Advertiser Tidbits for the week of 11/08/04

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Advertiser Tidbits for the week of 11/08/04

Automotive:

We’ve known for a while that DaimlerChrysler was planning to bring its Smart brand to the U.S. USA Today now reports the first model will be the Formore, a small SUV that will go on sale in ‘06.
Toyota is offering a free download of the music from its current commercial at its website for a limited time.

Retailing:

Wal-Mart is issuing a preliminary number of a 2.8% gain for October. It had initially predicted a 2-4% monthly increase.
Retail Traffic says it’s not going to get easier for discount retailers for a while--their generally lower-income customers are being squeezed the worst by gas prices. A retail analyst said lower-income consumers are being hit by both higher gas and food prices and that’s “negatively affecting disposable income and spending.”
Kmart has finished revamping its consumer electronics departments in all its stores, and will focus on products like video games, home entertainment centers, and MP3 players.
Orchard Supply Hardware has started selling appliances at four of its stores, two each in the L.A. and San Francisco markets. OSH is a subsidiary of Sears, which has been selling appliances successfully at its Sears Hardware chain.
J. C. Penney, mostly mall-bound in the past, is continuing to look for locations to build free-standing stores. It opened its first a year ago in a Dallas suburb. The new prototype stores do not carry furniture, and have front-end check-out, wider aisles, and shopping carts.
Smart & Final had a good quarter, with same-store sales up 12%. The company plans to open some smaller stores, which will give it a faster break-even point in some non-core markets. Current stores are in the 20-22,000 square foot range, but the new prototypes will be designed to run about 16-17,000 sq. ft.
Haverty Furniture had started the year out quite well, but hit a tough stretch lately. Comp store sales were down 0.9% in October, and have pulled the Y-T-D number down to just +1.4%. Haverty, which operates 115 stores in 15 states, will enter Ohio for the first time later this month, opening in Cincinnati.
Stop & Shop, which has had some Office Depot “store-within-a-store” locations, is switching partners to Staples. Staples has tested a similar arrangement in some Kroger-owned stores under the Smith’s banner. Office Depot will continue to operate in some Albertson’s units.
May Department Stores released its October sales figures early. Same store sales decreased 2.3%, on slow sales of dresses, coats, intimate apparel and home furnishings.
Casual Male has taken over the 22-unit Rochester Big & Tall chain.
Atlanta-based Rhodes Furniture filed for Chapter 11 bankruptcy protection and will close 26 of its current 89 stores. Its biggest complete market exits will be in Ohio.

Drug Store & Supermarket Chains:

Rite Aid said this week that same store sales for October were up just 0.3%. On the other hand, industry leader Walgreens’ October comp sales increased by 8.1%.
Overall October chain store sales are pacing at +3.2% over last year. That’s off slightly from September’s figures.
Long’s Drugs had a 2% drop in same-store sales last period, blaming a calendar shift that pushed Halloween into a later period, and last year’s gains from the California supermarket strike.
CVS’ profit has taken a hit because of the Eckerd acquisition, but says the integration of the new stores is ahead of schedule.

Fast Food & Restaurant Chains:

Restaurant Business says Applebee’s ad budget will be about $160 million next year, up about $30 million from this year.
The National Restaurant Association’s Restaurant Performance Index was up in September, with overall same-store sales positive for the first time in seven months.
Panera Bread will make a big move into the chicken category, rolling out a chicken Caesar sandwich next week.
Burger King had another good month, with system-wide same-store sales up 6.9%. After a long string of misses, it’s the ninth consecutive month in which the company’s comps were positive.
Wendy’s, which has not had good results the last few months, is dropping its Mr. Wendy campaign, with new spots, due to start next month, expected to emphasize its heritage and menu offerings.
Triarc, which franchises Arby’s, reported a 3% same-store quarterly sales gain in its owned stores, but was outdone by franchisees whose comps were up 8%.
Numbers haven’t always been great for Papa John’s, but domestic system-wide sales for the quarter were up by 1.2%.
Wendy’s has started to struggle in recent months, and both company-owned and franchised stores were down from 5.1-5.8% in comps last month. The Tim Horton’s subsidiary continues to do very well; however, with same-store sales up 9.0% for the month and 10.0% year-to-date.
AFC Enterprises has signed an agreement to sell its Church’s Chicken chain to Atlanta-based Cresent Capital Investments, which also owns the Caribou Coffee Co. The deal is expected to close by the end of the year.

Other Categories:

Probably inevitable given the weather this summer, Tropicana will raise prices on orange products by 3-5% and grapefruit products by almost 24%.
Buried within last week’s Viacom earnings release was some good news from its Paramount Parks division. Revenues were up 7% in the third quarter, based on higher attendance, even though per capita spending once in the park was down.
PepsiCo plans to launch a year-long effort in support of its diet beverages. The company will spend $70 million for Diet Pepsi, Sierra Mist Free, Diet Pepsi Wild Cherry and Pepsi One.
For the first time ever, Victoria’s Secret is launching a holiday campaign portraying itself as a gift destination.
Automotive Capital Group is breaking a new TV campaign for its NowAuto.com website. The company goes after the “sub-prime” car financing market, with no-credit-check financing.

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