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TECHNOLOGY: CLOUD COMPUTING LIFTS AMAZON B4
BUSINESS &FINANCE
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THE WALL STREET JOURNAL.
DJ TRANS À 2.12%
WSJ $ IDX À 0.21%
Monday, November 28, 2016 | B1
LIBOR 3M 0.937 NIKKEI 18381.22 À 2.30%
Mobile Further Crowds Retail
Foot traffic dwindles
even more at malls
as consumers exploit
their online options
shopping centers was thinner
than the frenzied crowds of
years past after retailers offered
discounts earlier in November
and many of the promotions
also were available online.
Online spending on Thanksgiving and the following day,
known as Black Friday, increased nearly 18% to $5.27
billion compared with last
year, said Adobe Systems Inc.,
which analyzed data from 22.6
billion visits to retail websites.
More Americans think it is
“easier to shop from one’s couch
than to fight one’s way through
the mall,” Ray Harjen, a spokesman for RetailNext, an in-store
analytics firm, which reported
that the number of store visitors
fell nearly 11% on Black Friday
from a year ago and sales
dropped more than 10%.
The shift highlights the struggle traditional retailers face as
they strive to attract foot traffic
BY SARAH NASSAUER
Americans jumped on holiday deals over the weekend but
a larger slice of their spending
migrated online, often through
mobile devices, highlighting the
high-wire act that faces retailers tethered to stores.
A National Retail Federation
survey
released
Sunday
showed online spending during
Thanksgiving weekend grew at
the expense of store spending
for a straight second year. The
NRF survey estimates that
about 109 million people
shopped online, compared with
99 million in stores.
Foot traffic at malls and
From Bricks to Clicks
Online sales during the
Thanksgiving weekend
$8 billion
7
6
Cyber
Monday
5
4
3
Black Friday
2
1
0
2012 ’13 ’14 ’15 ’16*
Thanksgiving
*Through the end of Black Friday
Source: Adobe Systems
THE WALL STREET JOURNAL.
into their brick-and-mortar locations with deep promotions,
friendly staff and exclusive products, while investing billions to
become e-commerce experts to
fend off Amazon.com Inc. and
attract consumers who are more
willing to use their mobile
phones to snag deals.
The deeply promotional climate that started as early as
October, combined with some
deflationary pressure, led average spending to fall 3.5%
over the weekend, according to
the NRF survey, which estimated that 154 million people
shopped during the four-days.
The most popular time to
shop in store was Black Friday
after 10 a.m., according to the
survey.
Thanksgiving weekend has
become a mobile-buying inflection point. Amazon said sales
from mobile phones on this
year’s Black Friday beat last
year’s Cyber Monday and Black
Friday, and exceeded such sales
on Thanksgiving to become one
of the biggest mobile shopping
days on its site. Overall, Ama-
zon said orders were stronger
on Black Friday this year.
Wal-Mart Stores Inc. said
60% of Black Friday online orders came through mobile devices, up from 50% last year. According to Adobe, mobile
phones accounted for 55% of
website traffic on Black Friday,
and 36% of sales, up from 33%
of sales in 2015. “You have a lot
of people who are mobile for
the weekend while traveling,”
said Antonio Nieves, chief
operating and financial officer
for Bonobos Inc., a men’s clothing retailer that began as a
website.
The early Black Friday estimates don’t always align with
actual dollar-sales data compiled
later in the season, especially as
more shoppers spend before or
after the Thanksgiving week.
—Erin Ailworth, Kelsey Gee
and Laura Stevens
contributed to this article.
Drug-Price
RisesStick
Stubbornly
A carrier ship in Sabine Pass, Texas
BY JONATHAN D. ROCKOFF
Pfizer Inc. raised the list
price of Viagra by 13% in June.
Less than a week later, Eli Lilly
& Co. pushed up the price of
its competing pill Cialis by the
same percentage.
The companies, though rivals, followed a common industry practice: raising prices
almost in lockstep. For years,
they have taken increases on
their
erectile-dysfunction
drugs within weeks of each
other—sometimes on the same
day—keeping the list price of
each pill within a few dollars.
The practice highlights
what many see as a big problem in the drug industry: Even
when there is competition,
prices can continue to climb.
That is because patients tend
to stick with a drug that works
for them, and health insurers
and drug-benefit managers
sometimes have contracts for
drugs that prevent switching
to cheaper options.
“You’re not rewarded for
having a low price and for the
most part, the market doesn’t
punish a high price,” says Mick
Kolassa, who has advised
drugmakers and government
health programs on pricing.
The freedom to raise, rather
than slash, prices in the face of
competition is a big reason
why U.S. prescription-drug
spending has surged by close
to 10% on average annually in
recent years to $310 billion in
Please see VIAGRA page B2
Total 2016 U.S. natural-gas exports to top countries*
Mexico
Canada
26.5
Argentina
Other
16.7
Under
Armour
To Change
Its Shares
BY MIRIAM GOTTFRIED
The struggles of hedge
funds are creating surprising
opportunities in markets. One
of the surest may be in an unloved class of shares issued by
Under Armour.
