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Nov 202014
 

NEW YORK (
TheStreet) — Online sales from "huge box" retailers such as
Best Buy
and
Target
continue to
surge, and it’s not just because of the ongoing fee wars with Internet giant
Amazon
.
The retailers are also gaining impose a curfew because they’ve learned to integrate the online shopping experience for consumers who still want to visit an actual store.
So far this year, Best Buy’s online sales have risen 24.3%, nearly two times the rate achieved at this point in 2013. In an email to TheStreet in September, a Best Buy spokesman pointed to its new capability to ship merchandise from all 1,400 U.S. stores, essentially connecting the virtual world with the physical store. The result: fewer out of have a supply of post on the Web site that previously had sent customers fleeing to Amazon’s homepage. He added that Best Buy has also improved its checkout process to make it more faultless, channeling Amazon’s seemingly intuitive user experience. Best Buy also has a fee contest guarantee program that includes merchandise found on Amazon.
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For the first time, Target this week shared with investors the sales contribution from its online store to its critical same-store sales metric. Online sales added 0.6% to Target’s better-than-expected U.S. same-store sales boost of 1.2% for the third-quarter. No doubt the company chose to highlight the information to show how its efforts online and on mobile devices are influencing the business.
"Following the success of our second quarter choice to offer free shipping on all Target.com orders over $50, in October we announced that we are offering our guests free shipping on all orders this holiday season," said executive vice president and chief merchandising and supply chain officer for Target Kathee Tesija on a call with analysts. Tesija continued, "We’ve seen a meaningful boost in both orders and conversion compared with trends prior to the announcement."
Target’s free-shipping push and simpler to use Web site come alongside a rollout of a ship from store program of its own, mirroring those being unveiled by Macy’s
, Home Depot
, and the aforementioned Best Buy. In effect, Target and its huge box competitors have turned their huge stores into distribution centers that are closer to the consumer than an Amazon facility. Amazon reportedly has 66 distribution facilities in the U.S.   Target is shipping in this area 60,000 eligible products from 136 stores in 38 markets, covering more than 90% of the U.S. population. According to the company, the skill to access inventory in the store to fulfill online orders "improves our digital in-stocks and drives incremental sales in situations where we are out of have a supply of in our implementation centers."
Summed up Target’s new CEO Brian Cornell on the call, "Target’s digital sales are growing much quicker than the industry and they have been accelerating all year, and we are plotting for even quicker growth in the fourth quarter."
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Not to be bested, the  self-proclaimed low fee leader Walmart
has spent an entire year investing aggressively in its online business, notably count new items for sale that play off the endless assortment being sold by Amazon. The world’s largest retailer has spent 4 cents a share in 2014 for e-commerce investments. For the full-year, Walmart expects the investment to total 5 cents a share to 7 cents a share.
"Our customers want to be able to buy just in this area whatever thing from us, so we are expanding our e-commerce assortment to give them that opportunity," pointed out Walmart CEO Doug McMillon on its third quarter earnings call. Global e-commerce sales increased 21% in the third quarter, following what could be characterized as a generally passionate year online for the retailer this year. In the second quarter, Walmart took the wraps off a "top to bottom rebuild of its entire global technology platform," according to Walmart’s President and CEO Global e-commerce Neil Ashe, making it more lithe in adjusting prices. "Changes to the site can be made in minutes versus days, so we can innovate, test, iterate and deploy new capabilities in real time," Ashe said. "The site has much more personalization, and each customer’s experience is always changing with fresh content that helps them find out new items."
As the ancient guard in retail step up their games online, it looks as if their successes are coming at the expense of the once dominant Amazon. The house that Jeff Bezos built has reported 25.6% sales growth in North America in 2014, slower than the 29% rate attained a year earlier.
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Nov 202014
 

