Apparel retail chain Nordstrom Inc.’s digital sales decreased 5% to approximately $1.13 billion in its fiscal second quarter ended Aug. 1, while total revenue dropped 51.9% to $1.86 billion during the quarter.
Nordstrom typically has its annual Anniversary Sale in July, but this year the company postponed the event to August because of store closures during the pandemic. Excluding the impact of the Anniversary Sale event shift, digital sales increased approximately 20% in Q2 and mid-teens range year-to-date, the retail chain says. Nordstrom did not report year-to-date ecommerce sales growth, but in Q1 it said digital sales grew 5%. That means web sales have been flat during its fiscal year thus far. Its Anniversary Sale performance will appear in its fiscal Q3 earnings results.
Digital sales accounted for 61% of total sales in Q2, up from 30% in Q2 2019. For the first six months of its fiscal year, ecommerce represented 57% of total sales, up from 31% in 2019. Total revenue is down 45.5% to $3.98 billion for the first half of the year.
Traffic to its site grew by double digits year over year in Q2 and was up compared with Q1, “indicating signs of increasing customer demand,” Nordstrom says. Additionally, for the second quarter in a row, the company had more than 50% growth in new Nordstrom customers through its website and app. Curbside pickup and returns represented a quarter of order pickup volume and 15% of ecommerce sales.
For the first time, Nordstrom allowed customers to preview its Anniversary Sale items online and create a wish list before the event began. “Our customers created nearly 20 million wish lists, which was not only a great way for them to engage early, but also allowed us to adjust in real-time to high-demand items,” CEO Erik Nordstrom said on a call discussing the results, according to a SeekingAlpha transcript.
In a Digital Commerce 360 and Bizrate Insights survey asking consumers about how they’ll shop online during the holidays last year, 25% of respondents said they planned to make or shop from a wish list on a retailer’s site. The survey was conducted in October 2019 with 1,055 U.S. online shoppers.
Ecommerce sales at apparel retailer Gap Inc. nearly doubled in Q2 and accounted for approximately half of total sales. Online sales jumped 95% in its fiscal second quarter ended Aug. 1 compared with Q2 2019, the company reported without providing exact figures for ecommerce sales. Its store sales decline of 48% offset digital growth and, as a result, net revenue declined 18.2% to $3.27 billion in Q2 compared with $4.00 billion in the prior-year Q2. Gap began reopening stores in May and, as of Aug. 1, 90% of its stores worldwide reopened.
Gap, which also owns the Old Navy, Banana Republic and Athleta brands, acquired 3.5 million new customers through its ecommerce sites during the second quarter, representing a 165% growth in new online customers year over year, the retailer says.
As online sales grew, gross margin declined 3.8 percentage points year over year as a result of increased shipping expenses with online orders. The company leveraged its stores to fulfill the strong online demand as well, executives said on a call discussing the results, according to a SeekingAlpha transcript.
Looking at year-over-year online sales growth of each of Gap’s brands: Old Navy’s ecommerce sales grew 136%; Gap’s (the brand) web sales grew 75%; Banana Republic’s digital sales were up 26%; and Athleta’s ecommerce sales were up 74%.
Apparel retailer Urban Outfitters reported double-digit growth in ecommerce sales in its fiscal Q2 ended July 31. The company did not provide more details on its digital business, but it did say that growth remains strong with double-digit growth in Q3, even as most of its stores have reopened.
Nordstrom is No. 18 in the Digital Commerce 360 Top 1000 ranking of the largest North American online retailers. Gap is No. 23 and Urban Outfitters is No. 34.
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