Retailers get jump on season
Justine Griffin/Sarasota Herald-Tribune
Don’t get spooked, but Christmas trees, holiday music and popular toys are already starting to creep into area stores — before Halloween is even a memory.
Despite, or perhaps because of, strong holiday sales in 2011 — consumers spent $563 billion, the most since 1999 — retailers are prepping for holiday sales earlier than ever to get a jump on competition and entice customers to shop longer.
On the buying side, the National Retail Federation says consumers are once again primed to spend.
“We’ve seen this pattern of cautious optimism all year, and despite the challenges that still exist in our economy, it looks as if consumers are eager to celebrate with friends and family,” said Matthew Shay, the federation’s president and CEO, in a statement.
The NRF is forecasting holiday shopping will be up a healthy 4.1 percent this year, to $586 billion — or about $749.51 per person — versus 2011.
While many consumers remain cautious, confidence appears to be rising. Retail sales in September rose to their highest point in seven months, according to real estate firm Marcus & Millichap.
And with Thanksgiving Day earlier this year, on Nov. 22, retailers are hopeful extra days before Christmas will lead to additional sales.
“That is 32 days total, or five full weekends for shoppers to get out there after Thanksgiving,” said John Fleming, a spokesman with the Florida Retail Federation.
Some retail observers believe shoppers are waiting on the outcome of the presidential election next month before making holiday buying decisions.
“You’re seeing a lot of business activity at a halt right now, because people are waiting to make big spending decisions until they know who is stepping into office,” said Pat Fitzpatrick, president of Atlanta Retail Consulting.The coming election has stunted retailers, too, by curtailing TV ad time usually devoted to promoting holiday door busters. As a result, most will have only a two-week window in which to advertise before Black Friday, the traditional post-Thanksgiving kick-off to the holiday shopping season.
But not everyone shares the opinion that the Nov. 6 election will affect shopping, or that this holiday season will be a bright one.
“Retail is in trouble — stores are shrinking or focusing on outlet brands instead,” said Howard Davidowitz, chairman of Davidowitz & Associates Inc., a New York-based retail consulting firm.
Betting on layaway
Some chain stores are not waiting to work on boosting sales. Walmart, most notably, announced the return of a layaway program Sept. 14, a month earlier than last year.
Sears, Kmart and Toys R Us also have revamped layaway programs, in response to consumer demand and to heighten sales.
With one in seven consumers having used 80 percent of their individual credit limit on past purchases, layaways give shoppers an opportunity to reserve gifts and pay in installments without incurring interest.
“Back when people had 12 credit cards, there was no reason for it,” Davidowitz said of layaways. “Now, most everybody is using it because credit is so strained.”
Analysts note layaways provide shoppers with an opportunity to make additional seasonal purchases, especially of bigger-ticket items like televisions and other electronics that they may have otherwise passed on as a result of tight budgets.
“Five years ago, I would have never thought I would see layaway again in our lifetime, but that dinosaur just will not die,” Fitzpatrick said.
“But with so many folks being challenged these days, it is a wise move for retailers to bring back that notion.”
And it’s not just the major chains that are turning to layaway. Chains like Burlington Coat Factory, TJ Maxx, Marshalls and Hallmark gift stores also offer layaway services.
Competing for dollars
To better compete with online giants Amazon and eBay, which offer little to no shipping costs, some brick-and-mortar stores have turned to matching online prices.
Best Buy, Toys R Us, Walmart and Target all match, mainly through smartphone-accessible “quick response” barcodes.
Target is allowing shoppers from Nov. 1 through Dec. 16 to pay a lesser shelf purchase price if they have competitor coupons or circular ads.
“Every retailer should be using mobile apps by now,” said Jeff Green, a Phoenix-based retail consultant who has done extensive work in Southwest Florida. “It only increases the visibility of brick-and-mortar stores.”
Best Buy and other chains, meanwhile, have begun offering shipping directly to customers’ nearest stores.
At the same time, some retailers are taking the approach that more is better.
Electronics chain hhgregg, which has expanded aggressively in Florida in the past year, will offer more merchandise than ever in time for the holidays.
The chain’s stores in Sarasota, in fact, plan to sell fitness equipment and some furniture, including units and couches for home theaters, beginning in November, said Curtis Etheridge, an hhgregg regional manager.
For its part, Target is pairing with upscale department store chain Neiman Marcus to sell a joint holiday collection of clothing, home décor and other gifts. It will be available in both retailers’ stores, beginning Dec. 1.
Select Macy’s department stores will house pop-up Toys R Us stores of roughly 1,500 square feet, and many will stay open past the holidays.
Though the chain operates stores in both the Sarasota Square Mall and Southgate Mall locally, the nearest pop-up toy store will be in Clearwater.
Some analysts wonder, however, whether retailers will be able to generate enough revenue to justify added staff and expenses associated with their additional programs.
“They are creating disadvantages for themselves just to get your dollar,” Fitzpatrick said.
At Westfield Corp.’s two local shopping malls, Southgate and Sarasota Square, the company is hoping charitable efforts will pay off with added sales.
At Southgate, Westfield is giving away $25 holiday “Give Cards” to shoppers who spend more than $200 a day at the mall. The cards, which will be available through December, can be donated through the “Give with Purpose” program.
Sarasota Square will host a Festival of Wreaths to support local non-profits.
Ellenton’s Premium Outlets, known for holding Thanksgiving night shopping extravaganzas in recent years, hopes to please customers this year as well.
The Simon Property Group discount mall intends to open at 12 a.m. on Black Friday, furthering a trend in which retailers have begun holiday shopping events earlier and earlier.
The outlet mall, off Interstate 75, also plans to stay open later than normal to draw customers.
But none of the gimmicks will work, at least one expert contends, if merchants do not keep budget-conscious consumers in mind.
“Value is king in today’s market,” Davidowitz said.