Spending, with caution
Consumers carted out flat-screen TVs, loaded up on the latest Elmo toys and raced to grab designer shoes Friday as retailers across the country anxiously held their breath.
It was the traditional start of the holiday shopping season, complete with the usual predawn rush, “door-buster” deals and jaw-dropping bargains.
But this was no ordinary Black Friday, as all eyes were on the nation’s cash registers and what they would hold for the faltering U.S. economy.
Amid a rising unemployment rate, prolonged housing crisis and volatile stock market, this year’s shopping season is expected to be one of the worst in decades. Analysts are predicting a wave of retail bankruptcy filings early next year.
Even as many shoppers awoke before dawn for a long day of heavy discounts, they harbored fears about job stability and mortgage payments.
“I feel like I should not be shopping today, honestly,” said Maria Chapman, 50, at Fashion Island in Newport Beach. “I’m only buying things that are necessary.”
This year’s Black Friday also was marked by tragedy. At a Wal-Mart store on Long Island, N.Y., a store employee was trampled to death by hordes of shoppers, police said. And at a Toys R Us in Palm Desert, gunfire broke out inside the store, leaving two people dead.
The holidays are a crucial time for retailers -- sales from November and December usually make up 25% to 40% of annual revenue. It was too soon to tell whether Friday was a success; early sales figures are expected next week.
Holiday sales grew 2.4% to $460.2 billion last year compared with the previous year, according to the National Retail Federation. Many retail experts are now saying that if this season’s sales figures are comparable, it will be a good year.
And although thousands of shoppers hit the stores across Southern California, industry experts worried it still wasn’t enough to save Christmas.
“I don’t think the holiday has a chance at all. No way,” said Marshal Cohen, chief industry analyst at market research firm NPD Group. “This year, that spirit is gone.”
Desperate for a strong day of sales, retailers took no chances and opened their stores earlier, slashed prices even further and offered discounts on entire purchases.
“Everything seems like it’s 50% off or 2 for 1, or they’re running specials until noon,” said Jackie Fernandez, a retail partner at accounting firm Deloitte & Touche, who was at Glendale Galleria to survey the action. “It’s just endless.”
Norma Zuniga, a first-time Black Friday shopper, emerged from a Wal-Mart in Rancho Cucamonga shortly after its 5 a.m. opening with 42-inch and 32-inch high-definition televisions and a Nintendo DS game console -- all for $1,000.
That was quite a bargain for her. The day before, Zuniga had paid $1,200 for a single Sony HDTV at the store -- then returned it when she heard about the Black Friday deals.
She got in line at 8:30 p.m., armed with blankets. By 4:30 a.m. Friday, thousands of people stood outside the store.
“I’m glad I waited,” Zuniga, a payroll manager from Mira Loma, said. “I tried to go back and get a camera and there was so many people in electronics you couldn’t even move. So I gave up on that.”
Analysts said this was one of the most cutthroat Black Fridays in recent history as retailers competed to win over tight-fisted shoppers.
“We’ve been planning all year to be very aggressive this season, and we’re going to continue doing that all the way to Christmas,” said Jerry Storch, chief executive of Toys R Us, which opened at 5 a.m. with deeper discounts and more “door-buster” specials than usual.
Disney Store opened half its roughly 230 U.S. and Canada locations at midnight, up from just 5% last year.
“By opening at midnight we are fighting for our share,” said President Jim Fielding, who noted that lines formed at all midnight locations. “It seemed to be the right strategy.”
Among this year’s hottest Black Friday items: flat-screen televisions, GPS navigational systems, digital cameras, cashmere sweaters and video game systems, according to the National Retail Federation.
At the Saks Fifth Avenue in Beverly Hills, Layla Yasharal, 18, was jostled by crowds of shoppers aiming to buy heavily discounted designer merchandise.
“The second I got there, I almost fell,” she said. “People were taking shoes and handbags from each other’s hands.”
Yasharal ended up spending $250 on two pairs of True Religion jeans and a jacket before heading to Beverly Center, where she bought two pairs of shoes at Macy’s and gift sets from Bath & Body Works.
The big bargains -- one pair of heels was marked down to $35 from $89, and a pair of platforms was $94 less than the sticker price -- helped assuage her guilt over spending so freely, she said.
“I didn’t plan on spending so much, but the prices are so good,” the Santa Monica College student said. “I probably won’t go shopping for a while now.”
Fernandez questioned the profitability of such extreme price cuts.
“The real question is: Are the retailers making money off this type of spending?” she said. “It is really promotional and discount-oriented, so what’s their margin?”
Many consumers are sharply cutting their holiday budgets this year, which will further hurt retailers that are struggling to emerge from a months-long sales slump.
Taityana Benson, 27, said she usually spends about $1,000 on gifts for family and friends but is cutting back to no more than $500 this year -- and all of it will go toward her 3-year-old daughter.
“I can’t afford to shop for myself,” Benson said while waiting Thursday night for the Kids Supercenter at Citadel Outlets to open at 11 p.m. “Everything has to go to my child.”
After he and his staff members visited dozens of stores across the country Friday, Britt Beemer, chairman of consumer behavior firm America’s Research Group, said he was stunned by how discount-driven consumers were.
“I just can’t believe how many people were only going to buy the deals,” Beemer said. “These consumers were on a mission from God to get a deal, and that was it.”
Of course, there were still those who bought as they pleased.
At South Coast Plaza in Costa Mesa, John Zhang, 21, bought a jacket and pair of shoes from Dolce & Gabbana and a $512 Louis Vuitton scarf for his girlfriend.
“If you really want it,” he said, “the price really doesn’t matter.”
Many experts said a successful Black Friday would probably be but a brief bright spot in an otherwise bleak holiday season, rather than a turnaround for retailers.
Brent Schoenbaum, another retail partner at Deloitte, said consumers may just want to feel good. “There’s a lot of negative economic news out there,” he said. “And sometimes people like to buy their way into a little happiness.”
Times staff writers Tiffany Hsu, Catherine Ho, Joanna Lin and Nathan Olivarez-Giles contributed to this report.