The POWER data OF

A State of the Industry Report, by Contents Agent of 2A Agent of Change

3A Engaging Consumers Intelligently and Creatively Change 4A, 5A Talking Privacy With For the past few decades technology has driven trends. The agent of change in the next decade will be the power of data. Consumers; Fighting Headlines suggest that investment in data is necessary to compete and even Payment Fraud; What survive in the retail space. From demographic data to online and in-store purchase Consumers Think histories, from payment trends to loyalty insights, data is seemingly everywhere. But what exactly does it all mean? Data is transforming the retail landscape before our eyes, driving the omnichan- 6A, 7A Q&A: A Look Ahead nel revolution and the rapid changes in the consumer shopping experience. Data insights improve customer experiences and influence shopping behavior in ways never before seen in the retail industry. 3A CSA Top 100 Retailers are figuring out what makes consumers tick, how to make them happy, and how to keep them coming back. In 2018 and beyond, making the most of data as a strategic resource will be a key to retailers’ success. This state of the industry report looks at how data is accelerating commerce by helping retailers understand consumer behavior, fight payment fraud, engage consumers on their terms, and start a dialog with consumers about privacy. n

2A SEPTEMBER/OCTOBER 2018 CHAINSTOREAGE.COM Engaging Consumers Intelligently and Creatively

We’re moving beyond the age of up what they need, and use the services experiences. Retailers that satisfy those ele- innovation and into the age of experience. that they need without any conversation. vated consumer expectations are strongly Retailers and marketers need to focus It’s increasingly clear that loyalty pro- poised for success in the form of increased on the data that enables and crafts those grams are central to engagement. A 2018 visits and customer loyalty. experiences. Data sits underneath and report by Worldpay and Socratic Tech- Integrating data from different sources drives consumer expectations of seamless nologies revealed that 55% of consumers helps develop a broader understanding of commerce. surveyed use membership deals always or who that customer is and what makes them Opening a dialog for informed conver- most of the time, with the most frequently tick. Knowing that a customer is a mom, for sation between retailers and consumers used discounts tied to loyalty membership. example, with kids who maybe travels once was once only a distant dream for retailers. When payment is made retailers should a month is important as these are key fac- Being able to do so at the point of purchase be keeping track of and rewarding that tors influencing her purchases. Having that is nothing less than revolutionary. Properly loyalty. Money ought to change hands fuller picture helps a retailer understand harnessed data enables more personalized seamlessly. The friction of having to sort the potential to grow the customer’s basket and therefore relevant conversations, through all your loyalty cards—or even type size or visit frequency, turning her into a elevating consumer engagement to an in your phone number—melts away. The $1,000 a month shopper. art form. ease of payment and the reward is what Seeing the full picture beyond how she However, sometimes the best engage- sticks. That’s a seamless customer journey spends allows retailers to better serve her ment is total transparency. Take payments. charged by data. as a customer. Having the right people and The most seamless, fast, and compelling Consumer expectations are completely processes around your data to nail that— payments experience is one where you’re changing in this age of experience. The and scale that—provides insights that might not thinking about payments at all. Con- intelligent application of data is the con- change everything from how you advertise sumers should be able to come and go, pick nective tissue that enables those seamless to how you stock your shelves. n

Understanding Consumer Behavior The ultimate prize for the retailer is a through the lens of what shoppers have wider view might reveal that the custom- clear and complete picture of the con- done in your store, you’re missing a huge er is spending $1,200 a month on restau- sumer. Retailers are increasingly blending part of the picture. Take a grocer that has rants, quick serve— and other grocery. demographic data—age, gender, house- a customer spending $400 per month Knowing that gap exists opens prime hold type—with purchasing, payments in her store. The customer has been loyal, marketing opportunities to better serve and other insights to better understand shopping in the store almost once a week that customer and increase the value of consumers. If you are only looking for over a year, which sounds great. But a the relationship. n

CHAINSTOREAGE.COM SEPTEMBER/OCTOBER 2018 3A Talking Privacy With Consumers Retailers face both rising consumer expectations and They’re more likely to appreciate the retailer for being smart. evolving regulatory requirements around data privacy. Privacy A little give and take can go a long way toward building is extremely important to consumers, but it also offers a great relationships with consumers. Research conducted in 2018 opportunity for retailers to open a dialog with consumers. by Worldpay and Socratic Technologies revealed that more Retailers can show that they are deserving of consumer trust than half (52%) of consumers are willing to offer personal by demonstrating value in the data exchange. If the value they information in exchange for free shipping. are getting isn’t well understood, consumers may feel used. It’s Retailers do need to demonstrate good stewardship harder to establish trust when data drives retargeting and pop- of personally identifiable data and payments data from a up ads that annoy consumers. security standpoint. Protecting against worst-case scenar- On the other hand, intelligent use of data that delivers real ios like data breaches is vital. But retailers who get it right value and improves consumer experiences starts a virtuous cy- are demonstrating to customers the value they receive in cle. When retailers improve the shopping experience and reward return for the use of their data. Customers are likely to consumers by leveraging their data, they aren’t as likely to worry reward those efforts with greater trust, repeat visits and about the retailer invading their privacy. bigger baskets. n

