Following a lukewarm shopping weekend, the nation’s stores are now focusing their attention on the final week leading to Christmas, as consumers seem to be postponing more of their buying to the last minute compared to a year ago.
Just as malls and stores ushered in the official start of the holiday season with expanded hours and generous discounts, they plan to do the same in the final stretch. Macy’s Inc. plans to pull all-nighters at several of its stores, including its Manhattan flagship, starting Friday. Toys “R” Us plans to keep its doors open until midnight every day until Dec. 24.
Based on early reports from analysts and malls on Sunday, sales results were generally unimpressive this past weekend, as shoppers were held back by a snow storm that spread a mix of sleet, freezing rain and snow from the Great Lakes states to New England. Consumers, fretting about economic worries, were also delaying their shopping even more this year, knowing there’s a full weekend before Christmas, when the bargains will be even better.
Meanwhile, for online retailers, which likely finished their busiest days last week, their fate appears to be already sealed: Holiday sales didn’t live up to industry’s hopes as lower-income shoppers pulled back on spending amid a housing slump. ComScore Inc. reported Sunday that online sales from Nov. 1 through Dec. 14 rose 18 percent — less than the 26 percent growth rate seen in the same period a year ago and the 20 percent projection for the season.
“This holiday season at this point has been disappointing, whether they’re brick and mortar, catalog or online,” said C. Britt Beemer, chairman of America’s Research Group, based in Charleston, S.C. “Shopper are more frugal and cost-conscious because they have less money to spend.” As for Saturday and Sunday, he said, “This weekend was busy, but it wasn’t huge.”
Bill Martin, co-founder of ShopperTrak RCT Corp., was more upbeat, noting that the fate of the holiday season depends on the final stretch, predicting business in the final days will be “huge.” According to ShopperTrak, five of the remaining days left until Christmas account for the biggest sales days of the season.
Shoppers at malls over the weekend seemed to be taking their time.
“I think there’s better deals now,” said Mike Weigel of Shoreview, Minn. He just started holiday shopping and was on the hunt for a plasma TV while at the Mall of America in Bloomington, Minn., Friday afternoon.
“I always like to wait until the panic rush,” said Michelle Williams of Kingwood, Texas, who was at the Woodlands Mall near Houston. She had just started Friday night. “I want to get it all done this week,” he added.
After a strong Thanksgiving weekend, the official start of the holiday shopping season, business has slowed even more than normal, resulting in mixed November results for retailers and uneven business so far in December. There’s been a shopping frenzy surrounding such hard-to-find items as Nintendo Co.’s Wii and UGG Australian sheepskin boots, and anything from Walt Disney Co.’s Hannah Montana and “High School Musical” franchises have been hugely popular. But generally there seems to be a lack of enthusiasm for holiday buying.
“I am trying to get almost everybody done in one shot, type of thing, because I am pretty busy with school and work and stuff. So I’m basically tired,” said Melissa Browne-Smith, who was at Stonestown Mall in San Francisco on Saturday night.
Plenty of retailers are getting anxious, offering last-minute enticements to spur sales. Toy seller FAO Schwarz added a free standard shipping and 25 percent discount offer on all goods ordered at fao.com through Tuesday. Others resorted to even more desperate means. On Saturday, a sales clerk outside a midtown Manhattan location of Lane Bryant, a large-size clothing chain, was seen blasting “40 percent discounts” using a bull horn.
Store executives say consumers are even more savvy about buying this season, doing a lot of their homework before they grab deals. This year, the economy, particularly the housing crisis, has hurt shoppers’ spending.
“I got laid off from my job in the mortgage industry,” said Janina Kosloski of Orange County, Calif., who was visiting relatives in Minnesota. “Right now, I’m basically scared of losing my house.”
That’s forced her to cut her holiday spending by half as she scours for bargains. She noted that she recently bought “Sopranos” DVDs at deepdiscount.com, at a price much cheaper than other outlets.
FAO Schwarz CEO Ed Schmults said it was too early to tell how shoppers responded to his company’s last-minute free shipping offer but added, “We are still looking at next weekend to be a big weekend.”
He noted that this past weekend, the toy retailer, which operates stores in Manhattan and Las Vegas and a shop at Macy’s in Chicago, had solid sales on the Internet but weaker sales in Las Vegas and New York, though business was strong at its Macy’s outpost.
Toys “R” Us Chairman and CEO Jerry Storch said business was “satisfactory” this past weekend, and he is clearly seeing “steady increases in business.” Only a handful of its stores had to close early because of the winter storm, he said.
Karen MacDonald, spokeswoman at Taubman Inc., which operates 24 malls in 11 states, said that based on a spot-check of malls, stores reported business that ranged from unchanged to an increase of low single digits for the past week compared with the same period a year ago. For the weekend, business was up low to mid single digits versus a year ago. Among the hot sellers are UGG boots and gift cards, she said.
Tina McCuddin, vice president of marketing of Macerich Co., which operates 73 malls in 18 states, reported that the latest weekend’s business was level with the prior weekend. She added that sales this weekend were hurt in part by the storm, but generally shoppers are taking their time.
“We have had a couple of quieter weeks since Black Friday,” she said.