The Herald Bulletin

Evening Update

Nation & World

December 1, 2013

Record crowds over weekend, but spending declined

NEW YORK — Did stores shoot themselves in the foot?

Target, Macy's and other retailers offered holiday discounts in early November and opened stores on Thanksgiving Day. It was an effort to attract shoppers before Black Friday, the day after Thanksgiving that traditionally kicks off the holiday shopping season.

Those tactics drew bigger crowds, but failed to motivate Americans to spend.

A record 141 million people are expected to shop in stores and online over the four-day Thanksgiving weekend that ends Sunday, up from last year's 137 million, according to the results of a survey of nearly 4,500 shoppers conducted for The National Retail Federation.

But total spending is expected to fall for the first time ever since the trade group began tracking it in 2006, according to the survey that was released on Sunday. Over the four days, spending fell an estimated 2.9 percent to $57.4 billion.

Shoppers, on average, are expected to spend $407.02 during the four days, down 3.9 percent from last year. That would be the first decline since the 2009 holiday shopping season when the economy was just coming out of the recession.

The survey underscores the challenges stores have faced since the recession began in late 2007. Retailers had to offer deep discounts to get people to shop during the downturn, but Americans still expect those "70 percent off" signs now during the uneven economic recovery.

Stores may have only exacerbated that expectation this year. By offering bargains earlier in the season, it seems they've created a vicious cycle in which they'll need to constantly offer bigger sales to get people to spend. That's because shoppers who took advantage of "holiday" deals before Thanksgiving may have deal fatigue and are cautious about buying anything else unless it's heavily discounted.

"The economy spoke loud and clear over the past few days," said Brian Sozzi, CEO and chief equities strategist at Belus Capital Advisors. "We are going to see an increase in markdowns."

Matthew Shay, president and CEO of The National Retail Federation, said that the survey results only represent one extended weekend in what is typically the biggest shopping period of the year. The combined months of November and December can account for up to 40 percent of retailers' revenue.

Overall, Shay said the trade group still expects sales for the combined two months to increase 3.9 percent to $602.1 billion. That's higher than the 3.5 percent pace in the previous year.

But to achieve that growth, retailers will likely have to offer big sales events. In a stronger economy, people who shopped early would continue to do so throughout the season. But analysts say that's not likely to be the case in this still tough economic climate.

"It's pretty clear that in the current environment, customers expect promotions," Shay said. "Absent promotions, they're not really spending."

Take Tuesday Trasvina, 37, who said she's been bombarded with holiday discounts since early November. Trasvina, a marketing coordinator, plans to spend $500 on holiday gifts, about a quarter of what she spent last year.

"They've been stretching out this Black Friday thing so long," said Trasvina, who was shopping with her husband on Friday at a Target store in Portland, Ore. "I just think the over-commercialization of the holiday has gotten to us."

At least a dozen major retailers — most of them for the first time — opened on Thanksgiving instead of on Black Friday, which is typically the biggest shopping day of the year. Wal-Mart, Toys R Us and other retailers said on Friday that Thanksgiving crowds were strong.

But the early start appeared to pull sales forward. Black Friday sales fell 13.2 percent from the previous year to $9.74 billion, according to Chicago-based technology firm ShopperTrak. But combined spending over Thanksgiving and Black Friday rose 2.3 percent to $12.3 billion compared with a year ago.

A Kmart store in New York City that opened at 6 a.m. on Thanksgiving and stayed open for 41 hour straight was packed on the holiday. Clothing was marked down 30 percent to 50 percent.

Adriana Tavaraz, 51, headed there at about 4 p.m. and spent $105 on ornaments, Santa hats and other holiday decor. She saved about 50 percent.

But it's not likely Tavaraz will be back in stores too many more times this season. Money is tight this year because of rising costs for food and rent, and Tavaraz already spent much of her $200 holiday budget.

"Nowadays, you have to think about what you spend," she said. "You have to think about tomorrow."

____

 

1
Text Only
Nation & World
  • news_malaysiaplanesearch.jpg Sub makes second dive to search for Malaysian plane

    As a robotic submarine dived into the ocean to look for lost Flight 370, angry Chinese relatives stormed out of a teleconference meeting Wednesday to protest the Malaysian government for not addressing them in person.

    April 16, 2014 1 Photo

  • 3 APTOPIX Police Conver_Unde-1.jpg Feds: Boston bombing suspect not entitled to '11 murder file

    Federal prosecutors have told a judge they have no evidence that Boston Marathon bombing suspect Dzhokhar Tsarnaev knew about his brother's alleged role in a triple slaying in Waltham two years before the bombings.

    April 16, 2014 1 Photo

  • Boston police safely blow up suspicious backpacks

    Survivors, first responders and relatives of those killed in the Boston Marathon bombing marked the anniversary Tuesday with tributes that combined sorrow over the loss of innocent victims with pride over the city's resilience in the face of a terror attack.

    April 16, 2014

  • 292 missing, 4 dead in South Korea ferry disaster

    A ferry carrying 459 people, mostly high school students on an overnight trip to a tourist island, sank off South Korea's southern coast on Wednesday, leaving nearly 300 people missing despite a frantic, hours-long rescue by dozens of ships and helicopters. At least four people were confirmed dead and 55 injured.

    April 16, 2014

  • GM sales eyed for impact of ignition switch recall

    As General Motors shows off its newest cars and trucks in New York this week, analysts are watching for signs that consumers are shying away from the ones sitting on dealer lots.

    April 15, 2014

  • Solemn tributes mark Boston Marathon bombing

    Survivors, first responders and family members of those killed in the Boston Marathon bombing marked the anniversary Tuesday with tributes that combined sorrow over the loss of innocent victims with pride over Boston's resilience in the face of a terror attack.

    April 15, 2014

  • First women move to Army platoon artillery jobs

     Under a canopy of trees on the edge of a large field, soldiers from Bravo Battery are lying in a circle as they pore over targeting charts. Nearby, others are preparing the howitzer cannons as helicopters swoop overhead. At the edge of the circle, the platoon leader watches as the field artillerymen go through their training exercise.

    April 15, 2014

  • Russia tests Obama's ability to stop its advances

     With the White House asserting that Russia is stoking instability in eastern Ukraine, President Barack Obama is once again faced with the complicated reality of following through on his tough warnings against overseas provocations.

    April 15, 2014

  • Malaysia jet search area too deep for submarine

    The search area for the missing Malaysian jet has proved too deep for a robotic submarine which was hauled back to the surface of the Indian Ocean less than half way through its first seabed hunt for wreckage and the all-important black boxes, authorities said on Tuesday.

    April 14, 2014

  • Rocket leak delays space station delivery launch

    A space station cargo ship will remain Earthbound for a while longer because of a rocket leak.

    April 14, 2014

More Resources from The Herald Bulletin
AP Video
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
Helium debate
Helium