4A SEPTEMBER/OCTOBER 2018 CHAINSTOREAGE.COM behavior. Fighting fraud starts with understanding what ‘good’ looks like, rather than trying to always understand ‘bad’ transactions. Data allows you to understand how someone’s spending so potential fraud is flagged the instant Fighting something doesn’t look right. Data leveraged with the right tools helps prevent fraud before it ever takes place. The hard work is connecting the dots and leveraging machine learning to block bad transactions while letting the Payment good ones through. Getting it wrong either way is a big deal. You’re either losing money to fraud or you have an upset customer because they were declined. The goal is to maxi- mize acceptance of good transactions while locking out Fraud the bad. Nothing puts the brakes on retail commerce like theft. Fraudsters aren’t packing up and going home. They’re Fraud is a clear and present threat to consumer confidence going to find leaks, and they’re going to find a way through. and retailer bottom lines. Data is now an essential tool in Data offers the raw material for retailers to build meaningful the fight to safeguard and secure commerce, anywhere defenses. Retailers with visibility into enough data to strike and everywhere it takes place. that balance will have a strong leg up on the competition by Attacking fraud relies on many of the same principles of ensuring a hassle-free and safe shopping experience for data analysis that enable better understanding of shopping the consumer. n Data Breaches: What Consumers Think Worldpay and Socratic Technologies • After a data breach, consumers recall email notifications and 68% looking for conducted a survey of 500 consumers to retailers and restaurants notifying them by credit and identity theft monitoring. learn more. Here are some highlights. mail and offering credit and identity theft Talking Privacy monitoring. Mailed letters are the most • Most consumers are satisfied with the • About one in four consumers (24%) common action reported by survey re- steps taken by retailers and restaurants have been impacted by a data breach spondents at 39%. Credit and identity theft following data breaches. that compromised their payment card in- monitoring are the second most popular formation. Across generations, Gen Xers action with 37% of participants reporting. In the survey, 86% of total participants With Consumers are the group with the highest incidence Email notifications are a close third at 31%. express their satisfaction with the respons- rate at 26%. Retirees have the lowest es they received from merchants following incidence rate at 20%. • When a data breach affects their data breaches. personal information, consumers expect • Consumers believe that mass mer- to be notified and offered credit and • The majority of data breach victims con- chants are the chief victims of recent data identity theft monitoring. Survey partic- tinue to patronize retailers and restaurants breaches. Survey respondents are most ipants expect an email notification with that have come under attack. aware of data breaches reported by large 75% of respondents reporting. This is fol- Among the victims of data breaches that mass merchants at 51%. This is followed lowed by credit and identify theft moni- participated in the survey, 61% indicate by department stores at 23%. toring (60%) and mailed letters (60%). that they “probably” or “definitely” would continue patronizing a retailer or restaurant • Among restaurants, respondents most • Millennials have the highest expectations that was attacked. often hear about data breaches in the when it comes to email notifications and For survey participants that have NOT quick-service sector. Consumers are most credit and identify theft monitoring. yet been victims of a data breach, only 50% aware of data breaches at fast casual/quick The youngest generation has the highest report that they “probably” or “definitely” service restaurants (20%), followed by fami- expectations for these services to be of- would continue patronizing a retailer or ly dining (10%) and coffee shops/cafes (6%). fered, with 83% of Millennials expecting restaurant that exposed their data. n

CHAINSTOREAGE.COM SEPTEMBER/OCTOBER 2018 5A W: How have loyalty programs evolved as competition increases and using data analysis becomes more prevalent?

J: At best, we’re making ourselves invisible. Think about times where you pay for transportation without exchanging money or even swiping a card. You can also think of amusement & parks that incorporate an entire expe- : rience into a bracelet or an app. The fuel is data. Q A Data drives the expectation of the A Look Ahead consumer that it’s all seamless. I can come and go as I need, the money is transacting without me thinking about it and you should be rewarding me for Nicole Jass, Senior Vice spending that money. The friction of President, Integrated having to search through cards goes Payments, Fraud, and Data away. The connective tissue is collect- Products at Worldpay, ing and connecting the data. discusses what she sees on the horizon for data’s W: What’s next on the horizon influence on retail. for retailers seeking insight from consumer data?

J: I think of the ways retailers are Worldpay: What do you find most job of using data to create unified using consumer data in three buckets: exciting about connecting data experiences across channels. These better and more thoughtful adver- trends to customer engagement? companies tie everything together tising, intelligent measurement and from curated emails that understand attribution, and finally, strategy. Nicole Jass: It’s a thrilling time for each consumer’s shopping histo- Advertisers have made great strides retail. There is a real sense of shared ry, to being able to checkout right in using omnichannel shopping data to optimism about how intelligent use there while you’re buying in-store, better connect with their audiences— of data improves both consumer ex- to fantastic app experiences. that story is well understood. Market- periences and retailer bottom lines. The brands that are getting it ers have been using data to demon- Connected data is transforming and right are the ones that surround the strate value through more granular elevating the very nature of engage- customer and get them the apps, measurement tools. That attribution ment across the retail landscape. the in-store experience and the piece still needs work but is progress- Retailers are reducing friction in marketing campaigns that resonate. ing nicely. The future horizon is lever- payments, realizing the immense They’re all tied together—and that’s aging data to inform strategy—how to promise of loyalty programs, and the magic. take a fresh look at footprint strate- becoming more responsive to Obviously it’s compelling for the gy, or omnichannel experiences, for consumer needs. I love the retail- retailer because it’s going to be example. Used right, data can inform ers who are connecting all of the able to drive more loyalty, but I get optimized configurations of stores dots for their shoppers. I frequent excited about it as a shopper to have in a given region and can help decide many retailers that are doing a great those more meaningful experiences. what kind of merchandise to put in

6A SEPTEMBER/OCTOBER 2018 CHAINSTOREAGE.COM each store based on demographics and that’s so natural to us, and especially abling truly seamless retail experiences. localized sales patterns. how we shop. Voice is a fascinating interface that Data can help with everything from promises infinite practical utility. Voice content curation to understanding is naturally plugging into our total how people are spending online to The brands that experience. influence local stores. If you watch children interacting with Nearly all retailers are on a mission are getting it right Siri and Alexa—it’s not novel to them. to collide the worlds of online and are the ones that It’s grounded in how they think of in-store because the consumer ex- the world. Retailers talk a lot about pects there to be this really cohesive surround the enabling conversations with consum- experience anywhere they touch a ers. Now those conversations are brand. It’s a defining anchor of omni- customer and get literal, not just figurative. commerce—they’re just not separate them the apps, the anymore. W: E MV is winning the battle Being able to connect the experi- in-store experience against fraud in-store, but the om- ences so consumers can focus on the and the marketing nichannel merchant still needs to be value of their purchases instead of the diligent about fraud online. How can means to obtain them is critical. That campaigns that a payments partner help retailers fusion starts with connecting the data. address card not present fraud? The future is about the ability to con- resonate….They’re nect the dots, make retailers’ market- all tied together—and J: Data is extremely powerful in com- ing dollars go further, and ensure that batting fraud. The key is if you under- what they’re spending on is actually that’s the magic. stand the good and what’s working, driving consumer behavior. you can more easily see when some- thing doesn’t work. W: What should we expect now that Think about walking into a store, Look for a partner that understands artificial intelligence is maturing and saying “Hey,” to your phone or watch, this. If you get it wrong and decline making its way into the retail market? “Where do I find x?” You’re directed a good transaction, that’s a poor to the proper aisle, grab your item, customer experience. You can lose J: One of the most relevant and influ- and walk out the door with the simple customers by declining good transac- ential applications of artificial intel- words “pay with my Amex” or “pay tions You need to get it right when ligence is voice. Voice is an interface with my Visa.” That’s data and AI en- they hit submit. n

About Worldpay Worldpay is a leading payments technology company with unique capability to power global integrated omni-commerce. With industry-leading scale and an unmatched integrated technology platform, the company offers clients a comprehensive suite of products and services globally, delivered through a single provider. Worldpay processes over 40 billion transactions annually through more than 300 payment types across 146 countries and 126 currencies. The company’s growth strategy includes expanding into high-growth markets, verticals and customer segments, including global eCommerce, Integrated Payments and B2B. Worldpay, Inc. was formed in 2018 through the combination of the No. 1 merchant acquirers in the U.S. and the U.K. The firm trades on the New York Stock Exchange as “WP” and the Stock Exchange as “WPY.” Visit us at www.worldpay.com.

