Reimagining Retail: The Unofficial Most Interesting Retailers List (September)

On today's podcast episode, we discuss the unofficial list of the most interesting retailers for the month of September. Each month, our analysts Arielle Feger, Becky Schilling, and Sara Lebow (aka The Committee) put together a very unofficial list of the top eight retailers they're watching based on which are making the most interesting moves: Who's launching new initiatives? Which partnerships are moving the needle? Which standout marketing campaigns are being created? In this month's episode, Committee members Arielle Feger and Sara Lebow will defend their list against analysts Zak Stambor and Rachel Wolff, who will dispute the power rankings by attempting to move retailers up, down, on, or off the list.

Subscribe to the “Behind the Numbers” podcast on Apple Podcasts, Spotify, Pandora, Stitcher, YouTube, Podbean or wherever you listen to podcasts. Follow us on Instagram

Episode Transcript:

Sara Lebow (00:00):

EMARKETER Field Guides help marketers understand how key MarTech, AdTech and CommerceTech tools are changing so they can make smarter purchasing decisions. Sponsor one today to ensure your solution is top of mind for buyers. Visit emarketer.com/advertise to learn more.

(00:19):

Hello, listeners. Today is Wednesday, September 25th. Welcome to Behind the Numbers: Reimagining Retail, an EMARKETER podcast. This is the show where we talk about how retail collides with every part of our lives. I'm your host, Sara Lebow. Today's episode topic is our September Unofficial Most Interesting Retailers of the Month List.

MUSIC (00:44):

(Instrumental music)

Sara Lebow (00:47):

Before we jump into our top eight for September, let's meet today's guests. Joining me for today's episode, we have fellow committee member and Retail Podcast regular Arielle Feger. Hi, Arielle.

Arielle Feger (00:58):

Hi. Happy to be here.

Sara Lebow (01:00):

Happy to have you. Also happy to have with us another podcast regular, Zak Stambor. Welcome back, Zak.

Zak Stambor (01:06):

Yeah, thanks for having me back.

Sara Lebow (01:08):

And joining us on the podcast for the first time is our analyst, Rachel Wolff. Welcome to the podcast.

Rachel Wolff (01:14):

Thanks for having me.

Sara Lebow (01:15):

So excited to have you. Okay, let's jump in to our Unofficial Most Interesting Retailers of September List.

MUSIC (01:22):

(Instrumental music)

Sara Lebow (01:28):

Arielle, our colleague, Becky, and I make up the committee and we put together this list every month. So if you've listened before, you know the deal. These are the eight retailers we're watching because they're the most interesting. They're launching new initiatives, partnerships, over-performing in earnings, they have notable social media buzz. You name it. This list is hyper-subjective, but it is supported with objective analysis. Arielle and I will present our list in the first half of the episode. And in the second half, Rachel and Zak will have opportunity to tell us where we went wrong. Okay, let's get started with number eight: JCPenney for launching an apparel line for women who use wheelchairs. "These items are designed with zippers, pockets, fabrics, and waistband loops to be comfortable and functional for seated wearers," according to a press release. This is one of a few brands that have had similar accessible or adaptable lines come out recently. So it's not the most interesting thing, but I still think it's a decent move by JCPenney.

Arielle Feger (02:27):

Yeah, I think it's an interesting move. I think anytime where we have retailers being inclusive, I am definitely in support. I do wonder. JCPenney is trying to mount a comeback, so I applaud any kind of way it's trying to differentiate itself from other department stores or retailers.

Sara Lebow (02:47):

Okay. Moving on from that, number seven: J.Crew for reintroducing its physical catalog. Arielle, say more on this.

Arielle Feger (02:56):

Yeah. So as a child of the '90s, I definitely loved a catalog, loved to look through it, and I think it's really interesting that J.Crew is bringing this back. The catalog was discontinued in 2017 and I think what they're trying to do is bring it back, but with a more modern take. It's going to be designed to be less product-centered and more content, interviews. I think in the inaugural issue, they've got an interview with Demi Moore on her collection, and it's going to have some QR codes that shoppers can use to shop on their phones. So I think it's just a really interesting thing to bring back something of the past, but update it. And I think a lot of people are looking for inspiration, so this is a great way to get that inspiration on paper instead of online.

