Today in Retail: Consumers Navigating Highest Grocery Prices Since the 1980s; Savage X Fenty Lingerie Brand Eyeing IPO

Today in retail, Ulta Beauty holds its own in the increasingly competitive beauty care sector, while APIs play an important role for businesses when it comes to payment orchestration. Plus, Rivian’s production was cut in half because of supply chain challenges, lease-to-own financing helps financially stretched customers as inflation continues and Yoox Net A Porter launches a menswear resale line and expands beyond the U.K.

83% of Businesses Say APIs Are Critical to Their Strategies

Application programming interfaces (APIs) play a central role in payments orchestration because they bridge merchants and a multitude of payment service provider (PSP) options. More than four out of five (83%) of businesses consider APIs critical to their strategies next year and beyond, according to “Accelerating The Time To First-Time Payments,” a PYMNTS and Spreedly collaboration.

The primary use cases of APIs for these businesses include integrations to payment gateways, fraud management tools and other technologies. APIs are also a key driver of automated services, such as payments compliance detection, particularly when it comes to eCommerce.

Consumers in today’s digital-first economy are accustomed to convenient shopping experiences and paying for their purchases on popular platforms and online aggregators.

Highest Grocery Inflation in 40 Years has Consumers Running to Big-Name Brands

The U.S. Bureau of Labor Statistics (BLS) Consumer Price Index (CPI) released Thursday (March 10) showed that prices for groceries increased 8.6% year-over-year in February, the greatest 12-month increase since April 1981.

This dramatic change could have a significant impact on which grocery brands are chosen by consumers, since price is the top factor influencing consumers’ selection of grocery merchant, according to data from PYMNTS’ study “Decoding Customer Affinity: The Customer Loyalty to Merchants Survey 2022,” which was created in collaboration with Toshiba Global Commerce Solutions.

The study, which drew from the results of a survey of a census-balanced panel of more than 2,000 U.S. consumers conducted in the late fall, found that 37% of consumers rank price above all other considerations when selecting a grocer to purchase from, ahead of the 32% who prioritize proximity, the 8% who seek out payment or fulfillment features and the 6% who look for product or brand availability.

Rivian Says Supply Chain Challenges Have Halved its Production Capacity

Electric vehicle manufacturer Rivian Automotive said that if it weren’t for the global supply chain constraints, it could be producing 50,000 vehicles in 2022, but production will about be half that this year because of those very issues.

Production is being limited by a shortage of semiconductors, wiring harnesses and printed circuit boards, executives said during the company’s quarterly earnings call Thursday (March 10).

Because of the global semiconductor shortage, the manufacturers of those components are allocating them to customers based on the previous year’s demand, so Rivian is limited as a new manufacturer. The supply of the other components is being limited by contract manufacturers’ labor problems, which are often caused by COVID-19.

Rihanna Eyes 3rd Billion Dollar Brand Amid Talk of Savage X Fenty Lingerie IPO

Rihanna-backed lingerie brand Savage X Fenty is said to be considering an initial public offering (IPO) to fund its expansion, according to unnamed sources in a Bloomberg report Friday (March 11).

While no final decision has been made, industry insiders suggest that the Savage X Fenty brand, website and a handful of physical stores could be worth as much as $3 billion. Category leader Victoria’s Secret, which is undergoing an inclusion-focused image remake following its own spin-off and listing 7 months ago, generated $6.8 billion in sales last year via 1,400 worldwide locations and its website and is currently valued at about $4.1 billion.

Yoox Net-A-Porter Launches Menswear Luxury Resale Line, Expands Beyond UK

Luxury resale platform Yoox Net-A-Porter on Friday (March 11) debuted a menswear resale line, Mr Porter, which joins womenswear line Net-A-Porter and The Outnet, according to a company press release.

Yoox Net-A-Porter also partnered with resale technology provider Reflaunt to sell previously owned designer clothing and has expanded its Net-A-Porter line beyond the U.K. into the U.S., Germany and Hong Kong.

Mr Porter Resell, available in the same four markets, features ready-to-wear clothing, accessories, bags, jewelry and shoes. Customers can access a tailored wardrobe refresh service, either in person or virtually. The Outnet will offer resale of both womenswear and menswear in April.

Ulta Beauty Sees Q4 Net Sales Up 24.1%

Ulta Beauty appears to be faring well in the increasingly fierce battle for customers in the beauty care space, as Sephora is deepening its in-store presence at Kohl’s and Walmart adopts the Beauty Space kiosk concept across its stores.

CEO Dave Kimbell said Thursday (March 10) that he’s confident Ulta will continue to hold its own into 2022 and beyond after setting the foundation for its continued growth in 2021, according to a company press release that highlighted its fiscal 2021 Q4 and full-year earnings.

‘Big Ticket’ Retailers That Offer Lease-to-Own Financing Well Positioned to Help Stretched Consumers

Inflation is putting more pressure on already-strained pocketbooks and millions of households are now living paycheck to paycheck — including many making over $100,000 a year — meaning durable goods retailers are interested in making sure their payment options are aligned with 2022 realities.

PYMNTS research found that consumers are increasingly interested in lease-to-own (LTO) options for reasons ranging from bad credit/thin file to the installments-style flexibility it offers at a time of continuing economic uncertainty, where the pandemic is passing the bad-news baton to inflation.

“Finding Retail’s Invisibles: Leveraging Flexible Digital Payments to Reach New Durable Goods Customers,” a PYMNTS and Katapult collaboration, noted: “A sample representative of nearly one-quarter of adult American consumers who purchased durable goods in the past 12 months reported that they were very interested in participating in lease-to-own programs,” translating to up to 46 million new consumers for retailers equipped with LTO financing.