Sears has filed for bankruptcy and is closing stores. Here are the retail rivals that could benefit the most from its downward spiral.
- This would be welcome news for the struggling department store, which has been unprofitable for 16 out of the last 18 quarters and previously looked to capitalize on Sears' collapse by moving back into the appliances business after a 33-year hiatus.
- Taking into account the overlap of shoppers, those shoppers' income and age, and store proximity, Cowen found Walmart to be the greatest beneficiary of Sears' downfall.
- The Cowen data showed that 92% of Sears' shoppers also shop at Walmart and that there is considerable overlap between their shoppers in terms of age and household income.
- Moreover, Sears' bankruptcy has been a long time coming, as the department-store chain has been losing money and closing stores for years, which means that many stores have already been benefiting from its demise.
The future of artificial intelligence in retail
- Business Insider Intelligence projects that AI will boost profitability in retail and wholesale by nearly 60% by 2035, setting off a wave of excitement and investment among companies.
- The areas where AI will have its biggest impact are personalization, search and chatbots.
- Find out how AI is being implemented in these three areas and how each one can impact revenue in this new FREE slide deck from Business Insider Intelligence.
- In this third and final installment of the three-part Future of Retail 2018 series, Business Insider Intelligence takes a hard look at the retail use cases where AI can make an impact, explores noteworthy examples of retailers implementing the technology, and weighs the benefits of investing in AI today.
- As an added bonus, you will gain immediate access to our exclusive Business Insider Intelligence Daily newsletter.
Things are bad at Sears. They're worse at Kmart
- New York (CNN Business) - Sears is going to have a hard time surviving its bankruptcy.
- Traditional department stores, including Sears, face heavy competition from big box retailers and online competitors, namely Amazon (AMZN).
- Still, some department store chains — Macy's (M) and Kohl's (KSS), to name two — are profitable.
- Sears Holdings filed for bankruptcy last week.
- It was still a retailer in search of a profitable market niche when Eddie Lampert bought it out of bankruptcy in 2003.
- It claimed the segment of the market that big box stores would eventually dominate.
- Sports Authority and Borders eventually went out of business after their own bankruptcies.
- Kmart, losing to Walmart and other rivals offering good prices, filed for bankruptcy in 2002.
- It had 2,100 stores, or about three times what the combined Sears and Kmart have today.
How brands can benefit as voice streamlines product discovery, drives sales, and boosts customer loyalty
- Voice assistants offer an additional level of convenience and speed over other shopping channels, and these advantages are driving consumers to embrace the technology for their shopping needs.
- Today, 6% of US adults have engaged in some sort of voice shopping, according to Business Insider Intelligence estimates.
- As consumer interest for voice technology in retail mounts, brands that embrace voice throughout the entire customer journey stand to pull ahead of competition.
- Retailers that take advantage of consumers' desire to leverage voice will be in a stronger position to heighten customer engagement, increase conversion times, drive sales, and boost operational efficiency.
- In this report, Business Insider Intelligence examines the trends driving the adoption of voice commerce, details the role of voice throughout the customer shopping journey, outlines how brands can benefit from implementing voice in their strategies, and explores what's ahead for the tech in retail.
Here's what could happen to your Kenmore warranty now that Sears is in bankruptcy court
- Generally, consumers haven't had to worry about their warranties being dissolved in the wake of a company going out of business, according to Eric Arnum, editor of Warranty Week, which reports on the warranty industry.
- When Circuit City and CompUSA filed for bankruptcy, Arnum says, outside insurance companies stepped in, and all extended warranties were honored.
- About 20 percent of people who buy a major appliance buy an extended warranty or service contract, according to Consumer Reports.
- On the Sears website, which is still open for business, a customer has to place a specific refrigerator in the shopping cart before seeing the cost options for an extended warranty.
- For example, a recently issued auto service contract excludes brake drums and rotors, air bags, door handles, lock cylinders, the exhaust system and body panels, among other parts, according to Consumer Reports.
The challenges of last mile logistics & delivery technology solutions
- The costs and inefficiencies of the last mile problem have only been further compounded by the continuous rise of e-commerce in US retail sales, which has dramatically increased the number of parcels delivered each day, as well as raised customer expectations to include not just fast, but also free, delivery.
- And with the growing ubiquitousness of "free shipping," customers are less willing to foot a delivery fee, forcing retailers and logistics partners to shoulder the cost.
- The crowdsourcing model has been prevalent in transportation, hospitality, and food delivery for some time now, and retailers are eyeing its low startup costs, asset-light operations, and improved customer experience to ease their last mile delivery woes.
- With crowdsource technology, retailers, logistics partners, and consumers can connect directly with local, non-professional couriers who use their own transportation to make deliveries.
An algorithm kicks businesses out of food stamp program on dubious fraud charges
- But court testimony by a USDA official indicates that, just last year, hundreds of retailers were permanently disqualified from the program based primarily on an algorithmic assessment of their transaction patterns — the same circumstantial evidence that ensnared Mejia.
- According to a deposition given by Gilda Torres, a USDA section chief who oversees disqualifications, algorithm-flagged stores referred to her office for investigation are issued charge letters more than 95 percent of the time.
- According to documents posted to the USDA’s website, retailers send a wide variety of paperwork to prove their innocence: medical records that show transactions flagged as fraudulent happened while owners were taking care of a sick family member, proof that employees had been trained in SNAP policy, credit logs, and in some cases hundreds of pages of receipts and letters from customers.
Zero-waste stores pop up in the US, targeting shoppers tired of all the waste
- While this refill model, which emphasizes reducing packaging waste, has worked for specialty shops, larger grocery stores are trying to figure out how to successfully apply this model to a zero-waste design.
- At the grocery retail level, a commitment to zero waste means aggressively reducing food and/or packaging waste.
- Meanwhile, budding food entrepreneur Sarah Metz is hoping to open up the first zero-waste grocery store in Brooklyn, New York.
- While she has been learning the entrepreneurial ropes for the last four years and competed in business-plan competitions, once winning $5,000, she lacks a concrete timeline for completing the mission outlined on Kickstarter back in 2016: opening a physical zero-waste grocery store in Brooklyn.
A wave of senior departures, lost market share, and a 20% drop in fees: A dismal year in investment banking at Bank of America
- Investment banking was one of the few sore spots in an otherwise strong third-quarter earnings report for Bank of America Merrill Lynch.
- While overall profits in the third-quarter soared 32% to $7.2 billion, investment banking fees in the firm's Global Banking division dropped 20% to $643 million.
- JPMorgan Chase and Citigroup reported earnings Friday and saw smaller investment banking declines of 1% and 8% for the quarter, respectively.
- While investment banking comprises a much smaller slice of Bank of America's business than its powerhouse consumer retail division — which reported $3.1 billion in profits in the quarter — the firm is a perennial a top-three player on global dealmaking league tables.
- The firm's share in global investment banking fees dropped to 5.7% — down from 6% in 2016 and 2017 — while JPMorgan, Goldman Sachs and Morgan Stanley all posted gains.
The future of mobile commerce
- So bright that Business Insider Intelligence, Business Insider's premium research service, expects the industry to top $5.5 trillion by 2020!
- While in-store and desktop purchases are certainly helping the retail industry boom, the biggest factor for this incredible growth is in your pocket.
- Find out why the smartphone will be crucial for retailers in 2018 and beyond with the second part of a brand new slide deck from Business Insider Intelligence called The Future of Retail: Mobile Commerce.