Zak Stambor (03:48):

I totally agree. I love this move. I think at a time when we're just bombarded with digital stuff, digital content everywhere, having a physical object ... And this physical object is on thicker paper stock. It's got really vivid, beautiful images. It's designed to stick around and sit on your coffee table, and that's pretty valuable if you can get people to just look at this and think of J.Crew all the time or whenever you're sitting down on your couch.

Sara Lebow (04:27):

That's a good point. When I say clothing catalog, what brand do you think of?

Rachel Wolff (04:31):

I mean, for me, J.Crew definitely is the first one that comes to mind.

Arielle Feger (04:34):

So it's a good move.

Rachel Wolff (04:35):

Yeah, I've noticed that I've been getting more catalogs from brands in the mail, so I think this could be, I guess, the tip of the iceberg in a way. I'm pretty sure that a lot of companies will be following suit.

Sara Lebow (04:46):

I think of Land's End. I think of back to school circling the Land's End catalog.

Arielle Feger (04:50):

I think of Delia's.

Sara Lebow (04:52):

That makes sense too.

Arielle Feger (04:53):

I wanted everything in the Delia's catalog.

Sara Lebow (04:56):

All right. Number six: Levi's, which is launching a mobile tool for its in-store stylists. The app's purpose is to offer personalized recommendations which will sync up with a customer's loyalty account. That's if they opt in. So it's sort of a clienteling tool. It's a tool for Levi's employees to better be able to serve their consumers in the store in a way that will hopefully also help them out of the store in e-commerce.

Zak Stambor (05:25):

I think this is a really smart way to empower store associates in a way that actually enables them to know who it is that they're speaking to. Because so often, you go into a store, you say one thing about what it is that you're looking for. And the associate doesn't really know anything about you. It may be completely irrelevant what they show you. This enables them to really hone in on what it is that you're likely to want.

Sara Lebow (05:55):

It's the tool that prevents from doing a Julia Roberts in Pretty Woman moment because you know who that customer is.

Rachel Wolff (06:03):

Yeah, and I think it fits in really well with their long-term ambitions, which is that they want people to go in for more than just a pair of jeans.

Sara Lebow (06:10):

Yeah.

Rachel Wolff (06:10):

So then you have this stylist who says, "Oh, this top will look great with that pair," or, "This dress, this denim dress," not like the one I'm wearing now. But I think that it fits in really well with their long-term ambitions.

Sara Lebow (06:22):

That's a great point. Okay, number five: Old Navy for launching a vintage fashion line. Wow, we're doing a lot of these vintage brands. Arielle, say more.

Arielle Feger (06:31):

I know, I was just going to say we've really hit nostalgia a lot.

Sara Lebow (06:36):

Thinking of a lot of places where I can go buy jeans.

Arielle Feger (06:39):

Yeah, so Old Navy, they're celebrating their 30th anniversary as a brand. And to celebrate that, they're kind of doing this whole campaign centered around a throwback line of clothing that's kind of Old Navy reimagined classics with a modern twist. I just think it's really fun. I think Old Navy's heyday was certainly back maybe in the '90s and early 2000s, so I don't think it's a bad move to try to recapture some of that spirit. And I think this is just, again, we've talked on the pod before about Zac Posen, who was appointed creative director of Gap, Inc., and I just think it's all part of their turnaround plans and I think it seems to be kind of working.

Rachel Wolff (07:25):

I think it's interesting, but I also wonder. Everybody's doing '90s themed stuff these days, so I wonder if that's really going to be the thing that makes Old Navy stand out from the crowd. I mean, that being said, I do think that it'll help with their overall turnaround and Gap's broader reinvention.

Sara Lebow (07:43):

The clothes look to me like a '90s Tommy Hilfiger or a '90s Ralph Lauren. Maybe I'm off base here, but I don't think I am. It has this sort of Americana feel as well. It feels on the pulse, but you're right. The fact that I'm even saying that it's reminiscent of other brands does mean that it's a crowded space. Okay, number four: H&M, which is launching dedicated beauty shops alongside its flagship stores. H&M has already done this in Oslo, but that's been a success so they're expanding to two other stores in Stockholm. Ultimately, that's still a pretty small space, but I wouldn't be surprised if H&M kept doing this. I think it's a huge vote of confidence for beauty, which we've talked about before how successful beauty has been as a category, and I think it's a smart move from H&M since their beauty is known for being affordable.

