NEW YORK (TheStreet) - Given the terrible earnings results this quarter by teen retailers including Abercrombie & Fitch (ANF), American Eagle Outfitters (AEO) and Aeropostale (ARO) and cautious outlooks for the rest of the year, the argument that retailers need to get their acts together when it comes to digital and mobile shopping continues to burn brightly. It's not clear however, these companies are taking big enough steps.
Retailers across the board blamed poor mall traffic and highly promotional environments from competitors for disappointing earnings during the second quarter. The teen retail sector particularly suffered during the quarter as their demographic shored up spending, mainly for things that weren't apparel.
Aeropostale, for one, plans to "accelerate" store closings to 30-40 this year. American Eagle and Abercrombie already warned that it expects third-quarter sales to fall and both declined to give guidance beyond the October-ending quarter.
However, of the three companies mentioned, all saw double-digit increases in sales from their direct-to-consumer businesses - essentially their e-commerce businesses, though it's still a small portion of total sales.Also see: Wal-Mart Disappoints on Earnings, Kohl's Profit Slips Also see: A Tale of Two Retailers Also see: Abercrombie & Fitch Plunges on Weak Earnings, Cautious Outlook In today's digital and mobile landscape, there are definitely retail winners and losers, with many that are playing catch up. Coffee giant Starbucks (SBUX) is seen as a winner, while J.C. Penney (JCP) is a latecomer. While it's true that teens have less money to spend these days, if retailers don't want to become dinosaurs, getting on the digital and mobile bandwagon should be priority. A U.K. study following a group of 10- to 15-year-olds over a period of five years may have big implications for how big and small retailers, on both sides of the Atlantic, strategize the future business of shopping. According to the results of the latest Amaze Generation report released on Friday, three quarters of the study group expressed a "clear preference" for shopping online vs. in stores, "offering a bleak vision of the future of the high street and very rational view towards store closures," as well as the very real threat of so-called showrooming, where consumers enter stores to view products in person, but ultimately make purchases online. Commencing in 2011, the five-year research study looks at the impact of technology on the behavior and attitudes of consumers age 10 to 15. The latest report follows the third year of research by Amaze, a London-based marketing and consulting firm. The report found that youngsters see more choice in the digital space as a large benefit to shopping online along with the experience being easier and more convenient. Study participants "also see the potential to sell online through sites like 'eBay (EBAY) to buy cheap clothes and make money,'" the report says. The study also found "a clear, rational, unsympathetic view towards recent store closures with participants expressing views showing they have little loyalty towards traditional retailers." However, store for high fashion and luxury brands will remain, the group said. Youngsters studied by Amaze essentially said that a "core function" of high street stores - Main Street retailers in the U.S. - will be for showrooming. Social shopping is also increasingly becoming a key element to the purchasing experience. Two-thirds of the group has shared a "photo of items they were considering buying with friends and almost the entire group has done this while shopping online," the report says. Two-thirds of the group has also "shared a photo whilst shopping in-store." Interestingly enough, mobile has to still to emerge as a significant shopping channel for this group, the study found. Most prefer to make purchases from home (likely because of the need for permission from parents). "Whilst the use of mobile for shopping has yet to take hold with this generation, it will be extremely interesting to see how this develops given the overall increasing popularity of the device. This savvy, technologically connected age group are clear about what they want - ease of use, convenience and choice," says Amaze CEO Natalie Gross. "The process of shopping is changing forever and the trends we can observe from the group give us a unique insight into the future of online retail." -- Written by Laurie Kulikowski in New York. Follow @LKulikowski To contact Laurie Kulikowski, send an email to: Laurie.Kulikowski@thestreet.com. >To submit a news tip, email: firstname.lastname@example.org.
Follow TheStreet on Twitter and become a fan on Facebook.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV