Stores hope for late rush of shopping After slow start, holiday buying is up, but still off forecasts

Discounts are lures

Home merchandise, electronics, apparel are among hot sellers


December 20, 1998|By Lorraine Mirabella | Lorraine Mirabella,SUN STAFF

Touting extended hours and extra markdowns on everything from leather coats to coffee makers, retailers are hoping an anticipated burst in spending the last week before Christmas will help make up for a slow start to the crucial holiday shopping season.

Retailers are counting on shoppers packing the stores this final week, lured by promotions and colder weather, and buying everything from electronics to home merchandise to the winter apparel that had languished on the racks during unseasonably warm weather after Thanksgiving.

If so, many say, it's not too late for the season to meet -- if not exceed -- the high expectations that have capped a strong year for retailers in Maryland and across the nation.

"We've seen a pick-up since the weather has snapped, in the last week or so," said Carol Gasper, a spokeswoman for Nordstrom's East Coast department stores. "It's put people in the holiday spirit, and it's been good and steady," helping sales of chenille sweaters and cardigans.

Other department store hot sellers include faux fur-trimmed cardigans and jackets, cashmere sweaters, aromatherapy candles and oils and anything labeled with the Tommy Hilfiger name, from jeans to fragrances to linens.

At Marley Station mall in Glen Burnie, the overflow parking lots began filling up for the first time last weekend, shoppers lined up at registers at stores such as Waldenbooks on a weekday evening and the mall has since decided to extend its hours, said Charmaine Crismond, the mall's general manager.

"Business got off to a slow start in the beginning. Weather was a factor and hindered apparel sales," Crismond said. "But [apparel] was the first thing that started to move."

Many had initially expected this year's low unemployment, high consumer confidence and a soaring stock market to produce the best holiday season of the decade. But even before the season began, some analysts lowered expectations as global economic turmoil took a toll on the stock market. Then came a spell of springlike weather just as the shopping season revved up, dampening sales of outerwear such as coats, gloves, boots and sweaters.

Instead of sales increases of 5 percent or more over last year, analysts are now calling for more modest increases.

"Three to 4 percent is just going to be on target," said retail consultant Kurt Barnard. "This is a very crucial, important weekend, no question about it."

The season is now back on track to meet even the revised forecasts, said John Konarski, vice president of research for New York-based International Council of Shopping Centers.

Sales at more than 2,500 specialty stores in 48 regional malls across the country rose 4.5 percent for the second week of the season, according to an ICSC survey released last week. Earlier surveys had shown sales flat the first weekend after Thanksgiving, then slightly off the first full week.

"People said they were going to come out because the economy is doing well," he said. "Now, there's just so many days left. I think you'll see a huge, huge rush at the end."

Slight gain

Another measure of holiday shopping, the TeleCheck Retail Index, shows sales up just 1 percent for the first 17 days of the season. TeleCheck, a check acceptance company, surveys checks written by consumers at more than 27,000 stores.

"Consumers are spending more than a year ago, but it's nothing to get excited about," said William Ford, TeleCheck's senior economic adviser. "Retailers have stocked their stores for same-store gains of 5 percent. With the first 17 or 18 days gone, they're looking at an increase but not the increase they planned for. Either consumers get out and do shopping the next few days or retailers will be disappointed."

For the first time, the Internet is playing a major role in Christmas shopping, possibly siphoning off some sales from traditional stores. Last week, America Online reported a jump in traffic to its AOL Shopping channel over last year, with 750,000 more members making their first online purchase in the first two weeks of the holiday shopping season. The most popular categories on AOL this year are toys and other items for children and babies, apparel and books and music.

Whether a last minute rush to the malls will make up for lost sales remains to be seen.

Britt Beemer, president of America's Research Group, a Charleston, S.C.-based retail marketing strategy firm, says it is unlikely that holiday shopping procrastinators will ever catch up.

In a survey of 1,000 shoppers, his firm found that only 24 percent had finished holiday shopping by last Sunday, a number that is typically 40 percent or more by that time, he said.

"What I see happening is that the universe of consumers who did not get a good start on Christmas probably will not get more than 80 percent of the shopping done," he said. "They will give more cash as gifts, and they will be buying 10 to 12 percent fewer gifts. Retailers will have to get extremely aggressive, as 49 percent of America is waiting for retailers to lower prices."

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