Arielle Feger (08:38):

Absolutely. I think about Kohl's and their Sephora shop-in-shops. I think it's just a great way to kind of get people to spend a little bit more, to shop a little bit more, to hang around the store a little bit more. And it makes sense in terms of the actual categories, beauty, clothing. It all kind of pulls together.

Rachel Wolff (09:01):

But I think going on that Kohl's/Sephora, well, that you mentioned, I think that's also a risk for them, which is that people will just go in and pick up a Mac lipstick and then walk out without having bought anything from H&M. So I think they have to find a balance there.

Sara Lebow (09:14):

Yeah, it's usually the clothes that get customers to come into H&M and then they pick up the lipstick on the way out. This is going for the opposite, trying to get folks to come in for the lipstick and getting them to go in next door and grab those clothes as well. Okay, number three: Big Lots, which despite declaring bankruptcy this month also announced a new holiday sale. Arielle, what is happening here?

Arielle Feger (09:36):

Yeah, Big Lots is having an interesting month. So yeah, they did announce chapter 11 bankruptcy and that's not something that we should sweep to the side, but I do think it's really interesting that right on the heels of that, they announced this Black Friday weekly sales event. So every Thursday, they're going to announce a special deal that customers can shop on Fridays and that's going to take place every Friday, now through December. I think it might be kind of a last grasp at something, but I just think at least they're going down swinging if they're going to go down.

Zak Stambor (10:15):

Yeah. I don't know, man. A month where you declare bankruptcy doesn't seem like the month to be on the list of the most interesting retailers. I understand the push to pull the holiday season forward even into September, which seems kind of crazy to me, but they're not alone in doing that. I mean, Best Buy is also launching their holiday sale for members of their paid membership programs at the very end of this month. I don't know. It doesn't strike me as super interesting. And given that they declared bankruptcy, I don't know.

Arielle Feger (10:59):

Fair point.

Sara Lebow (11:00):

Yeah. Is it one deal per week? Is that the idea?

Arielle Feger (11:04):

Yes, I believe so.

Sara Lebow (11:05):

Where it's just a one-day deal? That's kind of interesting to me.

Zak Stambor (11:08):

It's a one-day themed array of deals, isn't it?

Arielle Feger (11:12):

Oh. Good question.

Sara Lebow (11:14):

Well, so that is interesting to me. Cutting down on choice is interesting to me. I've been looking at the site called meh.com, which offers one deal on one product per day. I think consumers are interested in being told what the one thing is that they can get a deal on and that's kind of fascinating, but yeah. I mean, fair point, Zak, and I think you'll get your chance to duke that one out in the second half.

Zak Stambor (11:38):

Yeah. We'll revisit this one.

Sara Lebow (11:40):

Number two: Amazon, we're into the big guy here, for adding ads to its AI search bot, Rufus, and for opening some new Fresh supermarkets. So let's break this up. The ads, that's interesting. They sort of quietly added ads to its chatbot. This is something we're looking at a lot on our marketing side. That's a plug for our EMARKETER Daily newsletter if you're not signed up. But yeah, this is a place that we're going to be seeing ads more and more often, and so I'm engaged in how Amazon is going to monetize this tool. Fresh supermarkets are fascinating because Amazon closed several of these last year, and now they're leaning back into it. Grocery in person is not something that Amazon's been able to get right. Clearly, if they're opening these supermarkets, they have money to burn on trying to get it right so fascinated to see if this actually works this time.

Zak Stambor (12:32):

The Rufus ads, I think, are tremendously interesting. I mean, Gen AI and chatbots is just not a space that we've seen ads yet. And to see Amazon waste really no time at all weaving ads into it, I think, is very notable and a clear sign that they see this as the way in which consumers are going to shop Amazon going forward.

