Pandemic recovery spawns new shopping trends

The rush back to in-person activities and events hasn't meant a total collapse in retail sales. In some ways, the reopening has actually been a driver.

Driving the news: Some of the most wanted products from Macy's and Dick's Sporting Goods during the spring months, for example, reflect demand for things that people need as they rushed out of their homes.

• Luggage and beauty sales were a bright spot for Macy's during the second quarter, the company reported today.
• At Dick's, consumers who have stuck with their pandemic health habits are helping to drive sales, CEO Lauren Hobart noted on an analyst call.

Why it matters: Consumers overall have been adjusting their spend over the past year away from nice-to-have things to necessities like groceries or experiences.

• The shift has been in response to high inflation and more options to use their savings.

The intrigue: While all retailers are facing these same pressures, they've fared differently depending on their specialties.

• General retailers like Walmart and Target have seen sales of apparel and sporting equipment plummet.
• But results from Macy's and Dick's suggest consumers have still been dishing out for premium options in the same categories.
• "We have not seen a trade-down [in products] as of yet," Jeff Gennette, Macy's CEO, said on a call with analysts this morning.

By the numbers: Sales at Dick's were up 38% in the second quarter compared to 2019. At Macy's, sales were up 21% for "occasion-based categories" which include career and tailored sportswear, fragrances, shoes, dress and luggage.

Be smart: The key thing all retailers have to get right at this moment is precisely picking the stuff they want to sell in their stores.

• Miscalculation — as Target has proven — means severe markdowns and a scramble to clear shelf space for back-to-school, Halloween and end-of-year holiday goods.

What to watch: Macy's lowered its outlook for the year based in part on inventory issues, as did Nordstrom after Tuesday's bell.

• Dick's, meanwhile, raised its outlook on confidence that its new, higher-margin product mix will improve its results.