Getting into last-minute mode
Procrastinators will get a bonus this year: an entire weekend to shop in the final hours leading up to Christmas. And retailers are ready and eager.
“That Friday-Saturday combination will be pretty powerful in terms of additional spending by consumers,” said Wayne Best, an economist for credit card company Visa USA.
Best predicted that Saturday, Dec. 23, would be the busiest shopping day of the year, followed closely by Friday, Dec. 22.
But even nine days before the holiday, retailers across the nation are in last-minute mode with a first round of bargains.
The National Retail Federation, the industry’s largest trade group, estimated Thursday that about half the consumers had completed their holiday shopping.
“Obviously, aggressive promotions will be everywhere,” said Ellen Davis, spokeswoman for the retail trade group in Washington.
April Luna likes the way that retailers slash prices during crunch time when push, sometimes literally, comes to shove.
“I do last-minute shopping,” said Luna, 33, a Huntington Beach resident who works for Best Buy Co. “I go for the sales.”
Some Southland retailers already have dusted off their 50% and 75% signs, while others are trying new enticements to pull shoppers into stores.
The Grove in Los Angeles is offering free valet parking for shoppers who can show that they spent at least $250 there. The Beverly Center is encouraging people to haul their pets to the mall Sunday for a “Santa Paws” snapshot, with either the traditional chubby version or the mall’s buffed-out “Hunky Santa.”
JC Penney stores will be open 6 a.m. to midnight today for an 18-hour holiday blowout sale, spokesman Tim Lyons said. That’s an hour earlier, and later, than last year. Stores will offer extra savings for early shoppers and night owls, he said. The same hours will be repeated the next Saturday.
“We know people will be out shopping,” Lyons said. “We’re just trying to make our offers as strong as possible so they’ll come to our store and shop with us.”
But stores that save their best deals for the final weekend will miss Fernette Jackson.
“I don’t like the crowds,” said Jackson, 45, of Hawthorne, who is also put off by the shopping season’s hype that encourages overspending.
“Then you spend the next few months trying to get out of debt,” she said. “It’s crazy.”
Neither will retailers snag Sue Bond, a teacher from Newport Beach who bought her last two presents Wednesday.
“My final gift -- right here,” she said, lifting a shopping bag while she waited for a passion tea at the Starbucks at South Coast Plaza in Costa Mesa. Last-minute shopping is “way too crazy and stressful.”
“I prefer to be in a state of equanimity as much as possible,” Bond said.
Irvine resident Eric Forsum maintained his equanimity by buying gifts online, except for the “wife shopping” he did Wednesday at high-end jeweler David Yurman. But Forsum, a Jack-in-the-Box franchise owner, does find last-minute shopping entertaining.
“I love watching on TV when people are fighting for a [parking] spot,” he said.
But as far as Britt Beemer is concerned, retailers aren’t doing enough to please shoppers. The chairman of America’s Research Group said his polls showed that consumers were disappointed that there weren’t more “big deals” being offered this year.
“They may be satisfying Wall Street,” he said of retailers, “but Main Street’s going to be very unhappy.”
Many stores and malls are just following the drill of previous years. And there’s no guarantee that the weekend at the end of the shopping season will be a boon to retailers.
The last three times Christmas fell on a Monday, the pace of sales growth actually slowed in the combined months of November and December, compared with the average gain in the first 10 months of the year, according to the International Council of Shopping Centers. The economy was in a slowdown in all three of those years: 1989, 1995 and 2000, said Michael Niemira, chief economist for the shopping center council.
Indicators so far show that retailers will enjoy solid but not extraordinary sales this season.
The National Retail Federation predicts that sales will rise 5% to $457.4 billion, compared with a 6.1% increase in 2005. Holiday sales are particularly important for retailers, who collect 20% to 40% of their annual revenues in the months of November and December. They’re also an important indicator for the economy. Consumer spending accounts for about 70% of the nation’s economy.
The indicators of how the season is playing out so far vary, depending on how the numbers are tallied.
Sales at stores open for at least a year advanced only 2.1% last month, down from a 3.8% gain in November 2005, according to the shopping center council. Excluding a decline at Wal-Mart, the industry recorded a 4% increase last month.
Using a broader measure from the Commerce Department, retail sales, excluding those for automobiles and gasoline, rose a better-than-expected 6.4% compared with the previous year. That growth pace was better than October’s 5.5% increase, but slower than any other month this year. The average advance for the first nine months of the year was 7.7%.
“There’s been a downshift in spending by consumers since the summer months,” said Best of Visa, which tracks spending on credit cards. “The first 10 days of December it appears that people are getting back into that holiday spending mood. We’ve seen upticks in nearly all categories.”
Economists say that lower gasoline prices, a strong job market and rising personal income are helping to drive spending. On average, personal income has grown 6.5% in the first 10 months of the year, compared with the same period in 2005, Niemira said. Since 1990, the average growth rate has been 5.2%.
“The implication is extremely important,” Niemira said. “The consumer has the wherewithal to spend and they have been spending pretty aggressively through much of 2006.”
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