Sara Lebow (12:57):

Yeah. This happened during a week where Perplexity also announced ads in its search bot. Perplexity is a Gen AI search tool, but it has a much smaller user base than Amazon. It's kind of like a start-up-y search tool. Google has also been putting ads into its AI summaries, but it's sort of unclear what its strategy is there, if it's just moving ads higher or not. Amazon seems to suddenly have its finger on the AI pulse and I think it was kind of behind for the last year.

Arielle Feger (13:28):

Yeah, absolutely. I think it's really interesting to see them after seemingly stalling for a bit on what directions and how they wanted to really make a mark in the space to have them do this.

Sara Lebow (13:40):

Okay, and our number one retailer. Number one: Walmart for opening a sneaker marketplace, which we talked about during our marketplace episode so check that out if you haven't, and for making its New York Fashion Week debut. Arielle, say more.

Arielle Feger (13:57):

Is it a retail ranking without Walmart? Yeah, so they're just really pushing fashion in all sorts of directions. They were at Fashion Week. Not the brand you would expect to see, but they did a pop-up with designer Brandon Maxwell, who works with them on two of their private label apparel lines. They're launching a style tour kind of an event across the country with curated styles and fashion tips. And then, again, they're doing a partnership with resale site StockX on sneakers. So they're really kind of doing a lot on fashion and I just think it's a smart move considering it's got the grocery market pretty well cornered. This is a way for it to get people shopping for other items while they're in stores and getting them to buy just trendy products for less money.

Rachel Wolff (14:49):

I think it's super interesting. I do think that it will take more for them to be known as a fashion destination though. I mean, Brandon Maxwell, I guess he's known if you're super into fashion, but he's not a big name the same way that Zac Posen is for Gap, for example.

Arielle Feger (15:03):

Yeah.

Sara Lebow (15:03):

Yeah, that's a good point.

Zak Stambor (15:05):

Yeah, I totally agree. I think if Walmart, whose reputation is very much set in stone for many, many consumers, is going to actually make big inroads into the space, they need to be doing these sorts of things. They need to be doing a whole lot of everything.

Sara Lebow (15:22):

Yeah.

Zak Stambor (15:23):

Because otherwise, people are just not going to associate this brand, that forever they have thought of as just a place for low-cost stuff, as a place to buy fashionable items.

Sara Lebow (15:35):

Yeah. I mean, Walmart has the money to take these kinds of risks. Every time we put this list together, Arielle, Becky, and I are like, "We don't want to put Amazon and Walmart at the top. They're always at the top. They're always on the list." But the truth is because of their flywheels, they just have money to take from other parts of their business and invest in these parts that aren't necessarily earning as much money. So they can succeed, or at least they can probably fund succeeding if they do it right, but it's hard to change your image.

(16:08):

Okay, so that completes our list overview. Just to recap, we have number eight, JCPenney, number seven, J.Crew, number six, Levi's, number five, Old Navy, number four, H&M, number three, Big Lots, number two, Amazon, and number one, Walmart. As usual. We have a nine and 10 that didn't make the list. They're our honorable mentions. At nine, we had Thrive Market, which opened a retail media network in partnership with Instacart. And at 10, we had another bankrupt business, Bed Bath and Beyond, which launched a global licensing program for its brand. That was our first half. Now it is time for our second half.

MUSIC (16:52):

(Instrumental music)

Sara Lebow (16:56):

This is where Rachel and Zak will get to tell us where we went wrong. Each of them will have a chance to move a brand up or down our rankings list and to add a new company entirely. So Zak, why don't you go first and make a move?

Zak Stambor (17:09):

Yeah, I'm going to yank Big Lots right out of there, right out of that number three slot. I just think if you have filed for bankruptcy in a month, you shouldn't be on a list of most interesting retailers. And while I think it's notable that they are seeking to pull the holiday season into September, there are other retailers, notably Best Buy, who are also doing that and likely to find more success with it.

Sara Lebow (17:41):

And Best Buy is doing it with a hologram, so there's that.

Arielle Feger (17:46):

But you're right. I mean, it's not a particularly new thing for Big Lots to be doing holiday sales ahead of the "traditional" peak holiday season, so I'll allow the move.

Sara Lebow (18:01):

Zak, would you yank Big Lots to number eight or would you yank them all the way off and have Thrive move into that number eight position?

