Maybe it was the deep discounts, maybe it was the colder weather and maybe it was just for the sport of it. Whatever it was, shoppers gave retailers something they were hoping for — a solid official start to the Christmas shopping season.
Now all that merchants, and the economy, need is for shoppers to maintain Black Friday’s frenzied buying pace from now until Dec. 25.
It’s a steep challenge. Consumers have been battered by a slew of problems: slumping home values, tighter credit and rising gas prices, among them. Those haven’t gone away.
But aggressive tactics — bigger discounts and expanded hours like midnight openings— apparently worked. Based on early reports, Macy’s, Inc., Toys “R” Us, K-B Toys Inc. and others that were noisy with discounts reported bigger crowds for the early morning bargains than a year ago. And electronic gadgets, particularly the hard-to-find Nintendo Wii, topped shoppers’ wish lists, though frustrations were high among shoppers who couldn’t get their hands on the limited bargains.
“I’m really looking for the bargains this year because I’m losing my job; they’re moving our plant to Mexico after the first of the year, so I have to be careful,” Tina Dillow of New Richmond, Ohio, who camped out at a Best Buy store near Cincinnati at 3 a.m. because of a great deal on a laptop. But she ended up empty handed.
“I stood in line until they finally let us in about 20 after 5, but I was really disappointed because I didn’t get one,” Dillow said.
C. Britt Beemer, chairman of America’s Research Group, said that tougher economic conditions are driving more shoppers to take advantage of early bird specials. “There were more bargain hunters this year,” he added.
Marshal Cohen, chief industry expert at NPD Group Inc. agreed, but he noted shoppers were buying selectively. Overall, the biggest draws were consumer electronics, including flat-screen TVs, digital cameras, digital frames, and laptops. In toys, which have been battered by recalls of a slew of lead tainted Chinese toys, there were plenty of hits including video games such as Activision Inc.’s “Guitar Hero III,” toys related to Walt Disney Co.’s “Hannah Montana” and Smart Cycle from Mattel Inc.’s Fisher-Price, toy executives said.
Janet Hoffman, managing partner of the North American retail division of the consulting firm Accenture, believes that some parents, concerned about toy safety, may shift their purchases away from toys to video games and children’s clothing. She added that sales of children’s clothing fared unusually well Friday.
And while mainstream department stores such as Macy’s and J.C. Penney Co., which hammered shoppers with big discounts Friday, seemed to pull in the crowds, traffic at mall-based apparel stores was disappointing, according to Wachovia Capital Markets LLC analyst John D. Morris. One problem is that there aren’t a lot of must-have fashions.
Macy’s chief executive, Terry Lundgren, said that 3,000 people started lining up at the Herald Square store at 5 a.m, forcing the store to open at 5:30 a.m., half hour earlier. That was up from about 2,500 people a year ago. Among some of the most popular early morning deals were Martha Stewart faux holiday trees, that were 50 percent off, and outerwear and sweaters, which were marked down by 40 percent to 50 percent.
“We all know that September and October were not great months, so there is some pent-up demand,” Lundgren said. “We feel encouraged by the early signs.”
Jerry Storch, chairman and CEO of Toys “R” Us Inc., which unveiled 101 early morning bargains, four times the number last year, reported 1,000 people waiting in line for the 5 a.m. opening at the Manhattan store, double the number a year ago.
Macy’s, Toys “R” Us and others with locations in big cities also enjoyed increased business from foreign shoppers reveling in exchange rates that made discounts even deeper.
Melissa O’Brien, spokeswoman at Wal-Mart Stores Inc., which offered such specials as a Polaroid 42-inch LCD HDTV for $798 and a $79.87 Sony digital camera, only said “we are excited about today.” Among the most popular items were flat-panel TVs, and various toys, particularly from the “Transformers” line. Special offers on GPS units and digital frames were selling “very fast,” she said.
Target Corp.’s spokeswoman Lena Michaud said traffic was strong based on a spot-check of stores. Gail Lavielle, spokeswoman at Sears Holdings Inc., which operates Sears, Roebuck and Co. and Kmart stores, reported traffic increases from a year ago.
Best Buy Co. drew more than a thousand shoppers to West Paterson, N.J. and to its Manhattan store for early morning bargains on Sony laptop computers, cut to $399.99 from $749.99, and GPS devices from TomTom for $119.99, from the normal $249.99, according to store managers.
Recognizing a potentially tough shopping season ahead, stores began discounting weeks ago, with such gimmicks as door busters and expanded hours. While top luxury stores such as Saks Fifth Avenue continue to do well, merchants that cater to middle and lower income shoppers have suffered as consumers struggle with higher gas and food prices as well as a slumping housing market.
While Black Friday is expected to be the busiest day of the season, it’s not a predictor of how retailers will fare in the season overall. In fact, the weekend only accounts for about 10 percent of overall holiday sales. But it does set the tone since what consumers see that day influences where they will shop for the rest of the year.
Now, stores are going to have to play a cat-and-mouse game, waiting to see how much more they need to discount to get shoppers back.
Barbara Jensen, of Omaha, who was shopping at a local J.C. Penney stores said she planned to save money by making fewer trips to stores and hoping that sale prices extend beyond Friday.
“I go in sections, that way I’m not using as much gas,” Jensen said. “I’m hoping that maybe there will be some good prices this year because of the retailers being afraid that people aren’t going to buy. I’m hoping that that will help.”