That was the general view of the holiday shopping season, which proved a stressful roller-coaster ride for retailers — and was further evidence of a wary, fickle consumer who is likely to remain so way into 2012.
Holiday 2011 at this point is seen yielding about 3 percent sales gains on average, leaving fashion merchants circumspect about spring. There are also growing concerns about fourth-quarter margins due to the incessant promoting; some inventory excesses, particularly in winter clothes given the relatively mild temperatures throughout the country, and whether costs involved in keeping stores open longer than last year were worth it. Some like Macy’s and Toys ‘R’ Us had certain locations operating round-the-clock in the final days before Christmas, though generally stores have become better in the past few years at managing expenses and inventories.
A strong Black Friday; steroidal promoting; the usual late surge, which this year began on Saturday Dec. 17, and robust online shopping got retailers through the season. In November and December, 41 percent of consumers shopped online, versus just over 30 percent in the same period last year, according to American Research Group, which has been surveying 1,000 consumers weekly. The online activity sapped some business out of the brick-and-mortar channel. From Dec. 1 to Dec. 24, store traffic was down 6 percent and store sales slipped 5 percent, according to RetailNext, a consulting service that tracked traffic at 40 chains across the U.S.
The next few weeks are crucial for clearing goods and making way for spring merchandise, as retailers continue to bombard consumers with coupons and unleash clearances to reduce excessive inventory and generate more than just gift returns. “Retailers have to get the merchandise out by Presidents’ [Day] weekend,” to make room for spring goods, said Britt Beemer, chairman of American Research Group. “They have more inventory than they want to admit.”
On Monday, with schools on winter break and most companies closed, stores and outlets were busy, though it was too soon to tell whether consumers were seriously shopping or just eager to get out after being cooped up for Christmas.
“It’s a madhouse,” said Lou Amendola, chief merchandising officer at Brooks Brothers, describing the Madison Avenue flagship of the specialty chain, which kicked off its semiannual sale offering up to 40 percent off. “From the minute the store opened, people were waiting to get in. They just love to buy when it goes on sale. We had suspected people were definitely waiting for a sale, but we were surprised they were out there at 8. You would have thought more like 10 or 11.”
It was some reassurance to a season Amendola described as up in the low single-digits through Christmas Eve. “Definitely the last week was the strongest week of December. For us, a lot rides on this week between Christmas and New Year’s,” Amendola said.
“I believe today is going to be phenomenal,” predicted Shelley E. Kohan, vice president of retail consultants RetailNext, of the shopping frenzy on Dec. 26, partly because consumers were busy with holiday family gatherings Sunday, and Saturday was weak, with sales dropping 15 percent although Friday was up 4 percent.
“At the end, the increases were better than we had anticipated, which we hope is an indication for spring, but I am concerned and believe it will be challenging going forward with Wall Street definitely rocky,” said Bob Mitchell, co-president of the Mitchells Family of Stores. “I don’t think spring is going to be bad, but it’s still a time to be cautious and to be better merchants. Customers want unique merchandise and collections to be better assorted. The personalized service and attention we give customers is a big factor. I saw that for sure the last two weeks. All the familiar faces — they want to still shop with us.”
Greg Bettinelli, senior vice president of marketing at HauteLook, the flash sale site offering 50 to 80 percent off brand names, said, “We were really excited about how the holiday season went. We saw strong growth year-over-year from Black Friday through the middle of December. We actually grew as fast in 2011 as we did in 2010, upwards of 75 percent, and we didn’t give away the house. We didn’t do a tremendous amount of price promoting or free shipping.” Mobile shopping via tablets, iPads and smartphones rose up to 30 percent, depending on the day, and the period saw a pretty even split between gift and self-purchasing, Bettinelli said.
“What happened in [the fourth quarter] will propel us into spring,” Bettinelli said. There is just more adoption [by consumers] to our model.” As far as retail at large, “We are clearly seeing the middle and higher end continue to grow. The lower end continues to struggle.”
At Nordstrom, “Overall we’re encouraged by our trends over the last several months and we’re looking to continue those into next year, ” said Colin Johnson,spokesman for the Seattle-based upscale specialty chain, which on Monday launched its half-yearly sale for men’s wear, a strong category this season at the store.
“With 2012 being an election year, a lot of energy is being pumped into the economy, so I think we’ll see improved performance saleswise,” added Fraser Ross, owner of a dozen Kitson boutiques. He agreed that men’s wear was particularly strong this season, especially in cotton and cashmere, and he expects increased sales into 2012.
Other retailers and pundits said that for the season overall, the retail landscape has been mixed. Performances at Macy’s, Nordstrom and other department stores are said to be among the best. Other stores expected to be report good seasons are Neiman Marcus and units of The TJX Cos. Inc., while Target, Wal-Mart and Kohl’s are seen turning in decent results, and Sears, Talbots and Best Buy could prove to be disappointing with their bottom lines. “Business is tough. It’s no secret,” said one mass merchant.
Von Maur, a family-owned, 26-unit department store chain in the Midwest and South, reported a double-digit increase in December. The chain’s chief operating officer, Melody Westendorf, said the store “continues to see business shift later and later as you get toward Christmas.…We think we had the largest day in company history on Friday. It was kind of crazy.”
Yet she was uncertain about spring. “Whenever the media throws out a question mark about the economy, then customers pull back a bit,” she said. “It’s hard for the consumer to know if things are getting better or worse.”
Business was strong throughout the season at Ideeli.com, led by watches, statement jewelry, cashmere and boots, said chief executive officer Paul Hurley. He expects the flash shopping site will wrap up 2011 with about $200 million in sales — a 150 percent leap over 2010. The company has about 5 million subscribers, against 3 million last year.
“We had a big, big jump in mobile sales — double over last year,” Hurley noted. “And we doubled the number of gift cards and tripled revenue, so I think we’ll have good spending on gift cards going forward.”
Ideeli and other e-tailers are promoting “gifts you didn’t get” to spur post Christmas shopping.
“As other retailers can tell you, this season it was a sale-driven customer. Promotion remained very big,” said a Forever 21 spokesperson. “People were looking for the markdown.…Our approach this coming year will be consistent with what we’ve done in the past — we want to expand the number of stores and also merchandise categories in our larger boxes. We already have girls and youth, and we will definitely be focusing on expanding customer reach, that’s what we consistently do.”
In Dallas, luxury stores Forty Five Ten and Stanley Korshak did well enough during the season that they decided to give their employees a break and stay closed Monday. “A series of 10 personal appearances and trunk shows kept customers coming back,” noted Brian Bolke, a partner in Forty Five Ten. The Woods jewelry, for instance, reaped $110,000 in a trunk show. “As long as the customers are kept interested and engaged, the outlook is positive,” Bolke said. “You can’t sit on your hands and wait for them to come spend. Keeping it ‘fun’ and new is the key. People are easily bored, and once they move on, it’s hard to get them back.”
On a category basis, nationwide, colored denim, boots, boot-cut jeans, cocktail dresses, handbags, children’s wear, watches and luxury in general were tracking increases. Cold weather apparel and sportswear were the weakest areas. Video games were faring better than toys, while mobile devices, including tablets and smartphones, were outperforming other electronics — once again establishing the Apple stores as among the busiest of all.
"I was driving back on Saturday afternoon from the beach, and I just saw this sign saying 'Skydiving for $95.' And I was like, I can't not sky dive for $95," says Tom Bateman about a moment in Hawaii while shooting "Snatched." #wwdeye (📷: @vsteves; Interview by @ktauer; Styled by @thealexbadia)