Zak Stambor (18:10):

I want to pull it all the way off and save a spot for my retailer.

Sara Lebow (18:14):

Okay, we'll do that for now. Every time we do this, we come up with new rules for how it kind of functions. Rachel, what is your move? We accepted Zak's. What's your move?

Rachel Wolff (18:29):

Okay, so I'm going to go back to Old Navy and I'm going to push them down the list a little bit. As we said, I think that it's an interesting move. It's definitely of the moment to play into this '90s nostalgia, but I don't think that it's particularly unique. And I think that in the grand scheme of things for Old Navy and for Gap overall, it's not necessarily going to move the needle that much. So yeah, that's my move.

Sara Lebow (18:53):

If Old Navy's moves down, that means Levi's, J.Crew, JCPenney would move up. Do we think that they deserve that?

Rachel Wolff (19:03):

I think that J.Crew definitely does. I mean if you're talking about turnarounds, J.Crew is another brand that has done, I think, pretty well over the past year or so in just getting to that point where they're the IT brand again. So I think that for the time being, in terms of interest level, I would say that yes, it would go below the app and the catalog, maybe above JCPenney.

Arielle Feger (19:27):

I could be amenable to that. I definitely think that it's still interesting. I'm still interested, but I think maybe it's not as interesting as the Levi's or the J.Crew.

Sara Lebow (19:41):

Yeah, I'm not moving it below JCPenney because JCPenney is also doing something that's part of a greater trend, but I would move it below Levi's and J.Crew. I also am interested in how much this Americana push will work now that the Olympics and 4th of July season/summer are over. That's when people buy their Old Navy American flag shirts. Obviously, the election is coming up and we've seen both sides leaning into this Americana vibe, but I don't know if that will inspire people to shop. Okay. We've pushed Big Lots off the list. We've pushed Old Navy down a few spots. We've been really amenable. I don't know if we're going to be as amenable. I don't know if we'll be as amenable.

Zak Stambor (20:28):

I think we might.

Arielle Feger (20:28):

I don't know.

Sara Lebow (20:29):

Let's see what you've got for us. Rachel, why don't you go first? What's your wild card and where do you want to put it?

Rachel Wolff (20:34):

Sure. So my wild card is Zara and I think I would put Zara pretty high on the list. I would say maybe above Levi's, where it is on the current ranking, and that's for a few reasons. One is just that they're doing really well. Their sales are up something like 11% in the five weeks up until the beginning of September, so people are really responding to their new collections. And they're also doing really interesting things to get new shoppers. They're going to start launching livestreams in a couple of weeks. They're launching a resale platform in the US in October. So I think overall, they're doing a really great job at reaching consumers, attracting consumers, and pushing the envelope in bringing new people into the fold.

Sara Lebow (21:16):

Yeah.

Arielle Feger (21:20):

You don't sound convinced.

Sara Lebow (21:21):

Zara, to me, is just another H&M. Although, I guess H&M is another Zara. I could be convinced to add it to the list, especially above JCPenney, which none of us have been super bullish on, but I don't know that I would put it that high. I mean, Levi's app feels more new and different than what Zara is doing. Same with J.Crew's catalog. I would put Zara a bit lower.

Arielle Feger (21:49):

Yeah, I think I'm okay with adding into the list, but I might put it lower. I'm most interested in the live shopping part of things. I'm super curious to see where that goes in the next year or so as people start to dip their toes into it. The resale thing, meh. Everyone's doing that. But yeah, I think I would be okay putting it ... Poor JCPenney. We're putting everything above it. But that's where I would put it is maybe above JCPenney, or maybe Levi's.

Rachel Wolff (22:23):

Fair enough. I'll take that.

Sara Lebow (22:24):

Okay, we'll put it above JCPenney. That kicks JCPenney down to our honorable mentions section. Sorry, JCPenney. Zak, what's your wild card?

Zak Stambor (22:34):

Dick's Sporting Goods really crushed it in Q2.

Sara Lebow (22:37):

What did they do?