CHAINSTOREAGE.COM SEPTEMBER/OCTOBER 2018 7A TOP

Retailers 2018

has experienced in recent years, the Top 100 rankings have remained extremely consistent in recent years, particularly in the upper echelons. The list remains mid a disruptive and evolving apparel lines and mattress and bedding dominated by retailers with extensive retail landscape, Inc. brand, also play into the same. store fleets. Astill stands likes a colossus. The retail Walmart is also integrating more and But while the retailers that dominate giant has topped Chain Store Age’s Top more technology into its stores and the list remain fairly stable year-over year, 100 ranking of the nation’s largest leveraging them as valuable physical it is by no means business as usual for retail companies (based on annual rev- assets. From frictionless checkout to these companies. The lines that separate enue) for more than 20 years. It is the curbside pickup of online grocery orders traditional retail from online retail are rap- largest retailer the U.S. and the world to such click-and-collect innovations as idly disappearing and for a majority of the has ever seen. in-store pickup towers, the chain keeps Top 100, omnichannel is the name of the The past year marked a new milestone expanding its omnichannel options. It’s game. From Macy’s to to Kohl’s, for Walmart as it topped $500 billion in also testing self-driving cars in Arizona retailers are shuttering poor performing revenue, becoming the first U.S. corpora- for grocery pickup. locations and/or trying on smaller foot- tion to do so. Walmart’s revenue is more prints and investing in digital capabilities. than double that of the country’s second Even companies that were slow to largest company, Exxon Mobil ($244.4 Walmart’s biggest and fiercest rival, Am- embrace the convergence of physical billion). Walmart’s transformation from azon, is No. 2 on the list for the second and online are getting in the act. Costco a traditional brick-and-mortar retailer to consecutive year. The online behemoth Wholesale Club, No. 3 on the list, has been a high-tech innovator has been nothing is growing by leaps and bounds — its ramping up its offerings with two-day short of remarkable. North American revenue jumped 42% grocery delivery and same-day fresh While physical stores remain a cor- last year. With its grasp on retail secure, delivery. It has also given in-store employ- nerstone of its success and strategy, the company continues to burnish its ees in select locations tablets to facilitate Walmart has been investing heavily in its reputation as an industry disruptor, with online orders. digital operations — and shows no signs package delivery, pharmacy and health- of backing off. The company’s $3.3 billion care just a few of the newer items on its METHODOLOGY: The annual Top 100 ranks acquisition of Jet.com in 2016 not only agenda. And at press time, reports said companies by total revenue (as opposed to gave Walmart a new online platform, Amazon was considering opening some only retail sales) as reported in each firm’s most but added a new, tech-savvy retailer to 3,000, cashier-less stores recently completed fiscal year. The numbers for its C-suite via the appointment of Jet by 2021. privately owned companies that do not release founder Marc Lore as CEO of Walmart’ Innovation is woven into the very fabric annual reports and/or financial statements are U.S. e-commerce operations. of Amazon. The company holds more estimates based on independently published Under Lore, Walmart has been on an patents (7,096 as of Jan. 1, 2018) than reports and CSA research. online acquisition spree, adding, most any other retailer. The patents span a In addition to annual revenue, the metrics recently, such hip brands as Modcloth wide array of emerging technologies, in the Top 100 include net income and store and to its portfolio. The deals from machine learning to artificial intelli- count. For retailers based in North America, the not only brings new online talent into gence to robotics. Amazon also invested data reflects the company’s total global store Walmart, but also allow the retailer to $16.1 billion in R&D activity last year, network (except where otherwise noted.) target younger, more affluent custom- more than any other U.S. company. For foreign-based companies, such as Ikea, ers, something that is also part of its only the metrics relating to the retailer’s North playbook. The chain’s revamped web- STABILITY American division are given (except where site and other efforts, such as its new For all the changes the retail industry otherwise noted).

08A SEPTEMBER/OCTOBER 2018 CHAINSTOREAGE.COM 2017 2016 2017 Net 2016 Net 2017 2016 Revenue Revenue Income Income Store Store [000] [000] [000] [000] Count Count 1 Walmart Inc. Bentonville, Ark. 500,343,000 485,873,000 9,862,000 13,643,000 11,718 11,695 1/31/2018 www.walmart.com Walmart 2 Amazon.com is the first Seattle 177,866,000 135,987,000 3,033,000 2,371,000 485* 7 retailer 12/31/2017 www.amazon.com in history to exceed 3 Costco Wholesale Corp. Issaquah, Wash. 126,172,000 116,073,000 2,679,000 2,350,000 741 741 12/14/2017 www.costco.com $500 4 The Kroger Co. billion Cincinnati 122,662,000 115,337,000 1,907,000 1,975,000 2,782 2,796 2/3/2018 in annual www.kroger.com revenue. 5 Deerfield, Ill. 118,214,000 117,351,000 4,101,000 4,191,000 13,200 13,200 8/31/2017 www.walgreens.com

6 The Home Depot Atlanta 100,904,000 94,595,000 8,630,000 7,957,000 2,284 2,278 1/28/2018 www.homedepot.com 60% 7 CVS Health R Woonsocket, R.I. 79,400,000 81,100,000 6,622,000 5,319,000 9,803 9,700 of retailers 12/31/2017 cvshealth.com believe that their company 8 Target Corp. will likely face Minneapolis 71,879,000 69,495,000 2,934,000 2,737,000 1,822 1,802 2/3/2018 disruption www.targetstores.com from more 9 Lowe’s Cos. innovative, Mooresville, N.C. 68,619,000 65,017,000 3,447,000 3,093,000 2,152 2,365 2/2/2018 nimble and www.lowes.com customer- 10 Albertsons centric Boise, Idaho 59,924,000 59,678,000 463,000 -374,000 2,318 2,324 2/24/2018 organizations; www.albertsons.com

11 Alimentation Couche-Tard Laval, Quebec 52,394,400 37,904,500 1,680,500 1,208,900 12,740 10,869 4/29/2018 www.couche-tard.com 60% 12 Ahold Delhaize also believe Chantilly, Va. 46,119,320 40,823,839 NA NA 1,954 1,990 12/31/2017 their firms are www.aholddelhaize.com not investing 13 Best Buy Co. quickly enough Richfield, Minn. 42,151,000 39,403,000 1,000,000 1,228,000 1,008 1,610 2/3/2018 to keep pace www.bestbuy.com with the speed 14 The TJX Cos. of technology Framingham, Mass. 35,865,000 33,184,000 2,608,000 2,298,000 4,070 3,812 2/3/2018 change and www.tjx.com consumer 15 Publix Super Markets expectations. Lakeland, Fla. 34,560,000 34,274,109 2,025,688 1,167 1,136 12/31/2017 Source: 2018 Retail Mobility www.publix.com Insights Report,” from Oracle Retail Source: Company reports unless otherwise noted E: Estimate, M: Media reports, R: Retail ops only, C: Results in Canadian dollars, NA: Not available, *: (472); Amazon Books (13)

CHAINSTOREAGE.COM SEPTEMBER/OCTOBER 2018 09A 2017 2016 2017 Net 2016 Net 2017 2016 Revenue Revenue Income Income Store Store [000] [000] [000] [000] Count Count

16 Apple Inc. ER Cupertino, Calif. 31,059,744 23,153,800 NA NA 502 497 9/30/2017 www.investor.apple.com

17 Macy’s Inc. Cincinnati, Ohio 24,837,000 25,778,000 1,547 619,000 852 829 2/3/2018 42% www.macys.com of retailers 18 Dollar General Corp said that Goodlettsville, Tenn. 23,471,000 21,986,600 1,538,960 1,251,100 14,534 13,320 faster delivery 2/2/2018 www.dollargeneral.com of online 19 H-E-B orders is their San Antonio 23,000,000 23,000,000 NA NA 340 329 top customer- 10/31/2017 facing priority, www.heb.com and many 20 Starbucks Corp. Seattle, Wash. 22,386,800 21,315,900 2,884,700 2,817,700 27,339 24,464 plan to use 10/1/2017 physical www.starbucks.com stores to 21 Dollar Tree Chesapeake, Va. achieve 2/3/2018 22,245,500 20,719,200 1,714,300 896,200 14,835 14,334 that goal. www.dollartree.com Omnichannel 22 Rite Aid Corp. Camp Hill, Pa. services 3/03/2018 21,528,968 32,845,073 943,470 405,300 2,550 4,536 such as buy www.riteaid.com online, pick up 23 Pilot Flying J in-store are Knoxville, Tenn. 12/31/2017 20,000,000 19,620,000 NA NA 750 750 an in-store www.pilotflyingj.com

priority for 24 Kohl’s Corp. 21%; 15% cite Menomonee Falls, Wis. 2/3/2018 19,095,000 18,686,000 859,000 556,000 1,158 1,169 ship-from- www.kohlscorporation.com store as a 25 Verizon Wireless ER fulfillment Basking Ridge, N.J. 12/31/2017 18,889,000 17,515,000 NA NA 1,700+ 1,700+ priority. www. verizonwireless.com Source: “State of Retailing Online,” from 26 7-Eleven (US and Canada) E Forrester and the NRF) Dallas 2/28/18 18,519,000 14,962,000 NA NA 9,700 8,707 www.7-eleven.com

27 Sears Holdings Corp. Hoffman Estates, Ill. 1/28/2017 16,702,000 22,138,000 -383,000 -2,221,000 1,002 1,430 www.searsholdings.com

28 E Grand Rapids, Mich. 2/3/2018 16,600,000 16,000,000 NA NA 242 230 www.meijer.com

29 Wakefern Food Corp. Keasbey, N.J. 10/1/2017 16,300,000 16,000,000 NA NA 196 275 www.shoprite.com

Source: Company reports unless otherwise noted E: Estimate, M: Media reports, R: Retail ops only, C: Results in Canadian dollars, NA: Not available