As the end of the year approaches, hedge funds that
might
have
ANALYSIS seized opportunities to profit
from gaps between the implied value and
market value of certain stocks
are instead looking for shortterm trades to help them finish the year. Hedge funds are
up a modest 3.59% year to
date through Oct. 31, and
merger arbitrage funds have
risen 1.26%, according to HFR.
Both underperformed the S&P
500 over the period. Meanwhile, hedge funds experienced
net outflows of $51.4 billion.
As a result, shares of some
companies trade at sizable
discounts to their implied values. Shareholders of Time
Warner, for one, would reap a
20% annualized gain if AT&T’s
deal for the media company
were to close within a year.
That deal faces regulatory hurdles, but the bet in Under Armour is much simpler.
In March, the sportswear
company issued shares of a
new Class C stock to all existing shareholders. All the shares
have the same economic interest in the company. The difference is voting rights. The new
shares have no vote, unlike Under Armour’s Class A shares,
which each have one vote, and
its Class B shares—owned by
the company’s founder, which
each have 10. As of Friday, C
shares were trading at a 22%
Please see STOCK page B7
Includes Brazil, Portugal, Kuwait, Jordan,
United Arab Emirates, China, Dominican
Republic, Barbados and others
10.2
29.8
Sources: Energy Information Administration (data);
Lindsey Janies/Bloomberg News (photo)
INSIDE
THE WALL STREET JOURNAL.
U.S. Is Now a Natural-Gas Exporter
BY STEPHANIE YANG
AND ALISON SIDER
The U.S. has become a net
exporter of natural gas, further evidence of how the domestic oil and gas boom is reshaping the global energy
business.
The U.S. has exported an
average of 7.4 billion cubic
feet a day of gas in November,
more than the 7 billion cubic
feet a day it has imported, ac-
cording to S&P Global Platts,
an energy trade publisher and
data provider. Exports also
topped imports for a few days
in September, Platts reported.
It has been nearly 60 years
since the U.S. last shipped out
more natural gas than it
brought in annually, according
to the U.S. Energy Information
Administration.
The milestone comes less
than a year after restrictions
on most crude-oil exports
KEVIN HAGEN FOR THE WALL STREET JOURNAL
Huge Touch-Screen Tablets
Sneak Into the Workplace
W
hen Fox News introduced gigantic
touch-screen tablets
in its newsroom in 2013,
they became objects of derision. Today, the move looks
oddly prescient.
Gigantic
touch-screen
devices are
sneaking into
business,
KEYWORDS
CHRISTOPHER both as tools
MIMS
for customers
and to get serious work
done. No one has named
them yet, so I’ll suggest
three: Gigantopad. Megatablet. Ginormablet.
The devices—anything bigger than 13 inches, the size of
an iPad Pro—are interesting
for several reasons. First is
the diversity of their uses,
from the bowels of cruise
ships to your local
McDonald’s. The second is
that, unlike tablets and other
mobile touch-screen devices,
no one owns this category yet.
Third is the way these gi-
494.4
Chile
India
*Through August
882.5 billion cubic feet
See more at WSJMarkets.com
were lifted, allowing tankers
of crude to be freely shipped
overseas for the first time in
nearly half a century, and together they mark a significant
and potentially permanent
change in the way U.S. energy
flows around the world. Overseas producers now have to
deal with the growing clout of
the U.S. energy industry,
which is aggressively looking
to ramp up its global market
share to help offset a long pe-
RULES OF
LEADERSHIP
riod of low prices.
“It’s indicative of things to
come,” said Sid Perkins, managing partner at the brokerage
Ion Energy Group. Natural gas
is “going to be taking on the
characteristics of a globalmacro market, like crude,
where global factors will influence what happens to gas.”
A blast of cold weather
could cause heating demand
to rise and tip the U.S. back
Please see GAS page B2
BOEING FACES
ROUGH RULING
FROM WTO
TRADE, B3
ACT WITH
CONFIDENCE
Trading nearly 16 million times an hour,* the SPDR S&P
500 ETF has given investors the confidence they need
to get in, or out of, the market with ease.
Visit spdrs.com/spy to learn more
about SPDR S&P 500 ETF (SPY).
McDonald’s is testing gigantic touch-screen kiosks for ordering meals.
gantopads allow people to
interact with computers in
new ways. It’s the difference
between watching a show on
your mobile device and gathering the family around the
TV.
Until now, collaboration
on computing devices has
been through the devices;
think of a chat session or a
shared document.
On megatablets, collaboration happens with others,
in person, as participants
manipulate the device or
share their work. It’s a new
model of interaction, and in
the right circumstances, it
works beautifully.
In a sense, these ginormablets combine four devices
found in most office conferPlease see MIMS page B4
*Source: NYSE Arca, as of 9/30/2016.
ETFs trade like stocks, are subject to
investment risk, fluctuate in market
value and may trade at prices above
or below the ETFs net asset value. ETF
shares may not readily trade in all market
conditions. Brokerage commissions and
ETF expenses will reduce returns.
SPDR ® S&P 500 ® ETF Trust, an exchange
traded fund listed on NYSE Arca, Inc.,
seeks to track an index of large-cap
U.S. equity securities.
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