Advertising

The Seattle Times Company

NWjobs | NWautos | NWhomes | NWsource | Free Classifieds | seattletimes.com

Business / Technology


Our network sites seattletimes.com | Advanced

Originally published Monday, November 20, 2006 at 12:00 AM

E-mail E-mail article      Print Print      Share Share

Holiday retailers can't wait

At the Old Navy near Southcenter, the tinsel trees went up five days before Halloween. The Christmas ornaments at Cost Plus? Dangling by late August...

Seattle Times retail reporter

At the Old Navy near Southcenter, the tinsel trees went up five days before Halloween. The Christmas ornaments at Cost Plus? Dangling by late August.

Retailers, known for commemorating even the most obscure holidays with promotions, have jumped from Halloween to Christmas this year with hardly a Thanksgiving cornucopia in sight.

In the quest to command full price for the season's hottest gifts, have they made turkeys out of customers?

Kate Newlin thinks so.

The day after Thanksgiving, called Black Friday in the retail business, has traditionally marked the start of the holiday-shopping season. The Friday was so named because it marked the day merchants turned a profit, or went "into the black," for the year.

Newlin, an author and consumer strategist, said publicly traded retailers keep moving up the start of the holiday-shopping season to ensure a profit earlier in the season. Industry experts have coined a term for the phenomenon: "Christmas creep."

Holiday shopping


Only 12.4 percent of consumers completely finished their holiday shopping 10 days before Christmas last year, according to a survey, suggesting that shoppers often procrastinate on gift purchases. Other telling facts about last year's holiday shopping:

• 33 percent of jewelry-store sales occurred during the holidays.

• 51.7 million shopped for holiday gifts online at work.

• 75 percent of women shopped at a discount store for holiday merchandise.

• 79 percent of online merchants offered free shipping, with conditions, as a holiday promotion.

• 85 percent of consumers bought and sent greeting cards during the holidays.

Source: National Retail Federation

"It's not pretty to watch," Newlin said of the trend, "but they're desperate to get those early sales started so they have something to talk about" with Wall Street.

Wal-Mart, the world's largest retailer, last week launched its most aggressive holiday pricing campaign ever, and chief rival Target followed suit, indicating it would compete on long-running discounts.

The price war will benefit consumers but should slice into profits because retailers make up to 40 percent of annual sales and half of their profits during the final two months of the year.

The mentality is "a bird in the hand is worth two in the bush," said Stephen Hoch, a marketing professor at the University of Pennsylvania's Wharton School.

"Christmas creep doesn't mean that you sell more; it's a reallocation of who gets what," Hoch said. "Retail is a market-share game."

Who gets what in holiday sales is looming large this season.

The retail industry expects consumers to spend less freely this year after enduring small, steady sacrifices, including rising interest rates and sharply fluctuating gas prices.

The National Retail Federation forecast holiday sales to grow 5 percent to $457.4 billion during the last two months of the year. By comparison, holiday sales last year rose by 6.1 percent.

If Black Friday is the most visually promoted event — often photos and videos abound of shoppers camping in front of stores and running manically down aisles toward the hottest items — the day is window dressing for the industry.

Black Friday accounts for less than 10 percent of holiday sales, according to the Telsey Advisory Group. By comparison, the Saturday before Christmas tends to be the busiest shopping day of the year.

Retail analyst Dana Telsey said shoppers procrastinate more each year, especially as retailers offer more ways to buy gifts — in stores, through catalogs, online and with gift cards. "The importance of Black Friday is typically more of a traffic event than a purchasing event," she said.

While retailers worry about bringing shoppers into their stores, the holiday season also has crept earlier online.

Four in 10 retailers with some combination of stores, catalogs and retail sites online said they planned to start their holiday marketing earlier this year. More than half launched promotions by Nov. 4, according to the 2006 eHoliday Mood Study conducted by BizRate Research.

Amazon.com lured shoppers to its Web site last week by asking customers to vote for their preferred discount. Among the nominees: 1,000 Xbox 360 Core System units, to be sold for $100 apiece, or Barbie Interactive Princess dolls for $10 a pop.

Newlin, the retail strategist, said good retailers will de-emphasize price this season and find ways to enhance customer service. This might mean offering free gift wrapping or hiring a roving group of salespeople whose sole purpose is to break up long lines. "That would be the goal," she said, "to put service back into the equation."

Not everyone started promoting the holidays early.

Macy's opened its seasonal home-décor area, "Holiday Lane," between late September and early October. "We've not started any earlier than we have previously," said Rob Campbell, spokesman for Macy's Northwest.

At the Ann Taylor in Pacific Place in downtown Seattle, the storefront last week carried pieces accented in a deep red, while J. Crew had snowflakes stenciled onto its windows. But the only hint of Christmas in the foyer: hanging, potted plants accented by deep red blooms.

Hoch, the professor, said some places are still quite subtle about promoting early. "If malls started decorating early — that would be an assault on the senses."

Monica Soto Ouchi: 206-515-5632 or msoto@seattletimes.com

E-mail E-mail article      Print Print      Share Share

More Business & Technology

UPDATE - 09:46 AM
Exxon Mobil wins ruling in Alaska oil spill case

UPDATE - 09:32 AM
Bank stocks push indexes higher; oil prices dip

UPDATE - 08:04 AM
Ford CEO Mulally gets $56.5M in stock award

UPDATE - 07:54 AM
Underwater mortgages rise as home prices fall

NEW - 09:43 AM
Warner Bros. to offer movie rentals on Facebook

More Business & Technology headlines...

advertising


Get home delivery today!

Video

Advertising

AP Video

Entertainment | Top Video | World | Offbeat Video | Sci-Tech

Marketplace

Advertising