Peak Holiday Weekend Is a Dud for Merchants
NEW YORK --In what was supposed to be the biggest shopping weekend of the season, consumers flocked to the nation’s stores Saturday and Sunday but remained frugal despite heavy discounting and advertising blitzes.
The restrained spending in the final stretch before Christmas wasn’t the frenzy merchants had hoped for and cast a further pall on the shopping season, already expected to be the worst in at least a decade.
“This is supposed to be the ultimate peak Christmas shopping weekend, and I think it was even softer than Thanksgiving weekend,” said C. Britt Beemer, chairman of the Charleston, S.C.-based America’s Research Group.
Instead of the typical surge on the final weekend before Christmas, traffic and sales were up only slightly from the previous weekend and down from the same time a year ago, analysts said.
As a result, holiday sales and profits for many merchants may fall below already modest expectations, Jeff Feiner, managing director of Lehman Bros., said Sunday.
“The profit picture looks a lot worse,” Feiner said. “Traffic was still off for the most important weekend before Christmas, even with the rampant discounts.”
Retailers’ profits may now be down 5% to 10%, worse than the 3% to 5% declines Feiner had expected.
Feiner said his holiday forecast of a 2% gain in sales for the 22 stores he tracks may now be “a little too optimistic.”
Robert Mood, who does a daily workout at the Mall of America in Minneapolis, noticed thin crowds Saturday, typically the biggest day of the holiday shopping season.
“There’s a lot more room to move around,” he said.
The disappointing turnout last weekend is the latest blow to retailers, which have been suffering from sluggish sales since the shopping season began the day after Thanksgiving.
The only bright spots have been in consumer electronics, such as game consoles and DVD players, kitchenware and certain toys, including Harry Potter products. Value-oriented chains, particularly Wal-Mart Stores Inc., have fared much better than department stores and specialty apparel stores.
Marilyn Villano, 48, of Auburn, N.Y., used to procrastinate when it came to buying holiday gifts. This year, however, she finished shopping by Dec. 10.
“I just wanted to spend more time with my children and grandchildren,” she said.
Many merchants were counting on procrastinators. They included Kmart Corp., which is keeping the doors of its stores open from 6 a.m. Thursday to 8 p.m. Christmas Eve, or 110 hours. Last year, the Detroit-based retailer kept its doors open 66 hours straight.
Bloomingdale’s, also hoping to snag procrastinators, sent out an extra catalog to more than 1 million homes last week.
Bloomingdale’s Chairman Michael Gould said he was pleased with the overall weekend sales receipts, though revenue at the New York store was less than expected. Overall, holiday sales should be “fractionally above” its modest goals, he said.
Karen MacDonald, spokeswoman at Bloomfield Hills, Mich.-based Taubman Centers, which owns 31 malls around the U.S., said retailers that featured big promotions attracted the most shoppers.
