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E-commerce and Sandy: A Love-Hate Relationship

Image via American Apparel
Image via American Apparel

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If the Twitter backlash against American Apparel and other stores' Sandy-themed sales is any indication, talking about the numbers left many a bad taste in people's mouths, post-hurricane. But in Sandy's wake, e-commerce has emerged as one of the retail sector's only strategies for offsetting the sales hit brands took as their East Coast stores closed. Or, as an American Apparel spokesperson told Fashionista, "retail stores are the lifeline of a brand like ours so when they are closed, we need to come up with ways to make up for that lost revenue. People forget how expensive it is to run a Made in USA brand like American Apparel and if we made a mistake here it came from the good place of trying to keep the machine going–for the sake of our employees and stakeholders."

An analyst for Citigroup pegs retail sales loss due to a day or three of closing East Coast stores at "as much as 40 percent for the week in affected areas, and November comparable-store sales could be down by as much as 2 to 3 percent," reports the New York Times. While that's a tough blow for brands at the start of the holiday season, the general consensus culled from analysts and retail businesses is that the storm fell on a generally slow shopping day—Monday—and far enough in advance of the holiday push—Thanksgiving, Black Friday, etc.—that the drop was not as bad as it could have been.

At least stores with e-commerce can counter losses slightly: Fab.com and other e-tailers experienced "unusually strong volumes on Monday", according to the Huffington Post. So American Apparel was accurate in noticing that those who were home-bound would take advantage of online shopping (the company's slight lack of tact notwithstanding).

Still, it's not all smooth sailing from here. Brands' e-commerce platforms are obviously experiencing problems with order fulfillment. As Jason Goldberg, founder and chief executive of Fab.com, told HuffPo, "The biggest impact to us right now is that our warehouses have no power. We're doing everything humanly possible to send packages as quickly as possible."

Retail company's with a strong online eliminate like eBay, Gilt Groupe, Opening Ceremony, Bonobos, and Net-a-Porter were the first to connect with shoppers via Twitter and e-mail, warning users of probable delays in delivery dates and asking for their patience.
· American Apparel Responds To Backlash Over Sandy Sale [Fashionista]
· Awaiting the Storm's Price Tag [NY Times]
· Firms Begin to Assess Damages in Hurricane Sandy's Wake [WWD]
· Hurricane Sandy: Online Shopping Orders Delayed By Warehouse Power Outages [HuffPo]
· Twittersphere Is Not Happy About Sandy-Themed Sales [Racked]