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Consumers Head to Stores the Day After Christmas to Grab Bargains
The Associated Press ^ | 12-26-04 1542EST | Anne D'innocenzio

Posted on 12/26/2004 1:00:01 PM PST by BenLurkin

Shoppers headed to the nation's malls and stores to grab discounted coats, cashmere sweaters and other items on Sunday as merchants slashed prices even deeper in hopes of squeezing more sales out of what's winding up to be an unimpressive holiday season. After struggling with disappointing sales throughout the holiday season, retailers and mall operators like J.C. Penney Co. Inc. and Taubman Centers Inc. reported a pickup in sales this past week, though winter storms in the Midwest stymied shopping in the affected regions. Now, merchants are focusing on the week after Christmas, relying on shoppers to do more buying - and less returning - to meet their modest sales goals.

With gift cards increasingly popular, plenty of stores including Penney and Target were encouraging consumers in advertising on Sunday to spend them immediately - gift cards are recorded as sales only when they are redeemed.

"The holiday season will be told on how many gift cards get redeemed in the week after Christmas, versus how many wait until January and February," said Ellen Tolley, a spokeswoman for the National Retail Federation, which estimated $17.24 billion worth - or roughly about 8 percent of holiday sales - will be sold in gift cards this season.

The industry association is sticking with its forecast of a 4.5 percent gain in total sales for November and December. That excludes restaurant and auto sales.

Other bright spots this season have been online shopping, with sales at the high end of projections, and luxury stores, which have continued with robust sales.

About 400 people endured the cold and snowy roads to shop at Kaufmann's at Polaris Fashion Place in Columbus, Ohio.

The early bargain-hunters were treated to 50 to 60 percent off everything from coats to shoes to gold jewelry. Many also came in the door with a newspaper coupon offering $10 off if they spent more than $25.

Among the crowds were Tomi and Ira Campbell of Columbus, who arrived at Kaufmann's at about 6:30 a.m., with their 3-year-old son, and an ad with a circled listing for cashmere sweaters discounted to $29.99.

"You can't beat that. I've watched the cashmere sweaters for months," Tomi Campbell said. "I got two cashmeres for less than the price of one."

At Phipps Plaza in Atlanta, homemaker Katie Hercik, 57, said she had already completed her holiday shopping and was at the mall to pick out some things for herself, including shirts and a purse. She stopped in Parisian, which was offering scratch-off cards that included a chance to win up to an additional 50 percent off on some items or a new Mercedes.

"We didn't win the car, but we got 25 percent more off," Hercik said.

Crowds were already gathering at the Glendale Galleria in Los Angeles by 8 a.m.

Hal Panabaker of Glendale, Calif., was the designated returner in his family, waking early to bring back gifts at several mall stores including the Gap, where he was able to resist the 50 percent off sale on many items.

"I had the most returns," he said. "I'm an early riser, so this morning, it's me and Starbucks."

In New York, shoppers waiting for Macy's Herald Square store to open were hunting everything from clothes to discounted holiday items as the store offered savings of as much as 75 percent. But Raymond Freeman, from Manhattan, said he didn't have anything specific in mind. He was getting his Christmas shopping done.

"I always wait until after (Christmas) to do shopping. You get better deals," he said.

Merchants are finding themselves in the same position they were in last year, relying on the final days before and post-holiday sales to save the season. Last year, a late spending surge gave struggling retailers a better-than-expected holiday season, delivering solid gains over the year-ago period. In 2002, however, the last-minute boost before and after Christmas was not sufficient to overcome December's earlier weakness.

The mid-to low-price stores - whose customers are more vulnerable to the economy's woes and had pushed hard with discounts - further sweetened the deals on the day after Christmas, which was the third busiest day of the holiday shopping season last year.

Sears, Roebuck and Co. took an additional 20 percent off its already reduced apparel for up to 60 percent savings. In addition, all televisions and home theater systems were on sale, and there was 50 percent off of all toys and 50 to 75 percent of all Christmas shop items.

J.C. Penney offered early bird specials on apparel.

Even luxury stores like Saks Fifth Avenue and Bergdorf Goodman, which have held back on price cutting amid strong sales, offered generous discounts of up to 70 percent. C. Britt Beemer, chairman of America's Research Group, believes that these cuts were unplanned and were an attempt to recoup lost business last week.

Tim Lyons, a spokesman at J.C. Penney Co. Inc., said that this past week was about "where we expected." The Midwest storms delayed sales until the end of the week, which saw a pickup in such items as coats and gloves.

"Overall, we are comfortable with where we are," said Lyons, who is still sticking to the company's November and December forecast for same-store sales gains to be up low single digits. Same-store sales, considered the best indicator of a retailer's health, are sales at stores opened at least a year.

Lisa Gibbons, a Sears spokeswoman said that traffic the day after Christmas was about level with a year ago, and consumers were buying apparel.

Karen MacDonald, a spokeswoman at Taubman Centers Inc., which owns or operates 22 malls across the country, said that stores are tracking on average anywhere from low to mid single digits sales gains, from a year ago, based on a spot check of malls. But luxury merchants are showing more robust gains, she said.

The full picture for the holiday shopping season won't be known until Jan. 6, when the nation's retailers are slated to report their December sales figures.

According to the International Council of Shopping Centers, the seven-day period ended Dec. 27 accounted for 20.6 percent of holiday sales in 2003, up from 19.6 percent in 2002. The seven-day period ended Jan. 3 accounted for 14.1 percent in 2003, up from 12.8 percent in 2002.


Associated Press writers Jay Cohen in Columbus, Ohio; Gary Gentile in Los Angeles; Harry Weber in Atlanta and Curtis Ellis in New York contributed to this report.

TOPICS: Business/Economy
KEYWORDS: christmas; retail

1 posted on 12/26/2004 1:00:01 PM PST by BenLurkin
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