Published December 02, 2002
NEW YORK – The holiday shopping season started with a bang over the Thanksgiving weekend, thanks to early-bird specials and slashed prices that had shoppers salivating to spend.
Discounters such as Wal-Mart Stores Inc. (WMT), which set a record for one-day sales on Friday, generating $1.43 billion, had the most success by wooing customers with pre-sunrise specials and other tantalizing bargains.
Major department stores and clothing chains generally met modest sales goals, according to analysts' preliminary estimates. Online sales also leaped up from last year.
"It was as expected. It wasn't a bonanza, but it was a good start," said Steve Nevill, partner at Kurt Salmon Associates, a retail consulting firm, indicating that this is still expected to be a difficult season.
A void of must-have items could also limit sales, although there are very popular gifts, including Hasbro (HAS)'s Fur Real Friend, a toy cat that is among the hot toys in short supply. DVD players and other home electronics items and kitchenware also did well, as did coats, sweaters and clothing that's in greater demand as the temperature falls.
"One consistent thing we heard was that only things marked down were selling. Consumers want a bargain, especially around the holiday," Nevill said.
And consumers concurred.
"We just try to save a little bit of money along the way and see how it works out in the end," said Judy Staley, 59, of Lewisburg, N.C., who was shopping at the Crabtree Valley Mall in Raleigh, N.C. on Saturday.
"Luckily, we saved about 20 percent here," she said, pointing to several bags from K-B Toys, which contained such items as dolls and action figures.
Nevill estimated that sales at department stores and mall-based clothing chains were up 2 percent for the weekend from a year ago, while discounters had a 4 percent gain.
That's about in line with analysts' modest projections for the overall holiday season. With consumers concerned about job security and shrunken stock portfolios, no one expects business to be robust.
The Thanksgiving weekend isn't necessarily a good barometer of how retailers will fare for the entire season. In fact, over the past few years, the weekend accounted for less than 10 percent of sales, according to the International Council of Shopping Centers.
But with six fewer shopping days in the season than last year, Thanksgiving weekend becomes even more critical to merchants, according to C. Britt Beemer, chairman of America's Research Group.
"There is no way you could have made up for this weekend, considering the shorter season," he said. "This is the kind of kickoff that retailers need if they are going to equal last year's numbers."
Total retail sales were up 10.9 percent for the two-day period following Thanksgiving compared with a year ago, according to ShopperTrak RCT, which tracks sales at 22,000 retail outlets. Last year, sales during the two-day period rose 5 percent.
Merchants went into the season with lean inventories, hoping to avoid drastic after-Christmas discounts. But they still felt the need to discount heavily this weekend to get a good start on the season, Nevill said.
Economic worries were on many shoppers' minds.
"It's been kind of harder this year — I had more bills this year," said Debra Person of College Park, Ga.,who took part in early morning specials on Friday and was out again in the malls on Saturday.
The sluggish economy has meant a decrease in her earning power.
"We used to get overtime," she said.
But online merchants had a good weekend. Sales were up 61 percent on Friday, compared to the day after Thanksgiving a year ago, according to BizRate.com, a research company.
Another research firm, comScore Networks Inc., reported online sales rose 40 percent. Both estimates exclude results from the travel category.
Jeff David, 28, of San Francisco had already finished most of his holiday shopping online, but he came downtown with his wife to scope out any good deals.
"I looked at a few jackets on sale, but who knows how much they were really on sale?" he said.
Target reported on a pre-recorded call that while traffic on Friday was consistent with that of previous year-ago periods, customers seemed to "linger longer" and "purchase more items per cart."
Among the top sellers were MGA Entertainment's Bratz dolls, DVD titles like Monsters Inc. and digital cameras.
Major mall operators, including Taubman Centers Inc. and General Growth Properties, said sales and shopper traffic for the weekend ran higher than a year ago.
"Last year, sales and traffic were sporadic," said Wally Brewster, senior vice president of corporate marketing at Chicago-based General Growth Properties. "This year, we are ahead of expectations."
Michael Gould, chairman of Bloomingdale's, also said sales beat expectations for the weekend.
"We felt good versus last year," he said, noting the store saw "good" increases, although he declined to elaborate. He also was hesitant to predict the rest of the season, saying instead, "We take each day as it comes."
The Associated Press contributed to this report.