The 2013 Christmas season was more ho-hum than bah humbug. The Commerce Department reported on Tuesday that sales at U.S. retailers rose a mere 0.2 percent in December, though that balloons up to 0.7 percent if we back out the auto industry.
That’s not great. But it was even worse for those companies whose products were flat-out disappointments. Let’s go over four things that did not sell well during the holiday shopping season.
One of the retailing world’s biggest winners in recent years has been Lululemon Athletica (LULU). The Canadian chain of high-end active-wear for affluent customers has a presence in the ritziest shopping malls.
Well, it seems as if customers are finally starting to flinch at paying $100 for a pair of yoga pants. Lululemon announced on Monday that sales for the holiday quarter will clock in between $513 million to $518 million, well short of its earlier forecast of $535 million to $540 million. Instead of the flat comparable-store sales that Lululemon was originally projecting it experienced negative comps.
It’s fair to say that Lululemon has had a challenging year. There was the embarrassing springtime recall of its Luon stretch pants because they were too sheer, and then its longtime CEO stepped down.
The stock chart is starting to look — in yoga vernacular — like a downward facing dog.
Barnes Noble’s (BKS) dream of being a major force in e-readers has turned into a nightmare. The company reported that Nook sales plunged during the nine-week holiday season.
It was pretty bad. The actual hardware sales declined 66.7 percent as customers avoided buying new Nooks and accessories. Barnes Noble didn’t put out a new tablet last year, so a decline was inevitable. However, it’s hard to bounce back after Nook sales have plummeted by two thirds.
Digital content sales fell by a more modest 27.3 percent — also terrible news since there are more Nooks out there now than there were a year ago. They’re just collecting more dust than before, and that’s bad news for the bookseller’s once-promising digital ecosystem.
We live in what should be an exciting time for consumer electronics, but things haven’t been going according to plan. Pricier items — things like TVs and PCs — have been slumping for a couple of years, and now even the smaller gadgetry is starting to suffer.
When it comes to consumer electronics, hhgregg (HGG) isn’t the largest player in the niche, but it did send the shares of all of its peers lower last week after offering up an ugly holiday report. It may have experienced gains in appliances and home products, but comps for its consumer electronics fell 19.7 percent.
It gets worse. Computing and wireless products tumbled 24.5 percent for the pivotal holiday shopping period. We may not be as plugged in as you may think.
‘Sleep Number’ Beds
Mattresses have been quiet winners in the housing market’s recovery. After all, if you’re going to buy a new home, you’re going to need somewhere to sleep. Folks moving out will often toss their old, lumpy mattresses.
Select Comfort (SCSS) is a leader in the high-end bedding market. Its Sleep Number beds offer air-chambered mattresses with adjustable firmness settings. Unfortunately for its shareholders, Select Comfort has warned that holiday sales didn’t live up to earlier expectations. It was originally forecasting for quarterly sales at its company-controlled stores to post comps in the mid-single digits. Things may have started out that way, but weakness since Cyber Monday finds Select Comfort now holding out for flat store-level sales.
If Thomas Jefferson could catch up on today’s political news, he’d find the brouhaha hauntingly familiar. Jefferson’s critics claimed that his purchase of the Louisiana territory was unconstitutional and rebelled against the decision to grant citizenship to thousands of non-English speaking residents. For that matter, the $15 million pricetag — the equivalent of $500 million today — seemed insanely steep. Nowadays, it’s clear that the opposite was true: The sale worked out to something like $0.42 per acre.
America doesn’t buy presents only for itself: almost 150 years later, it finished World War II by buying a gift for Europe: the Marshall Plan. Surprisingly, the proposal to fund the rebuilding of Europe enjoyed strong bipartisan support in Congress, in spite of its huge price tag. In 1948, it cost $17.6 billion, the equivalent of $168 billion today. Even so, it was probably a bargain in the long run — and, like buying a friend a new Playstation, it’s a gift we got to enjoy, too. In this case, our present bought us good relations with most of Western Europe and laid the groundwork for 64 years (and counting) of peace in the region.
Of course, shortly before America purchased the Marshall Plan, it had also bought itself a huge gift: nuclear deterrence. The Manhattan Project, a $20 billion ($282 billion in today’s dollars) push to create the nuclear bomb, arguably brought a quicker end to World War II and established the U.S. as a dominant force in the postwar world.
Then again, it was only a few years before the Soviet Union detonated its own nuclear bomb, launching the Cold War. Over the course of the 44-year ideological struggle, the U.S. and the U.S.S.R. never directly met on a battlefield, but rather fought each other through extremely expensive (and ideologically uncomfortable) alliances that managed to destabilize much of Asia, South America and Africa. It was also really expensive: all told, we spent an estimated $7.5 trillion on the Cold War, making it arguably the costliest thing that the U.S. has ever financed.
While the Cold War was pricey and destructive, it also had its high points. Launched partially in response to the USSR’s Sputnik satellites, America’s space program started as an outgrowth of the military, but soon transformed into one of the country’s grandest national efforts. At $25.4 billion ($159 billion today), the Apollo moon landings weren’t cheap, but they still stand as a high point in U.S. — and human — history.
Not all of America’s gifts have been quite so productive. The Wall Street bailout, which involved a $4.76 trillion disbursement, of which $1.54 trillion is still outstanding, ranks right below the Cold War in terms of biggest government expenditures.
Motley Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Lululemon Athletica. The Motley Fool owns shares of Barnes Noble. Try any of our newsletter services free for 30 days.