Retailers work to stretch slack holiday sales
By Staff -- Gifts and Dec, 12/26/2007 9:58:00 AM
NEW YORK—The pre-Christmas sales rush is over and the initial reports say the situation at retail in the run-up to the holiday's Dec. 24 deadline was slow, as expected, with overall retail sales up 3.6 percent in the period between Thanksgiving and Christmas day, a noticeable drop from recent years.
That 3.6 percent gain, a figure tallied by MasterCard Advisors’ SpendingPulse service that includes sales at restaurants and gas stations, was far from last year’s 6.6 percent holiday sales jump, and well off from 2005’s particularly strong 8.7 percent growth spurt. This year’s 3.6 percent figure falls to 2.4 percent if gasoline sales are factored out, according to The Wall Street Journal.
SpendingPulse’s report found that the product categories that grew fastest this year were luxury goods (excluding jewelry), up 7.1 percent, and shoes, up 6 percent. Despite a fast start, consumer electronics sales slowed considerably after at 15 percent gain on Black Friday to end up with only a 2.7 percent rise by season’s end. Toys were not specifically broken out as a product category for analysis.
Commenting on the sales results, Michael McNamara, vice president of research and analysis at MasterCard Advisors, said, “Overall, sales came in just above the lower end of the range we were expecting, maintaining the slower, modest growth we've been seeing throughout the year.” He added, “Most industry observers had adjusted their sights down, but anyone who was looking for this holiday season to kick-start a new wave of growth would find these numbers falling short of expectation,” he added.
Of the major toy-selling mass merchants, only Target Corp. has announced its projected holiday sales numbers. Based on actual sales at Target stores for the first three weeks of December and a forecast for the remaining two weeks of the month, the retailer said it now expects its overall calendar-adjusted comparable store sales for the month of December to lie in the range of minus 1 to plus 1 percent.
“While this outlook reflects an increase in traffic at the end of the third week, this increase was not sufficient to compensate for the unfavorable traffic trends that carried over into December from the week following Thanksgiving,” the company said in a statement released this morning.
At online toy stores, promotional pricing is in full swing today. At its website, Toys “R” Us is offering shoppers who pay using PayPal a $20 discount on any net purchase worth more than $75, not including video game hardware, Bugaboo items or gift cards. The deal runs through Dec. 31. The retailer was also selling several lines at up to 60 percent off, including buy one get one free deals on LeapFrog’s Leapster and LMax software and VTech’s V.Smile cartridges, and buy one get one 50 percent off sales on select Hasbro board games and Learning Curve’s Thomas Wooden Railway accessories.
KBtoys.com and its sister site eToys.com are offering 60 percent off on a wide assortment of popular name-brand products through Jan. 2, many of which were out of stock as of this morning, along with half-off deals on many games. Several other discount deals expire today.
At FAO Schwarz’s site, sale items are mostly 25 percent off, in a mix that includes an assortment of the upscale specialty retailer's exclusive products.
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