Holiday Stakes Never Higher for Retailers
While most kick back and relax for the holidays, retailers are locked in a no-holds-barred push to land in the black for the year.
Amazon, obviously, will have no problem navigating the tribulations of holiday season retail.
But a story no one is talking about this year is Best Buy’s (NYSE: BBY) big turnaround.
Yes, really. Best Buy.
With a strong holiday season Best Buy could re-establish itself as a go to brick and mortar destination that also has solid ecommerce. Kind of like a Walmart for big ticket items.
Since January 2016 the stock has more than doubled in value. Check out the chart below:
What’s the secret behind BBY’s amazing turnaround?
Simply put, they decided to take Amazon square on.
BBY drastically upgraded their website and app, as well as web/in-store omnichannel services such as online ordering with in store pick-ups.
BBY now competes with Amazon Prime’s 2-day shipping guarantee. All without the $99 fee.
The company also addressed one of the biggest challenges to brick and mortar retailers in an effort to stave off Amazon’s expanding influence.
A phenomenon called “showroom shopping”.
“Showroom shopping” is when consumers assess a product at brick and mortar stores, but purchasing them online for better deals.
By increasing in store inventory, BBY drastically reduced the amount of “showroom shoppers” at their stores.
They’ve essentially converted stores into dual functioning show rooms and inventory warehouses. But wait, it gets better.
According to the Wall Street Journal, BBY’s average price per product in September was just a scant 0.6% more than the Amazon’s prices for the same product bundles.
Will BBY continue to thrive?
Time will tell, but BBY’s certainly headed in the right direction. And a positive earnings report post holiday season could be a big boost for the stock moving into 2018.
Checking in on the markets this morning…
Market Rundown for Wed., December 20
S&P 500 futures are up 7.75 this morning at 2,691.
Oil’s flat at $57.75.
Gold’s up $4.70 at $1,268.
Bitcoin WENT DOWN! $17,450 this morning. Sound the alarm bells!
Finally today, regarding our recent mention of unusual options activity for Twitter (NYSE: TWTR), specifically January 2018 Call options:
Evidently the “cause” was Lloyd Blankfein, according to CNN Money, Tweeting about possible TWTR takeover rumors.
Markets buzzed, options activity increased. The rumor mill swirled. Anything to it? Probably not.
Talk with you again on Friday.
For the Rundown,