It’s lull time for retailers.
Traffic has been down for more than a week as the holiday season’s uncertainties and pressures mount and the briskness of the Black Friday weekend fades to a memory.
But business should bounce back by Saturday and surge again Dec. 22 to 25. Retailers have a full weekend and extra day of shopping before Christmas, which falls on a Tuesday, though since the start of December, some are lamenting the season’s slow progress.
“The tenor of the business hasn’t picked up the way we hoped it would,” David Jaffe, chairman and chief executive of Dress Barn Inc., said Monday. “We’ve seen weaker traffic than last year. The consumer is focused on deals and getting the best bargains. Maybe that customer has focused more on consumer electronics or other home goods. It seems the misses’ customer is not shopping to the same extent that she was last year.”
“It’s almost like you get two bell curves between Thanksgiving and Christmas,” observed Tim Olson, president of the management division of Urban Retail Properties, the Chicago-based development and property manager.
Between the surge in shopper traffic on Black Friday weekend and the one anticipated just before Christmas, “everyone has just stopped shopping for awhile,” Olson said. “But the good news is retailers will hit the top of the bell curve on the Dec. 22 and 23 weekend,” he added.
“I see a lot of inventory on the floors, with sale prices continuing. People are a little disappointed by the lull. There might be another attempt to jump-start traffic even more,” predicted Arnold Aronson, managing director of retail strategies at Kurt Salmon Associates. Aronson characterized this season’s crop of retail promotions as more aggressive than last year’s “in terms of extra hours and incentives, though price promoting is in the same range.”
Dress Barn’s Jaffe said his company has additional promotional posters for store windows and merchandise deals ready to go to lure more shoppers. The company operates the Dress Barn chain, which targets misses’ customers, and Maurices, for juniors, which is seeing better trends.
High-end and better-priced retailers, and those concentrated in the Northeast, seem to be faring the best. “Business last week was definitely better than the week before,” said Jane Elfers, president and ceo of Lord & Taylor. “We are pleased with the results of the month, but there is lot of time left between now and the end of December. It’s a long road.”
This story first appeared in the December 11, 2007 issue of WWD. Subscribe Today.
At apparel retailers, luxury goods, cashmere, outerwear and cold-weather accessories, gift cards, dresses, contemporary sportswear, handbags, jewelry and shoes, have done well this season, helped by tourism, particularly at big flagships in gateway cities. So have price promotions and extended shopping hours. Overall, though, the hot gifts remain more in electronics than apparel, including flat-screen TVs, GPS devices and the Wii game system.
ComScore Inc. said e-commerce spending from Nov. 1 to Dec. 7 rose to $18 billion, marking an 18 percent gain versus the same days last year. On Thursday, online sales hit $803 million, up 28 percent, which ComScore said was the heaviest online spending day in history. ComScore chairman Gian Fulgoni said in a statement, “It was a terrific kick-start to December, but we expect the upcoming week [beginning Dec. 10] to be the heaviest online spending week of the holiday season as the procrastinators and late-season deal-seekers come out in earnest.” In fact, Dec. 10 and 11 are expected to be the two busiest shopping days of the year on the Web.
However, retailers have generally been disappointed about most sportswear departments.
Some executives reported Monday that last week was better than expected, considering the dire Wall Street forecasts that flooded the media in November.
“We were very satisfied with the week,” said Michael Gould, chairman and ceo of Bloomingdale’s. “I felt good about our business,” which he said was paced by luxury products, center core accessories, home goods, men’s wear and gift cards.
Barbara Corrigan, senior marketing manager for The 900 Shops, on North Michigan Avenue in Chicago, said, “Our traffic was definitely up this weekend. You could definitely tell by the number of shopping bags. People weren’t just out looking. They were shopping.”
Jewelry, luxury apparel, cashmere and electronics were among the best-selling categories. She said the line to greet Santa was up 20 percent from last year. Stores at The 900 Shops, which is managed by Urban Retail, that cited robust business included Gucci, MaxMara, J, Crew and Scandia Down. “We really didn’t have a lull,” Corrigan said. The center is anchored by Bloomingdale’s and has 70 specialty shops, including Lalique, Banana Republic and Mark Shale.
Almost half, or 48.8 percent, of American consumers shopped last weekend, down from 59 percent last year, according to a national survey of 800 consumers on Saturday and Sunday by America’s Research Group. The survey indicates that consumers are waiting for bigger discounts the weekend before Christmas to finish shopping. “The consumers, as always, have the upper hand because they make the purchasing decisions, and retailers will have to work harder to entice them to buy,” C. Britt Beemer, founder and chairman of ARG, said in a statement.
The poll also indicates that consumers are split over whether they are seeing more (34.1 percent) or less (31.4 percent) big discounts this Christmas, but this was the highest level of “seeing less discounts” in recent years.