To help turn around Bed Bath & Beyond Inc.’s declining profits and slow growth, the retailer plans to expand its use of dynamic pricing technology, Bed Bath & Beyond Inc. CEO Steven Temares told Wall Street analysts last week.
The retailer already uses dynamic pricing—a strategy in which businesses set flexible prices based on current market demands—on the web and will be phasing it in across all channels over the next few years, he said, according to a Seeking Alpha transcript. It’s a move he expects will pay off in more revenue and improved profitability.
“We have been dynamically pricing our online-only assortments and, more recently, we have begun piloting dynamic pricing strategies in a limited number of stores and product categories,” Temares said. “As we gain more experience, we plan to roll it forward, expecting an impact on both volume and gross margin dollars.”
Temares said the retailer plans to adopt a pricing strategy that involves the use of “pricing specialists” in tandem with machine-learning technology. Temares’ comments follow his December announcement that the retailer planned to introduce dynamic pricing this year.
Beyond dynamic pricing, the retailer plans to “substantively and meaningfully differentiate” its merchandise assortment, improve customer service, as well as roll out a more personalized online experience, he said.
Bed Bath & Beyond ranks No. 68 in the Internet Retailer 2017 Top 500.
- Sales for the fiscal year 2017 (53 weeks) were $12.35 billion up 1.1% compared with $12.22 billion in fiscal 2016 (52 weeks).
- Net earnings of $424.9 million for the year (53 weeks), down 38.0% with $685.1 million the previous year (52 weeks).
- Comparable sales for the fiscal 2017 full year decreased by approximately 1.3%. That “included strong sales growth from the company’s customer-facing digital channels and sales from stores that declined in the mid-single-digit percentage range,” the retailer reported.
For the fourth quarter, Bed Bath & Beyond reported:
- Net sales for the quarter (14 weeks) increased 5.4% to $3.72 billion, from $3.53 billion for the year-ago quarter (13 weeks).
- Net earnings of $194.0 million, down 27,8% from $268.7 million in 2016’s fourth quarter.
- Comparable sales in the fiscal 2017 fourth quarter (14 weeks) decreased by approximately 0.6%. That included strong sales growth from the company’s digital channels, and sales from stores that declined in the mid-single-digit percentage range.
More earnings news
- United Kingdom-based apparel retailer ASOS PLC reported net sales of 1.58 billion pounds ($2.25 billion) in sales for the six months ended Feb. 28, up 27% from 911.50 pounds ($1.30 billion) for the same period a year earlier. Gross profit 569.40 pounds ($809.12 million), up 29% from the 440.1 pounds ($625.39 million) for the year-ago period.
- Germany’s Otto Group, a retail and services group, reported e-commerce revenue for the 2017/18 fiscal year (ended Feb. 28) were 7.76 billion euros ($9.6 billion) up 10.9% 7.0 billion euros ($8.67 billion) for the previous fiscal year. Total revenue for the 2017/2018 fiscal year ended Feb. 28 was 13.70 billion euros ($16.96 billion), up 9,6% from 12.51 billion euros ($15.49 billion) for the previous fiscal year.