike last winter’s unseasonable warmth, which sent retailers of cold weather apparel into a downward sales spiral, December 2016 was actually cold. The chillier temps in eastern states benefited apparel stores by an estimated $309 million compared with last year, according to Planalytics, which provides weather analytics for businesses.

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