Day-after deals lure shoppers
By Anne D'Innocenzio
Shoppers descended on stores and malls yesterday in search of post-Christmas bargains as retailers reduced prices further, hoping to recoup business in a season that will likely turn out to be only modestly better than a year ago.
Retailers are counting even more heavily on the week after Christmas to meet their sales goals, as two consecutive weekends of snow in the Northeast, a lack of must-have items, a sluggish job market and few early bargains dampened holiday shopping.
In particular, merchants are hoping that shoppers will be redeeming the ever-more-popular gift cards, which aren't recorded as final sales until they're used.
Wal-Mart Stores Inc. and other stores have blamed gift cards for artificially deflating holiday sales in the short-term.
Shoppers showed up early yesterday at stores and malls.
"It's fun. We do after-Thanksgiving, too, so people think we're crazy," said Paige Lohmeuller, who was shopping with her sister Blair Herndon at the Crabtree Valley Mall in Raleigh, N.C.
Their main purchase: maternity clothes for Herndon. Most had been purchased with a gift certificate that she received as a present.
Jim Jankowski arrived at the Rich's-Macy department store at Lenox Square Mall in Atlanta shortly after 7 a.m., but he wasn't taking advantage of the discounts of up to 75 percent. He was exchanging a dress he purchased for his wife.
"I got the wrong size," he said.
In Columbus, Ohio, shoppers started lining up outside a Target store at the Polaris shopping center just after 6:30 a.m. By the time the store opened a half-hour later, about 100 people were at the store's two entrances.
"You've got to move fast. That's why I'm wearing tennis shoes," said Christine Best, 33, of the Columbus suburb of Delaware. "They slash prices on everything Christmasy. I'm headed straight for the wrapping paper."
At Macy's Herald Square in Manhattan, Marcia Kelly and her husband, Manton Kelly, of the Bronx, had come with a mission: to find a bargain on a coat. They snapped up a nylon Kenneth Cole Reaction jacket for him.
"I got a good deal, 50 percent off," he said.
This holiday season, high-end stores such as Neiman Marcus, Nordstrom and Sharper Image have enjoyed robust sales, while mid-priced department stores have fared the worst. Even discounters such as Wal-Mart Stores Inc. have struggled with muted sales gains, as lower-income consumers still haven't benefited from the economic recovery.
In fact, despite a sales spurt over the last weekend and final days before Christmas, Wal-Mart said yesterday that same-store sales growth through Dec. 24 continues to be tracking at the low end of its projected range of 3 percent to 5 percent.
Same-store sales or sales at stores open at least a year are considered the best indicator of a retailer's health.
"Customers are shopping and decorating really late, with trees, ornaments and gift-wrap purchased later than ever in the season," the company said in a pre-recorded call.
But upscale retailer Sharper Image raised its earnings outlook for the fourth quarter and full year yesterday because of what the company described as "outstanding preliminary" holiday sales.
The final holiday same-store sales picture will not be known until Jan. 8 when the nation's retailers report their December same-store sales results.
Online sales have remained a bright spot.
Amazon.com said yesterday that it had its busiest holiday season, during which it set a single-day record with more than 2.1 million units ordered, or 24 items per second, worldwide. A company spokesman declined to name the date.
Bluefly.com, which sells discounted designer clothing online, had a sales increase of more than 35 percent during the period between Thanksgiving and Dec. 22, reaching the high end of its projections, according to chief executive Ken Seiff.
The week after Christmas has become increasingly important. A year ago, the period accounted for 11.8 percent of holiday sales, up from 10.6 percent in 2001.
Analysts believe that figure will be higher this year, citing the increasing popularity of gift cards. Stores also are counting on consumers buying regular-priced merchandise when they redeem the cards, boosting profit margins for the fourth quarter, which typically ends at the end of January.
Gift-card sales for this holiday season are expected to account for up to 10 percent of holiday business, according to Ellen Tolley, a spokeswoman at the National Retail Federation.
"Gift cards were a great last-minute alternative," said Tolley. But if consumers wait until January or February to redeem them, she said, that could "distort holiday sales figures," making them weaker than they actually are.
Wal-Mart said the amount of money placed on gift cards this season is up more than 20 percent from last year.
Karen MacDonald, a spokeswoman at The Taubman Centers Inc., which owns and manages 31 shopping centers in 13 states, said a sampling of mall stores yesterday showed that consumers are spending from 10 percent to 25 percent over the value of their gift cards.
Retailers are hoping there won't be many consumers like Miriam Molina of Brooklyn, who said she doesn't plan to redeem her J.C. Penney gift card right away but aims to use it to buy spring clothes and shoes.
"I usually hold onto to it," said Molina, who was at the Macy's Herald Square store hunting for holiday ornaments. "In the past, I've used it about four months later."