Desperate times call for deep discounts at the mall
With the sun breaking through after a storm and Christmas less than two weeks away, shoppers dutifully trooped to the region’s malls on Sunday -- though apparently with less free-spending enthusiasm than anxious merchants would like.
There was plenty of elbow room at Sherman Oaks Fashion Square, despite signs offering steep discounts.
“We’re Dropping Our Pants,” said a sign pledging 30% off the price of dungarees at Lucky Brand Jeans. Other store windows promised deep discounts (“50% Off Entire Store!”) and bargain prices (“Items for $4, $5, $6 and $7”) in the hopes of getting people to open their wallets.
It’s getting to be do-or-die for a lot of retailers as the seasonal shopping days dwindle. If Christmas doesn’t meet expectations, thousands of stores across the country are going to be forced to close in the first half of next year, according to real estate experts. Worried merchants are going all out to attract customers.
With sales generally moving along at about the same tepid pace as last year, many stores have taken aggressive steps in advertising, promotion and discounts, said retail industry analyst Jackie Fernandez of Deloitte & Touche.
“They’ve had to do quite a bit to get customers in,” she said. “A lot of retailers put most of the store on sale.”
That strategy makes sense at the end of a tough economic year that saw widespread job losses and falling incomes for many who still are employed. In more flush times, discriminating buyers made choices about where to shop based on assortment, service levels and other nonmonetary factors.
“All that’s gone,” Fernandez said. “Now it’s price, price, price.”
Discounts are everywhere, agreed shopper Stuart Wall on Sunday morning at Sherman Oaks Fashion Square. “Prices are crazy,” he said.
Wall, an adult movie producer, was sitting in one of the mall’s vibrating massage chairs waiting for LensCrafters to open. It was his sixth or seventh day of holiday shopping, he said, and he was at the mall mainly to buy some jewelry for his girlfriend and some pants for himself.
“Sixty- to 70-dollar jeans break down to $20 or $30 on sale and with a coupon at Macy’s,” Wall said.
He planned to spend less overall than last year, even though one of his company’s films is having a surge in sales because it features an actress who was romantically linked to golfer Tiger Woods.
Sales at a upscale jewelry store nearby in the mall are weak and lean more toward cheaper silver than gold, said employees, who asked not to be identified because they are not authorized to speak for the company. Shoppers commonly turn around and walk out when they find out nothing is discounted, they said.
“People are not buying,” one employee said.
Shopkeeper Peter Kartounian, who has been in the watch sales and repair business for 40 years, is getting used to more aggressive customers in his Tic Time store in Glendale Galleria.
“What’s on sale?” they ask him. “What kind of deal can I get?”
Potential buyers commonly try to bargain for prices even lower than those in a sale of up to 40% off.
“This year is more competitive,” Kartounian said. His sales are down as much as 30% from last Christmas, he said, but he’s holding out hope for a rush from last-minute shoppers. “The last eight to 10 days are usually the best.”
Merchants have had to make a bargain with the devil to keep sales churning, analyst Fernandez said. “They have conditioned consumers to think everything should be on sale,” she said, and must keep offering deals if they want to keep cash registers ringing.
Of course, not everyone demands a discount.
“It’s great if things are on sale, but I’m going to get people what they want,” said Jordan Woods of Newport Beach, who was shopping with his girlfriend at the Galleria. “Sales are a bonus.”
Girlfriend Bree Sarrow, a teacher from Valenica, was cashing in gift cards she’d received from some of her students at Stevenson Ranch Elementary School and keeping her budget under what she had spent in previous seasons.
“My whole family decided to scale back this year,” she said.
Also not demanding sale prices was Helmut Traitler, who held shopping bags full of new winter clothes while his wife shopped in Baby Gap for their grandchildren. The vice president of innovation at Nestle in Glendale said he is fortunate to be able to pick out gifts he wants for others and succumb to occasional “on-the-spot seduction” to buy something for himself.
Nationwide, holiday shopping seems to be “a bit tepid” so far, said Aaron Martin, a spokesman for ShopperTrak, a data provider for the retail industry.
The fact that a mall isn’t packed with shoppers doesn’t meant there aren’t sales, though, he said. Many people are doing research online and elsewhere before striking out in search of certain items.
“They figure out the exact stores they want to go to,” he said. “Window shopping is kind of down, and I don’t see that changing any time soon.”
As always, retailers can hope that last-minute shoppers will materialize, said Kathy Grannis of the National Retail Federation, an industry trade group.
“Last year, about 50% of shopping was done in the last two weeks,” she said. “We hear just as much procrastination is going on this year.”
