Retailers Await Last-Minute Christmas Miracle
It ain’t over ‘til it’s over -- and that includes holiday sales.
At least, that’s what the International Council of Shopping Centers (ICSC) is predicting. The ICSC, which releases a weekly tally of chain-store sales, is predicting that this coming Saturday -- Dec. 23 -- will be the busiest shopping day in this holiday season.
Meanwhile, Consumer Reports latest survey shows one-third say they won't finish their holiday shopping until Dec. 23 or later. One-tenth won't be done until the evening of Dec. 24.
Michael Niemira, ICSC chief economist, foresees shoppers “out in force” this weekend. He maintains that same-store sales growth for December will rise 2.5% to 3.5%, year over year. And he predicts the combined November-December period will be up 2.5% to 3.0%.
Why the rose-colored glasses? After all, the initial consumer frenzy of Black Friday and its younger cousin, Cyber Monday, faded off in the days after the Thanksgiving weekend.
And many observers attributed the slowdown, in part, to a factor no human can control -- this autumn’s warmer weather. The balmy climes may be psychologically inhibiting to denizens of northern climes, dreaming of “traditional” Yuletides; and the high temperatures most certainly seemed prohibitive to sales of bulky sweaters and other wintry apparel.
But some analysts see other factors involved, including the popularity of gift cards –the National Retail Federation expects gift-card sales of nearly $25 billion this holiday season, compared with $18.5 billion last year -- and more extensive on-time shipping guarantees from sellers. Add to these the combo-platters offered by store chains like Wal-Mart, Circuit City and Best Buy, which have learned to mine the Web –finally –and coordinate online-purchase/store-pickup services. And then there are the massive discounts, driving prices ever lower.
So shoppers may well be playing the odds: betting that they’ll wait just long enough for anxious sellers to enact price cuts – or more, deeper cuts -- on their coveted gifts. They’d be gambling that the shelves and virtual warehouses, at brick-and-click retailers, will still contain merchandise right up until Santa makes his appearance – and that they’ll still be able to nab the next-to-last Nintendo Wii and Sony PlayStation 3 consoles, other top tech toys, and Pocohantas and Cinderella dolls from Walt Disney’s “Princesses” brand.
Another element sellers might see as their salvation: call it the "Goldman Sachs factor"; or substitute Morgan Stanley, Merrill Lynch, Bear Stearns or any major brokerage and investment bank. 'Tis the season for the financial giants to dole out fat bonuses to their key traders, who will presumably spread some of the discretionary wealth on gifts.
Even if last-minute shoppers succeed in their gift-getting quest, one notes that procrastination, like other minor sins, has its price -- a price with interest rates attached. The Consumer Reports survey concludes that many purchasers will be paying off their holiday debt until March; and of those paying with plastic, 17% plan to amass $1,000 or more in credit-card charges. Shopping frenzies being what they are – for an example, see the final two minutes of an eBay auction – one imagines that percentage may be even higher as the big day approaches.