Last-Minute Shoppers Flood Malls
NEW YORK – Shoppers — some holding out for the best bargains, others delayed by winter storms in the Midwest — hit the nation's malls and stores, looking for last-minute gifts and snapping up gift cards on Friday, the day before Christmas.
Retailers, struggling with disappointing holiday sales throughout the season, were heartened by an uptick in sales at malls this week, and traffic appeared solid Friday. But the industry is still resigned to the fact that the 2004 holiday shopping season won't be stellar — the question is whether the last-minute boost will be enough to help stores meet their modest sales goals.
The exceptions have been online shopping, with sales at the high end of projections, and luxury stores, which have continued with robust sales from their well-heeled customers.
That means merchants are once again finding themselves in the same position as they were last year, relying on those last-minute shoppers, who seem to be delaying their buying even later than a year ago. Last year, a late spending surge gave struggling retailers a better-than-expected holiday season. In 2002, however, the last-minute boost before and after Christmas was not sufficient to overcome December's earlier weakness.
With many stores struggling with higher inventories at this late stage of the holiday season compared with last year, plenty of customers looking for bargains were pleased with the options.
"It looks like the deals are getting better," said Charles Mincey of New Hope, Ga., who bought himself an Izod polo shirt at Rich's-Macy's department store for half price at the Lenox Square in Atlanta. He and wife decided to spend Christmas Eve day buying a few treats for themselves because they finished holiday shopping early.
Also at Lenox Square was Brinson Silver of Atlanta, who was buying more gift cards from stores like Banana Republic and Brooks Brothers.
"That way everyone can get what they want," he said.
Still, procrastinating does carry risks.
"I saw the perfect necklace for my niece, but someone snatched it from me," said Patrick Radeboldt, who was shopping in Manhattan. "I'll figure something out."
At Macy's flagship store in Manhattan, Doris Keehan, a Queens store manager, was loaded down with bags of jewelry and sweaters.
"I didn't get a chance to shop until today," she said. "But if you know the person, it's a very easy process. And of course, there's always the ability to return."
In Cincinnati, Ohio, and other parts of the Midwest, which were hit by a heavy snowstorm Thursday, plenty of shoppers were out doing the last-minute buying they were supposed to do earlier in the week.
"If it had been like the last two days, I wouldn't have come out," said Pat Marler, who was at the Eastgate Mall in suburban Cincinnati. "I mainly needed to pick up a few odds and ends. I actually did my shopping a little earlier than usual — luckily. I just have one more stop, then I'm heading home because it's just too cold."
Michael P. Niemira, chief economist at International Council of Shopping Centers (search), is sticking with his latest holiday forecasts, having lowered his sales growth forecasts to 2.5 percent to 3 percent earlier in the month. He had originally projected sales for the November and December period would be up anywhere from 3 percent to 4 percent.
The estimate is based on sales at stores opened at least a year, known as same-store sales. Same-store sales are considered the best indicator of a retailer's health.
Ellen Tolley, a spokeswoman at the National Retail Federation (search), said the industry group continues to forecast a 4.5 percent gain in total holiday sales, which exclude restaurant and auto sales. She noted that Midwestern storms this week did put a damper on sales in certain areas, calling it a "momentary glitch," but a lot of shoppers had planned their shopping around it.
Meanwhile, online sales have been robust. Internet research firm comScore Networks Inc. (search) said online sales in November and December are tracking at the high end of its forecast of a 23 percent to 26 percent gain from the year-earlier period.
In fact, Justin Tucker of Knoxville, Iowa, said he did "most of his shopping on Amazon," and was just picking up "some last-minute things."
The final days before Christmas and post-holiday business, boosted in part by gift card sales, have become increasingly important for retailers. Gift card sales are not recorded on a retailer's balance sheet until the cards are redeemed.
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.
While Christmas Eve day is not traditionally a big sales generator, Tolley believes it could be much busier than in years past because this year it's a federal holiday, providing shoppers the opportunity to do more buying on that day.
Karen MacDonald, a spokeswoman at Taubman Centers (search), which operates or owns 22 malls across the country, said she was pleased with traffic Friday as well as this past week.
"It feels good out there," she added. She noted that gift card sales have seen double digit increases at the malls compared to a year ago this season, and have picked up even more these past few days.
Lisa Gibbons, a spokeswoman at Sears, Roebuck and Co. (S), said that traffic was stronger on Christmas Eve day than a year ago, based on a spot-check of stores.
Sears and other mid- to-low-priced stores, who have wooed customers with expanded hours and deep discounts, were doing it again at the season's finale. Sears offered discounts of between 40 to 60 percent on jewelry and 25 percent to 30 percent off of watches from Monday through Friday.
Those discounts will be increased even more after Christmas, but don't count on Gail Whide of Phoenix to show up for post-holiday bargains.
"This year, it seemed like everybody had stuff on sale sooner," said Whide of Phoenix. "That's good. The day after Christmas I can sleep."