Wal-Mart even mentioned that sales spiked in 1999 due to Y2K spending, giving the company a harder comparison this year. Wal-Mart may have a point. Instead of coming up with fundamental reasons why so many companies had trouble this last holiday season, it should be more useful to look at which companies were successful. Studying these companies can help us figure out what to look for in future investments. Few trends appear in December's Retail Details , but two important points did jump out at me.
People look for values.
American Eagle sells clothes for high schoolers and college-aged men and women as demonstrated on WB's Dawson's Creek , arguably American Eagle's greatest marketing tool. While there are other differences, the single biggest difference between the companies is that American Eagle aims for a broader audience, and this is demonstrated in its prices. While not a traditional discounter, Kohl's generally focuses on providing better values to customers. Focusing on value was not a surefire recipe for holiday success. However, looking forward, I expect companies that have a strong focus on providing great values will be among the success stories of 2001.