Sales growth at specialty apparel stores slowed to a crawl in February as shoppers made fewer trips to the mall.
This story first appeared in the March 6, 2008 issue of WWD. Subscribe Today.
Sales in the channel grew 1.9 percent versus a year ago, to $5.29 billion, according to MasterCard SpendingPulse. In January, sales increased 5.4 percent.
Meanwhile, average prices in February slid 0.9 percent as shopping volume rose 2.9 percent, suggesting some degree of discounting, said Michael McNamara, vice president for research and analysis at MasterCard Advisors.
Women’s sales in the category dropped 0.2 percent for the month to $1.3 billion. Average price was down 2.3 percent as the number of purchases increased 2.2 percent — a state of affairs that no doubt will eat into stores’ first-quarter profit margins.
Part of the problem might be that higher gasoline prices are causing shoppers to think twice before turning the key and heading out to the mall. The gallons of gasoline pumped in February declined 3.2 percent versus a year earlier.
“People are cutting back on the number of trips they’re making,” said McNamara. “Generally, when you see gasoline pumping down that’s not a positive for the retail economy.”
Even those driving a Lexus or BMW, who might not worry so much about filling the tank, do seem to have thought twice when buying last month, a key time for luxe purchases that included Valentine’s Day.
Sales slid 2.2 percent to $3.35 billion in the luxury area after a 0.9 percent decline in January. Prices in the sector, which had been an island of strength, dipped 0.2 percent as shopping volume fell 2 percent. Luxury here includes high-end spending on leather goods and jewelry as well as in apparel specialty stores, department stores and restaurants.
“The fact that we’re seeing lower shopping volume and sales is kind of an indication that perhaps people are cutting back on some of these higher-end purchases,” said McNamara.
MasterCard sifts through data from its more than 300 million U.S. credit cards and adjusts for certain variables, such as new accounts, to create the spending overview, which is not indicative of the credit card company’s own performance.