10A SEPTEMBER/OCTOBER 2018 CHAINSTOREAGE.COM 2017 2016 2017 Net 2016 Net 2017 2016 Revenue Revenue Income Income Store Store [000] [000] [000] [000] Count Count

30 Gap Inc. San Francisco 15,855,000 15,516,000 848,000 676,000 3,594 3,659 2/3/2018 www.gap.com

31 Nordstrom Seattle 15,137,000 14,498,000 437,000 354,000 366 349 2/3/2018 www.nordstrom.com

32 The Sherwin-Williams Co. Cleveland 14,985,000 12,215,757 1,944,000 1,887,000 4,620 4,180 12/31/2017 www.sherwin-williams.com

33 E Batavia, Ill. 14,664,780 12,650,000 NA NA 1,750 1,600 12/31/2017 www.aldi.us

34 Supervalu Eden Prairie, Minn. 14,157,000 10,912,000 45,000 650,000 114 2,363 2/25/18 www.supervalu.com

35 Ross Stores Dublin, Calif. 14,134,732 12,866,757 1,362,753 1,117,654 1,622 1,533 2/3/2018 www.rossstores.com AI spending 36 AT&T Wireless ER will reach Dallas 13,394,000 13,435,000 NA NA 2,200 2,900 12/31/2017 www.att.com $7.3 37 L Brands Inc. Columbus, Ohio 12,632,000 12,574,000 983,000 1,158,000 3,075 3,074 billion 2/3/2018 www.lb.com annually by 2022—up 38 J.C. Penney Co. from an Plano, Texas 12,506,000 12,547,000 68,000 24,000 872 1,013 2/3/2018 estimated www.jcpenney.com 39 BJ’s Wholesale Club $2 Westborough, Mass. 12,495,995 12,095,302 50,301 44,224 215 210 2/3/2018 www.bjs.com billion in 2018. 40 Bed Bath & Beyond Inc. Union, N.J. 12,349,301 12,215,757 424,858 685,108 1,552 1,546 Spending will 3/3/2018 www.bedbathandbeyond.com be strongest in customer 41 Hudson’s Bay Company C Toronto, Ontario service and 11,553,815 11,079,450 -467,821 -392,160 483 480 2/3/2018 www.hbc.com sentiment analytics 42 Southeastern Grocers Jacksonville, Fla. (54%). 11,484,200 10,500,000 NA NA 704 730 12/31/2017 Source: “AI in Retail: www.bi-lo.com Disruption and Opportunities 2018- 43 Trader Joe’s E 2022,” from Juniper Monrovia, Calif. 10, 995,660 10,290,540 NA NA 475 460 Research 6/30/2018 www.traderjoes.com

Source: Company reports unless otherwise noted E: Estimate, M: Media reports, R: Retail ops only, C: Results in Canadian dollars, NA: Not available

CHAINSTOREAGE.COM SEPTEMBER/OCTOBER 2018 11A 2017 2016 2017 Net 2016 Net 2017 2016 Revenue Revenue Income Income Store Store [000] [000] [000] [000] Count Count

44 Menards E Eau Claire, Wis. 10,950,000 9,500,000 NA NA 300+ 300+ 12/31/2017 www.menards.com

45 Autozone Memphis, Tenn. 10,888,676 10,635,676 1,280,869 1,241,007 5,814 5,609 8/27/2017 www.autozone.com

46 Office Depot Boca Raton, Fla. 10,240,000 11,021,000 181,000 529,000 1,394 1,441 12/30/2017 www.officedepot.com

47 Hy-Vee M West Des Moines, Iowa 10,000,000 9,600,000 NA NA 245 240 9/30/2017 www.hy-vee.com

47 Wawa M Wawa, Pa. 10,000,000 9,141,000 NA NA 800 756 12/31/2017 www.wawa.com

On average, 49 Quik Trip M Tulsa, Okla. 9,709,700 9,367,800 NA NA 783 754 4/30/2017 41% of www.quiktrip.com consumers 50 eBay Inc. receive San Jose, Calif. 9,567,000 8,979,000 -1,012 7,285 0 0 12/31/2017 between www.ebay.com

one and two 51 T-Mobile ER packages Bellevue, Wash. 9,380,000 8,553,000 4,536,000 1,460,000 2,200 2,000 12/31/2017 from www.t-mobile.com Amazon 52 Advance Auto Parts per week. Roanoke, Va. 9,373,784 9,576,679 475,505 459,622 5,183 5,189 12/30/2017 www.advanceautoparts.com of 44% 53 GameStop Corp. consumers Grapevine, Texas 9,224,600 8,607,900 34,700 353,200 7,276 7,535 2/3/2018 have used www.gamestop.com some kind 54 O’Reilly Automotive of same- Springfield, Mo. 8,977,726 8,593,096 1,133,804 1,037,691 5,019 4,829 12/31/2017 day delivery www.oreillyauto.com service in 55 Inc. E the past 8,900,000 9,300,000 NA NA 415 400 year. 6/30/2017 www.gianteagle.com Source: “Future of Retail 2018,” from 56 QVC Walker Sands West Chester, Pa. 8,771,000 8,682,000 972,000 642,000 2 2 12/31/2017 www.qvc.com

