Holiday sales start strong but doubts persist
NEW YORK - US shoppers, lured by discounts of as much as 70 percent, came out in greater numbers than expected and spent more this holiday weekend than they did last year, though those figures may not foreshadow a stronger holiday season.
The National Retail Federation said 172 million shoppers went to stores and websites, a 17 percent increase from a year ago and more than a forecast of 128 million. They spent an average of $372.57, up 7.2 percent from last year, according to an e-mailed survey conducted for the NRF by BIGresearch, a Worthington, Ohio, polling firm.
The early turnout may not be enough to overcome consumers' reluctance to spend as they cope with climbing unemployment and housing costs and shrinking values in their stock holdings. The NRF said its forecast remains that holiday sales will rise 2.2 percent to $470.4 billion, the slowest growth in six years.
Retailers understand that Black Friday is not indicative of what remains to be seen for the rest of the holiday season, NRF spokeswoman Kathy Grannis said yesterday.
"The amount of shopping and the way that consumers plan on spending the rest of the season won't look anything like we just saw this weekend," she said.
In 2007, while 4.8 percent more customers shopped during the period, they spent on average 3.5 percent less.
This year's pattern may be similar to 2002, when total holiday sales rose only 1.3 percent, Grannis said.
Shoppers have spent 4 percent less online this holiday season so far, although purchases ticked up from last year on Thanksgiving and Black Friday, Comscore Inc. said.
Five fewer days between Thanksgiving and Christmas and more budget pressures may be driving shoppers to make earlier purchases, said Ron LaPierre, president of the comparison shopping site PriceGrabber.com.
"Times are tough, and when times are tough you need to make sure you get every ounce of value you can out of whatever budget you're able to allocate yourself," LaPierre said.
Black Friday visits to PriceGrabber.com rose 11 percent this year, more than he had anticipated, LaPierre said.
Shoppers are buying more games, puzzles, arts and crafts items, and basic clothing such as pajamas, LaPierre said. They're also looking for fireplaces, toasters, and other items to entertain at home, he said.
Retailers can make more than a third of their annual income during the holiday season. This year, though, merchants are more willing to make steeper markdowns, which will erode profit, Grannis said.
Some retailers are already coming forward with loss leaders they may have never considered before with deep discounts on items such as cashmere sweaters, she said. They've also extended sales that used to last just the day after Thanksgiving through the weekend, she said.
Retailers knew going into Black Friday weekend that it was going to take extreme measures to excite shoppers again, Grannis said. 