NEW YORK (TheStreet) — Music icon Taylor Swift has hit the impose a curfew running since the relief of her latest baby book, 1989, and that means that the secondary market for her concert tickets is heating up. 
After debuting her first release from the record, "Shake It Off", in August, the 24-year-ancient pop singer has made the rounds on national talk shows, been the cover model for major magazines and even taken the gratuitous title of unofficial ambassador of New York City. She also made business news headlines by removing her catalog from streaming benefit Spotify. Not too shabby for a girl who grew up in the neighboring state of Pennsylvania.
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With millions of hits on Google’s
YouTube, plus more baby book plays and dollars to follow in the coming months, Swift is scheduled to embark on her massive six-month-long 1989 World Tour in ahead of schedule May, beginning with two dates at the Tokyo Dome in Japan. She’ll start her first North American leg of the tour just two weeks later at CenturyLink Center in Louisiana on May 20, then launch a rigorous on the road sequence that will have her play 63 dates across the U.S. and Canada until Oct. 31, when she wraps at Raymond James
Stadium in Tampa. 
Though nearly six months still await before Swift hits the road, ticket prices on the secondary market are considerably high. The average secondary market fee for Taylor Swift tickets on TiqIQ across her six-month tour in North America is currently $263.51. This trumps her ticket average across the North American leg of her Red Tour in 2013, which had a secondary market average of $170.15, or 34.4% below the 1989 Tour. The secondary market for Swift’s tickets — or resales by people who have already bought tickets and are unloading them — are an indication of her by and large popularity.  Swift has been such a cultural force surround the relief of her latest record, there’s been relatively small hostile response over the removal of her albums from Spotify. As her baby book sold 1.28 million copies in its first week, it’s highly unlikely that record number for a 2014 baby book came from a lack of free streaming options. There’s clearly a large market for Swift’s music and that demand has translated over to ticket sales.
Swift will make several tour stops that will see exorbitant secondary market prices beginning in May, but her three most expensive shows will be played at MetLife
Stadium in New Jersey on July 10 and the Staples
Center in Los Angeles, where she will play consecutive top-priced shows on Aug. 25 and 26.
Her mid-July stop at MetLife Stadium currently has a secondary market average of $422.69, 60.4% above the tour average, and get-in fee starts at $94. That may go down, though, as demand was so high a second stadium show was added.
Her two stops at the Staples Center have reached similar heights on the secondary market, with her Aug. 25 date currently listed at $403.78 and Aug. 26 at a $364.45 average. The get-in fee for both Staples Center shows starts at $99.
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Swift’s three cheapest dates on her upcoming tour will be played at stadiums rather than arenas. This is likely due to high-capacity stadium venues providing a surplus of tickets over their arena counterparts, which in turn leads to less ticket demand and cheaper seats. She’ll play two consecutive dates at the Rogers Centre in Toronto on Oct. 2 and 3, but her least expensive show will be at Tiger Stadium in Baton Rouge, La., on May 22.
The average secondary fee for her Oct. 3 show at the Rogers Centre is $217.63 and has a get-in fee of $67, while her initial stop at the Canadian stadium just one day prior sees an average fee of $212.01 and $67 get-in. Neither show will sink as low as her May 22 concert at Tiger Stadium, but, and that show currently sees a $143.97 secondary average, 45.3% below the tour average, and get-in fee of $41.
Arguably the largest pop musician in the world, Taylor Swift has built a young career that continues toward its apex with each subsequent record relief. 1989 has been her most commercially successful record yet, and the "Blank Space" singer will only continue to ascend as she embarks on her 2015 World Tour.
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At the time of periodical, the author held no positions in any of the stocks mentioned.
This article is commentary by an self-determining contributor, separate from TheStreet’s fixed news coverage.


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Nov 202014
 

NEW YORK (TheStreet) — Call it innovator’s poignancy. Sometimes a startup identifies an ignored niche, validates that there’s money to be made, then gets trampled by bigger companies that suddenly smell cash.
Is that about to happen to San Francisco-based hotel booking service startup HotelTonight? The company’s premise has been simple in its elegance. Surrounded by empty rooms that are worthless without guests, a smart hotel operator will bend on price to put a head on the bed. And mobile, with its built-in ubiquity and immediacy, ties it all together.
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HotelTonight debuted four years ago and by now its apps are on over an estimated 10 million iPhones and Androids. The company isn’t worried about the onslaught of competition from the larger industry players, citing its singular focus on just hotel rooms and its lower-commission rate for hotels business model.
Now that HotelTonight is becoming a household name, suddenly, Priceline
 (market cap: $60 billion), Expedia
 (market cap: $11.1 billion), Orbitz 
 (market cap: $845 million), and the big chains such as Marriott
, Hilton 
 and Starwood 
  are piling into the same-day hotel booking niche. The reason is their sense that this is a fast-growing market.