57 Food Markets Rochester, N.Y. 8,700,000 8,300,000 NA NA 97 93 12/31/2017 www.wegmans.com

Source: Company reports unless otherwise noted E: Estimate, M: Media reports, R: Retail ops only, C: Results in Canadian dollars, NA: Not available

12A SEPTEMBER/OCTOBER 2018 CHAINSTOREAGE.COM 2017 2016 2017 Net 2016 Net 2017 2016 Revenue Revenue Income Income Store Store 42% [000] [000] [000] [000] Count Count of Gen Z

58 Army & Airforce Exchange Service shoppers Dallas 8,600,000 8,300,000 376,000 384,000 2,700 2,700 (those ages 2/3/2018 www.aafes.com 18-22) prefer

59 Dick’s Sporting Goods to shop Coraopolis, Pa. 8,590,472 7,921,981 323,445 287,396 845 797 in-stores vs 2/3/2018 www.dickssportinggoods.com online, a further 60 Casey’s General Stores Ankeny, Iowa 8,391,124 7,506,587 317,903 177,485 2,073 1,978 4/30/2018 www.caseys.com 34% prefer to 61 PetSmart E Phoenix 8,310,000 7,000,000 NA NA 1,600 1,500 shop in- 1/31/2017 www.petsmart.com stores and online 62 IKEA North America E Conshohocken, Pa. 8,278,469 6,789,000 NA NA 56 55 equally, and 8/31/2017 www.ikea.com

63 Foot Locker 23% 7,782,000 7,766,000 284,000 664,000 3,310 3,363 percent 3/2/2018 www.footlocker.com prefer online only. 64 Staples Framingham, Mass. 7,630,000 18,247,000 NA -1,497,000 1,185 1,583 Source: Profitect 1/28/2018 www.staples.com

65 Bass Pro Shops Springfield, Mo. 7,340,000 4,600,000 NA NA 177 94 12/31/2017 www.basspro.com

66 Tractor Supply Co. Brentwood, Tenn. 7,256,382 6,779,579 422,599 437,120 1,853 1,738 12/31/2017 www.tractorsupply.com

67 WinCo Foods M Boise, Idaho 7,020,000 6,500,000 NA NA 119 119 3/31/2018 www.wincofoods.com

68 Ascena Retail Group Mahwah, N.J. 6,649,800 6,995,400 -1,313,800 93,800 4,807 4,906 7/30/2017 www.ascenaretail.com

69 Dillard’s Little Rock, Ark. 6,261,493 6,256,971 221,324 169,220 292 293 2/3/2018 www.dillards.com

70 Signet Jewelers Ltd. Hamilton, Bermuda 6,253,000 6,408,400 486,400 531,300 704 751 2/3/2018 www.signetjewelers.com

71 Cumberland Farms M Framingham, Mass. 6,178,798 6,201,000 NA NA 600 566 9/30/2017 www.cumberlandfarms.com

Source: Company reports unless otherwise noted E: Estimate, M: Media reports, R: Retail ops only, C: Results in Canadian dollars, NA: Not available

CHAINSTOREAGE.COM SEPTEMBER/OCTOBER 2018 13A 2017 2016 2017 Net 2016 Net 2017 2016 Revenue Revenue Income Income Store Store 51% [000] [000] [000] [000] Count Count of shoppers 72 Burlington Coat Factory who used Burlington, N.J. 6,084,766 5,590,950 384,852 215,873 629 592 2/3/2018 buy online, www.burlingtoncoatfactory.com pickup in-store at 73 Ulta Beauty Bolingbrook, Ill. 5,884,506 4,854,737 555,234 409,760 1,074 974 least two 2/3/2018 www.ulta.com times in the past 74 Tapestry New York City 5,880,000 4,488,300 397,500 591,000 1,332 1,043 12 months 6/30/2018 made www.tapestry.com unplanned 75 Racetrac Petroleum E Atlanta 5,572,320 7,900,000 NA NA 481 550 purchases 12/31/17 when they www.racetrac.com went to 76 Sheetz E Altoona, Pa. 6,689,020 6,741,200 NA NA 568 550 retrieve 9/30/2017 their order. www.sheetz.com On average, 77 Ace Hardware Oak Brook, Ill. 5,388,400 5,125,500 147,400 161,200 4,418 4,363 shoppers 12/30/2017 spent www.acehardware.com 78 Michaels Stores Irving, Texas 5,361,960 5,197,292 390,498 378,159 1,371 1,367 $40 2/3/2018 more on www.michaels.com unplanned 79 AVB Brandsource purchases Tustin, Calif. 5,350,000 5,221,000 NA NA 2,953 2,933 12/31/2017 when www.brandsource.com

