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April Cruel Month For CE Retail Sales

5/23/2011 12:01:00 AM Eastern

NEW YORK – Bad weather, falling prices and Easter-
related spending kept a lid on CE and appliance
revenue last month, although e-tail sales told a different
story.

According to estimates from the U.S. Commerce
Department, April sales for electronics and appliance
retailers edged up just 0.9 percent year-overyear
to $8.4 billion, but fell 2.2 percent from March.

Within that channel, Conn’s said CE sales fell
4.5 percent for the first quarter ended April 30 on
a 20.5-percent decline in average TV selling prices
and weakness in PCs and digital imaging. Majap
revenue fell 7.5 percent on lower sales and pricing.

Broadline merchants reported similar downturns.
Sears Holdings said slumps in its majap and CE
businesses largely contributed to comp sale declines
of 5.2 percent at Sears and 1.6 percent at
Kmart for the three months ended April 30, while
Target cited CE as one of its weakest performers in
April. At Costco, CE comps fell by the low double
digits last month despite slightly higher TV unit volume
that was offset by lower prices. TV was also a
drag on BJ’s April sales, the wholesale club said.

Yet for e-tailers, CE was one of the top-performing
categories during the first quarter as more shoppers
continued to migrate online. According to estimates
by Internet market research firm comScore,
Web sales of CE, computers and peripherals, and
gaming hardware and software each grew at least
13 percent over the prior-year period, with only
books and magazines matching their sales pace.

Total e-commerce sales rose 12 percent, or
roughly twice the rate of brick-and-mortar sales, to
$38 billion for the quarter, comScore said, driven
by a 7 percent increase in the number of buyers
and a 9 percent increase in transactions per buyer,
which offset a slight decline in average transaction
amount.

The results represent the sixth consecutive quarter
of positive year-over-year growth for e-tailers
and the second consecutive quarter of double-digit
growth rates, the company said.

Estimates from comScore echoed Commerce
Department figures showing that e-commerce and
other direct sales rose 15.5 percent in April, while
Sears Holdings reported an increase in total online
sales of 22.4 percent during the quarter.

Gian Fulgoni, comScore chairman, attributed the
online sales spikes to “rapidly rising gas prices and
stubbornly high unemployment,” which are sending
consumers to the Web in search of lower prices.
“It’s clear that e-commerce has become a mainstay
in consumer behavior, driven by the attraction of
both lower prices and convenience,” he said.

But the National Retail Federation (NRF) warned
that the same factors could render recent retail
sales gains across all channels and product sectors
fleeting. “Positive economic indicators such
as increases in job openings and wage growth are
certainly helping boost consumers’ confidence and
support spending,” observed NRF Chief Economist
Jack Kleinhenz. “[But] plenty of other concerns exist
that could very easily shift consumers’ spending
habits, including decreasing home prices, high
unemployment levels and rising costs at the pump.”