In a bid to improve sales, Chico’s FAS, Inc. (CHS - Free Report) has partnered with First Insight Inc., a technology company that assists leading retailers in making efficient merchandise and marketing related decisions. Following this announcement, Chico’s shares advanced 3.4%.
The rapidly evolving and highly competitive retail environment demands developing trend-right products that fit consumer needs. Leading retailers therefore seek latest market information to make the right operational decisions. Chico’s decision to merge with First Insight is in line with this strategy.
Being a specialty retailer Chico’s can make use of First Insight’s predictive analytics models to accurately understand consumer preferences. This will aid the company in making effective design and pricing decisions for its diverse category of products including shoes, apparel, accessories and jewelry offered across both online as well as brick-and-mortar stores.
Further, the management believes this partnership will enable it to identify top performing products as much as 12-months in advance of the season. The key objective of this strategic partnership is to gain leverage its customer data with First Insight’s online customer engagement and analytics to precisely deliver what consumers want. Further, this is expected aid in lowering markdowns and expanding sales.
As for First Insight, the partnership is an opportunity to expand its business network and gain from the brand image and popularity of Chico’s in the U.S. Under the deal, First Insight will utilize its resources to accumulate real-time consumer insights on Chico’s new products. Such data will then be analyzed using predictive analytics models to assist Chico’s understanding its customers and fine tune inventories to enhance customer experience.
Over the past one month, shares of this Zacks Rank #5 (Strong Sell) stock has declined 10.8% compared to the Zacks categorized Retail – Apparel/Shoes industry’s fall of 2.9%.
Better-ranked stocks in the Retail space includes Big 5 Sporting Goods Corporation (BGFV - Free Report) , The Children's Place, Inc. (PLCE - Free Report) and Build-A-Bear Workshop, Inc. (BBW - Free Report) each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Big 5 Sporting has an average positive earnings surprise of 94.5% over the trailing four quarters and a long-term earnings growth rate of 9%.
The Children's Place has an average positive earnings surprise of 36.6% over the trailing four quarters and a long-term earnings growth rate of 8%.
Build-A-Bear Workshophas an average positive earnings surprise of 67.5% over the trailing four quarters and a long-term earnings growth rate of 22.5%.
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