making a 80 Williams-Sonoma click-and- San Francisco 5,292,359 5,083,812 259,545 305,387 631 629 1/29/2017 collect www.williams-sonoma.com pickup. 81 Big Lots Inc. Source: “The Rise of Columbus, Ohio 5,270,980 5,200,439 189,832 152,828 1,416 1,432 the Click and Collect 2/3/2018 Superconsumer,” from www.biglots.com OrderDynamics 82 Under Armour Baltimore 4,976,553 4,825,335 -2,272,000 -12,308 295 241 12/31/2017 www.underarmour.com

83 Hobby Lobby Oklahoma City, Okla. 4,910,000 4,300,000 NA NA 791 740 12/31/2017 www.hobbylobby.com

84 Academy Sports & Outdoors Katy, Texas 4,900,000 4,700,000 NA NA 245 230 12/31/2017 www.academy.com

85 Defense Commissary Agency Fort Lee, Va. 9/30/2017 4,900,000 5,250,000 NA NA 238 238 www.commissaries.com

Source: Company reports unless otherwise noted E: Estimate, M: Media reports, R: Retail ops only, C: Results in Canadian dollars, NA: Not available

14A SEPTEMBER/OCTOBER 2018 CHAINSTOREAGE.COM 2017 2016 2017 Net 2016 Net 2017 2016 Revenue Revenue Income Income Store Store [000] [000] [000] [000] Count Count 86 Speedway LLC 12/31/2017 4,900,000 5,010,000 NA NA 2,744 2,733 Erin, Ohio www.speedway.com

87 Luxottica Group (North America) R Port Washington, N.Y. 4,735,400 4,819,500 NA NA 4,438 4,708 12/31/2017 www.luxottica.com

88 Wayfair Boston 4,720,895 3,380,360 -244,614 -194,375 NA NA 12/31/2017 www.wayfair.com

89 Discount Tire Scottsdale, Ariz. 4,720,000 4,340,000 NA NA 975 944 12/13/2017 www.discounttire.com

90 Neiman Marcus Dallas 4,705,993 4,949,472 -531,759 -406,110 82 86 7/29/2017 www.neimanmarcus.com Three times 91 Sprouts Farmers Market as many Gen San Bernardino, Calif. 4,664,612 4,046,385 158,440 124,306 285 253 Z shoppers 12/31/2017 (ages 13-22)

92 Smart & Final Stores said they Commerce, Calif. 4,570,565 4,341,795 -138,914 12,948 323 305 shop mostly 12/31/2017 www.smartandfinal.com in stores, compared 93 Modesto, Calif. 4,500,00 4,200,000 NA NA 214 207 to those 12/31/2017 www.savemart.com shopping mostly online. 94 Belk Charlotte, N.C. 3,700,000 NA NA 294 293 1/31/2018 4,290,000 www.belk.com 54% of GenZers 95 Stater Bros. Markets E San Bernardino, Calif. want control 4,200,000 NA 171 169 9/28/2017 4,254,900 NA www.staterbros.com over what information 96 Petco Animal Supplies M they share, but San Diego 4,100,000 1,502 1,500 1/31/2018, 4,170,000 NA NA www.petco.com 61% 97 Tiffany & Co. also said they New York City 4,001,800 315 313 1/31/2018 4,169,800 370,100 446,100 www.tiffany.com would feel comfortable 98 Ingles Markets Black Mountain N.C. sharing more 3,794,977 54,189 199 201 9/30/2017 4,002,700 53,874 information www.ingles-markets.com if they knew 99 Price Chopper/Golub Corp. E data is Schenectady, N.Y. 3,500,000 135 137 4/30/2017 3,800,000 NA NA protected www.pricechopper.com and securely 100 American Eagle Outfitters stored. Pittsburgh 3,795,549 3,609,865 204,163 212,449 1,047 1050 1/28/2017 Source: National Retail www.ae.com Federation and IBM's Institute for Business Value Source: Company reports unless otherwise noted E: Estimate, M: Media reports, R: Retail ops only, C: Results in Canadian dollars, NA: Not available

CHAINSTOREAGE.COM SEPTEMBER/OCTOBER 2018 15A