IN AND OUT OF PRINT: Deutsche Bank has begun tracking, on a monthly basis, the amount and intensity of the year-over-year print advertising of Wal-Mart, Target, J.C. Penney, Kohl’s and Macy’s. Data is through Dec. 18, the week prior to Christmas. Charles Grom, the Deutsche Bank retail analyst who published the report, sees print advertising as another indicator of a retailer’s health. For example, the print involvement of department stores such as J.C. Penney, Kohl’s and Macy’s was “surprisingly low” in October, November and December — a peak period for circulars and newspaper “sale” ads. Double-digit declines in ad levels suggest an effort to drive expense savings, Grom said. Most aggressive during the holidays were Target and Wal-Mart, sharply increasing their advertising investment in December and duking it out on the printed page.

Target led the promotional way with a 47.1 percent increase and produced 7.5 circulars per market, compared with last year’s 5.1; however, the circulars had fewer pages. Increasing the number of inserts may have been part of an effort by Target to increase traffic, which has been weak, Grom said. If that was the rationale, it didn’t work: Target on Thursday reported a comparable-store sales increase of 1.6 percent, below Wall Street’s consensus of 3.3 percent, leading to a reduction in fourth-quarter earnings per share guidance.

This story first appeared in the January 6, 2012 issue of WWD. Subscribe Today.

Wal-Mart has been revving up its print advertising levels since June, with an average monthly increase of 54.6 percent. Wal-Mart is using the additional advertising, along with stockkeeping unit add-backs and layaway, to provide a one-time boost to its same-store sales in the fourth quarter, said Grom. Wal-Mart’s biggest increase in the amount of advertising was in October, when ad levels rose a whopping 300.9 percent. Next in line was Macy’s, which raised its levels in June by 100.7 percent. J.C. Penney’s print measurements showed the biggest year-over-year declines of the five retailers studied, falling every month since June, except for November, when the level rose 1 percent. Penney’s was less aggressive than some of its competitors during the holiday season, which could have been a factor in its same-store sales decline of 2 percent.

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