CAN AUTO SALE$ $AVE MAY’$ RETAIL?

MAYNIFICENT

In sum, quarter #1 was a “cold out” for GDP, consumer spending and retail sales. April’s hopes of “springing forward” was shattered by tepid consumer spending and very slow retail sales. What went wrong? Most economists and retailers had figured that warmer weather and gas pump savings would fuel a good to great April. Well, guess what, retail sales were below expectations even though consumer billfolds grew thx to strong employment #s, good consumer confidence, increasing stk prices and yes still very low gas prices. There really was ONLY one sector of the economy, ONLY one category of retail that didn’t collapse in April. It was auto sales. In essence the autos gave April’s retail economy real leadership.  So here’s the merry month of MAY with all of its extraordinary promise. MAY features May Day, Cinco de Mayo, Mom’s Day, May Graduation’s, Kentucky Derby, Preakness, Indy 500, Coca Cola 600, NBA & NHL playoffs, the 1st full mo of the MLB season, the start of the Summer Movie Season, Memorial Day AND the 1st real travel & tourism mo past the holidays. With that all said, no wonder MAY is retailers’ 2nd biggest & 2nd most important sales mo. Table 1 below attests to MAY’s robust retail. We list the 13 categories of retail (as noted by Monthly Census Bureau’s Retail & Food Services data.) In 7 of the 13 classes MAY was ranked #1, #2 or #3 in both 2013 & ‘14. With DEC always being a runaway #1 in overall retail, MAY’s “runner up” status is certainly a winner. (For the curious AUG is a close 3rd place finisher)

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So, here it is: With ½ mo left in MAY, we must HOPE for the return of 2014’s MTR VEHICLE & PARTS DEALERS’ spectacular performance where it accounted for an amazing 23.1% of ALL MAY RETAIL. Beyond the autos it’s true the MAY’s BIG 4 supporting cast of GEN’L MDSERS (Dept Stores & Discounters) and FOOD & BEV STORES (Grocery Stores) both having accounted for 14.0% of ALL MAY ’14 RETAIL; FOOD SRVCS & DRINK PLACES (Restaurants, Bars etc) with 12.5% AND GAS STATIONS (12.2%) must also be major MAY contributors. While APRIL past was ugly for most retailers, it was awesome for the auto industry. APRIL (2015) was “powered by the continued rise in sales of pickup trucks & crossover sport utilities” (NYTimes). In strong harmony, USA2day noted that low interest rates, low petro prices and an avg age of 11 yrs of vehicles on the road continued to fill auto show rooms and to make “cars the stars”. MAY the MAYNIFICENT may well depend on MOTOR VEHICLE SALES to maintain its being the 2nd biggest retail mo of the yr.

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About bernacmd

For over 24 years, University of Detroit Mercy Marketing Professor Michael Bernacchi, Ph.D., J.D, has produced "uNDER tHE mIKE-rOSCOPE", a newsletter discussing current "marketing and advertising¹s bends, trends & ends." A well-know fixture in Detroit and national media, UDM's marketing guru has made several appearances on CNN's "Talk Back Live," the Voice of America worldwide radio network (VOA), ABC, CBS, NBC, MSNBC and on the pages of Sports Illustrated, Time, TV Guide, the New York Times, USA Today, the Wall Street Journal and the Washington Post, to name a few. At University of Detroit Mercy, he has taught courses in Marketing Management, Consumer Behavior, Marketing Communications, Research and Corporate Social Responsibility and Sports and Entertainment Marketing. Michael Bernacchi can be reached at 313-993-1116 or bernacmd@udmercy.edu. Please appropriately attribute the following for their work on uNDER tHE mIKE-rOSCOPE: Yen Ju Lee Robert Rouse Vidhyasagar Natarajan Eric Baumgardner & Ian Young
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