Late Rush of Buying Expected
Shoppers are crowding U.S. malls and surfing Web sites this busy holiday weekend, but a nation of procrastinators will likely spend the bulk of its gift-buying budget the weekend before Christmas, economists said Saturday.
Early indications show that store traffic was good Friday, the launch of the holiday season. But last-minute shoppers and those looking for bargains are expected to fuel bigger sales the weekend before Christmas Day, which falls on a Monday.
“I think this season is going to start off slow and end up strong,” said William Ford, senior economic advisor for check acceptance company TeleCheck Services, a unit of First Data Corp. “People will have an extra Saturday and Sunday to shop this year and some will wait until then.”
Ford forecasts sales at stores open at least a year will rise 4% during the holiday season, compared with last year’s gain of about 7%. Factors slowing sales growth this year include higher interest rates on credit cards and mortgages, considerably higher costs for gasoline and home heating oil, and steep declines in most U.S. stock prices.
About 67.6 million shoppers visited U.S. malls Friday, up from 61.6 million the same day a year ago, according to data compiled by the National Retail Federation and Chicago-based retail consulting firm RCT.
The mall data, which do not include any information on sales, also revealed that shoppers started their day earlier, lured by the heavy discounts that retailers used to drive traffic into stores, said Rick Gallagher, publisher and editor-in-chief of Stores Magazine.
“I think the conclusion you draw is that the promotions were successful because they brought people out earlier and they stayed longer,” Gallagher said. Shoppers “probably bought in larger quantities.”
Wal-Mart Stores Inc., the world’s largest retailer, reported Friday’s sales totaled $1.1 billion, compared with sales slightly above $1 billion a year ago, a company spokesman said. The discounter, based in Bentonville, Ark., said sales growth at stores open at least a year, a key measure of retail performance, came in from 4% to 6%.
At The Mall at Short Hills, N.J., with its collection of upscale department stores and boutiques, some merchandise appeared to be marked down sooner this year than in the past, a mall spokesman said.
“It does seem like they are taking some promotions a little earlier this year than they have in years past,” said Tom McCracken, the mall’s general manager.
Discounts that lure customers into stores also cut into holiday profits. But that will not be known until retailers begin reporting weekly sales figures.
Some consumers avoided the crowds and did their shopping online.
Santa Clara-based Yahoo Inc., which hosts 10,000 merchants on its shopping site, reported that order volume doubled Friday when compared with a year ago.
“We’re expecting a strong holiday season based on the numbers we saw in early November,” Yahoo spokeswoman Jennifer Dulski said. “We also expect next week to be strong because online shopping tends to pick up during the week, when people are at the office.”
