Pier 1 Imports Inc. (Fort Worth, Texas) announced on Monday that fiscal first-quarter earnings will be lower than once forecast. The retailer's stated reason for the sales decrease is springtime bargain-hunting; although marketing efforts have driven shoppers to the store, they're buying less full-priced home-decorating items.
“As a result of our new advertising campaign and new spring merchandise, we continue to see an increase in traffic and conversion rate, although customers are being very selective when buying,” said Marvin Girouard, Pier 1 chairman and ceo, in a statement. This has resulted in a smaller-than-average transaction.
How long-lived will this bargain-hunting mentality be? Fairly long., according to A.G. Edwards retail analyst Brian Postol. “The consumer has gotten very discretionary with her spending these past few weeks,” he says, “and I think that will only continue.” The company has cited uncertain economic conditions and layoffs as playing a role in shoppers'current practices.