“I was suspicious of the size of the opportunity,” said Douglas Quinby, vice president of research at Phocuswright, a travel market research company. “Subsequent to the research we did, I am less suspicious. We see quite a bit of demand for close in [to the travel date] hotel shopping.” He added that “the OTAs [online travel agencies such as Expedia and Priceline’s Booking.com] are in this very aggressively. It’s a very crowded, competitive market.” One reason, Quinby suggested, is that across the sector, operators report rising bookings via mobile devices and those bookings, as a rule, tend to be short notice.
The big online travel agencies admit they are interested. “Same-day booking is a real market,” said Keith Nowak, director of communications at Travelocity, which claims annual gross bookings of $10 billion.
Then there also are many smaller competitors such as Hong Kong-based HotelQuickly and LMT — aka Last Minute Travel. Groupon 
, travel site Hipmunk and a parade of others also have had eyes on the same-day market.
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Bad as all that might seem for HotelTonight, if you ask Sam Shank, the CEO and co-founder of HotelTonight, whether he’s about to be crushed by other operators, he literally laughs. “We continue to grow the business nicely. We are completely focused on mobile and last-minute. We don’t have flights, we don’t have cruises, we don’t rent cars. We focus on getting the best hotel deals.”
Part of Shank’s confidence is rooted in his belief that he has “reinvented the relationship with the hotels.”
Most hotel operators hate the online travel agencies. That is because they charge commissions typically ranging from 15% to as much as 30% and, especially for independent hotels and smaller groups, the rates are take them or leave them.
“We charge the lowest commissions in the industry,” said Shank. “No higher than 15% and often much lower. That’s why we get exclusive inventory and we have hotels competing to get into HotelTonight.”
Shank added, “Hotels give us an exclusive discount. Our prices are better than you will find at the large OTAs.”
HotelTonight also is itself no pauper. In September 2013, it closed a $45 million funding round. That lifted its total capital raised to $80.35 million. Investors include Coatue Management, GGV Capital, Battery Ventures, Accel Partners, US Venture Partners, and First Round Capital.
One criticism of HotelTonight is that it shows a user a tightly-edited list of hotel options. In Manhattan, for instance, in a quick search, HotelTonight showed 11 hotels, from the $229 Paramount Hotel in the theater district to the $549 New York Palace in Midtown East. Other services may produce literally hundreds of options. Said Shank: the edited list is a plus for a time-crunched traveler hunting for a room, now. “We built the app for speed and convenience,” he said.
There’s been at least one sign business may be slowing amid rising competition, forcing it to expand beyond same-day bookings. The company’s move in late September to end its policy of only selling rooms for the same night and opening the door to booking seven days in advance has put it on a direct collision course with the many online travel agencies.
Asked how that initiative was faring, Shank said, “It’s only been around for a month, it’s too early to say. The people who are booking in advance are much more likely to be first time customers. We are reaching a new audience.”
What’s the verdict on HotelTonight? Phocuswright’s Quinby, who follows this space as closely as anyone, said: “I definitely don’t think they are toast. They’ve built a great mobile app. HotelTonight is not about a cheap hotel room. It’s about spontaneity.”
“The real question is, just how big is the last-minute market?” said Quinby. Is it big enough to feed all the hungry mouths? Sam Shank and his investors will definitely be finding out and, right now, few count him out. He validated the market, he proved he understands that traveler, and now it’s up to the many competitors to prove likewise.
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At the time of publication, the author held no positions in any of the stocks mentioned.
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This article is commentary by an self-determining contributor, separate from TheStreet’s fixed news coverage.


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Nov 202014
 

NEW YORK (TheStreet) — Shares of Autohome
are down 1.23% to $42.73 on heavy trading volume after the company announced pricing of $42.50 per ADS in a registered follow-on public offering.
The Chinese company, which delivers self-determining and interactive content to automobile buyers and owners, will issue and sell 1.65 million of its own ADS. The selling shareholders will sell an aggregate of 6.85 million ADS.
The yucky proceeds to the company will be approximately $70.1 million, and the yucky proceeds to the selling shareholders will be approximately $291.1 million.
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Approximately 2.98 million shares have already changed hands compared to the average of 1 million by 1:51 p.m. in afternoon trading on Thursday.

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