Zak Stambor (22:39):

They beat analysts' top and bottom line expectations. Comparable sales, I think they fold in online. Comparable sales rose 4.5%. That's up from 2% a year earlier, well ahead of the expectations. And what's interesting is that they're thriving at a time when a whole lot of athletic brands are struggling, whether you're talking about Lululemon or Nike or Under Armour for sure. And it just goes to show that they have a really solid game plan that they're executing really well and they're doing it in a few different ways. They have built out a pretty solid private label apparel brand portfolio and they've also brought in really strong brands, like Hoka and On Running. And so they're just executing extremely well at a time when the category as a whole is in somewhat of a tough spot.

Sara Lebow (23:44):

Didn't they lower their outlook for Q3, or am I making that up?

Zak Stambor (23:49):

They did. It's still decent, but I think that reflects the broader retail environment. I think just about every retailer has lowered their outlook and that's because there's just so much uncertainty ahead with the presidential election, for one thing. So yes, that is true, but I wouldn't hold that against them.

Arielle Feger (24:12):

I don't know. I'm not sold. I think that doing well is not the same, always, as being interesting. I think that there are times where we have retailers on this list where that overlaps, but I would like to see more of that, more of, "What are their partnerships?" I know you mentioned the Hoka and On Running, which I do think is smart, but I'm not sold that a 4.4% comparable sales increase is all that interesting.

Zak Stambor (24:46):

They're also broadening their store portfolio, so they're opening more experiential stores as well and it's part of what's driving some of this growth. But I think the notable thing is this contrast between Nike and Under Armour and Lululemon, and all those brands that just are not doing that well, and Dick's, which is.

Arielle Feger (25:10):

Yeah.

Sara Lebow (25:11):

Yeah.

Arielle Feger (25:13):

I feel like I'm constantly this person.

Zak Stambor (25:15):

That's okay.

Sara Lebow (25:15):

I'm also not convinced because this is so arbitrary, but we just put Zara at the bottom of the list. If we add Dick's to the list, we kick Zara off, and I think Rachel made a better case.

Zak Stambor (25:28):

I do too. That's okay with me.

Sara Lebow (25:31):

So I would give Dick's an honorable mention spot, but I don't think that that's a big enough sales lift. And I get that they're doing well compared to Nike and Lululemon. Those feel like really different retail models to me though. Nike and Lululemon are brands that sell their own products and they sell expensive products. Dick's is a big box store. It's somewhere you can go for cheap things. You said they're expanding experiential. They've also always been experiential, depending on how you want to define that.

Zak Stambor (25:31):

True.

Sara Lebow (26:01):

I think of Dick's Sporting Goods as a store that has a cool little track in it and maybe a rock you can stand on when you're putting on hiking shoes, so it has these draws that aren't necessarily new. I'll give it an honorable mention spot above JCPenney, but I will not add it to our top eight.

Zak Stambor (26:17):

I'll take it.

Sara Lebow (26:18):

Wait a second. There are two extra spots. We kicked both Big Lots and JCPenney off the list. We were sort of unconvinced by both of those. So Zak, I will actually add Dick's Sporting Goods to the bottom of the list. I do think that the good earnings are more interesting than JCPenney's moves.

Zak Stambor (26:35):

Okay, fantastic.

Arielle Feger (26:36):

And by a technicality.

Sara Lebow (26:39):

So that leaves our list at in our honorable mentions, we have Thrive Market and JCPenney. And then our new list is number eight, Dick's Sporting Goods, number seven, Zara, number six, Old Navy, number five, J.Crew, number four, Levi's, number three, H&M, number two, Amazon, and number one, Walmart. There you have it. That's our final list. I think it's a pretty good one. So thank you so much. Thanks for being here, Arielle,

Arielle Feger (27:14):

This was really fun.

Sara Lebow (27:15):

Thanks for being here, Zak.

Zak Stambor (27:17):

Yeah, thanks for having me.

Sara Lebow (27:18):

And thanks for making your Reimagining Retail debut, Rachel.

Rachel Wolff (27:22):

Yeah, lots of fun. Thanks for having me.

Sara Lebow (27:23):

Thanks to our listeners and to Victoria, who edits the podcast and always checks my math on these lists. We'll be back next Wednesday with another episode of Reimagining Retail, an EMARKETER podcast. And tomorrow, join Marcus for another episode of the Behind the Numbers Daily.

MUSIC (27:39):

(Instrumental music)