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Michael Kors is driving Macy’s business into the ground

Source: http://www.businessinsider.com/michael-kors-cited-for-macys-downgrade-2015-6

Macy’s is in trouble. 

The retailer’s same-store sales growth has been weakening over the last several years, and Deutsche Bank analysts expect things to only get worse for the department store chain.

Deutsche Bank analyst Paul Trussell on Monday downgraded Macy’s from “buy” to “sell,” saying he has “low confidence that the company can bust out of its same-stores sales rut.”

Sales declines at Michael Kors, one of Macy’s key vendors, were cited as a primary reason for the downgrade.

“We are especially concerned as we see no obvious juggernaut to replace the lost dollars, and we note ongoing challenges at other key vendors as well,” Trussell wrote, specifically naming Coach, Guess, and Ralph Lauren, as additional venders that could cause problems. 

Michael Kors’ same-store sales declined 6.7% in North America during its most recent quarter. The company’s shares are down 43% since the beginning of the year and nearly 52% in the last 12 months.

Michael Kors’ downfall is the result of its widespread popularity. The name became too ubiquitous to remain cool, analysts say. 

But Michael Kors isn’t Macy’s only problem.

Trussell also cited concerns about declining revenue from tourists, as well as a major shift in discretionary spending from products (like clothing) to experiences and technology. 

Macy’s is also suffering from a shift toward direct-to-consumer business models, in which brands use their own websites to sell directly to customers without going through a department! store l ike Macy’s.

At a recent conference, Bloomingdale’s Chairman and CEO Tony Spring said this changing landscape keeps him up at night.

“Our vendors are our partners and suppliers. But many have also become our competitors,” Spring said at the Retail Marketing Society’s “Reinventing the Store” conference in June, according to Trussell.

SEE ALSO: Wal-Mart has a massive plan that should terrify Whole Foods, Kroger, and Trader Joe’s

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FTC starts cracking down on crowdfunding fraud

Source: http://www.engadget.com/2015/06/11/ftc-cracks-down-on-crowdfunding-fraud

Jun 11, 2015

Hang around the crowdfunding scene long enough and you'll hear tales of campaigns that were too good to be true, or creators who simply took the money and ran. It's scary stuff, we know — but you'll be glad to hear that the Federal Trade Commission now has your back when the host sites' safeguards aren't enough. The government body has taken its first action against a crowdfunding fraudster, reaching a settlement with Erik Chevalier after he cancelled a Kickstarter board game project and reneged on promised refunds. The culprit won't pay restitution, unfortunately (he's allegedly unable to pay), but he's barred from any deceptive crowdfunding practices and obligated to honor whatever refund policies he sets. A slap on the wrist, then? Maybe, but it's still a shot across the bow of scammers who are only interested in padding their bank accounts.

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