Thanksgiving Weekend Sales Climb as Shoppers Scoop Up Deals
Nov. 28 (Bloomberg) -- Barb Capa was at Saks Inc.'s flagship store in New York feeling flush and ready to buy.
"I just feel like spending more because of an increase in my salary," the 22-year-old nurse from New York said today. In 2009 Capa spent $1,000 during the holiday season. This year she is ready to "splurge" and drop five times as much on designer bags, clothes and shoes.
She's not the only one. The average shopper spent 6.4 percent more than last year over the holiday weekend, the National Retail Federation said today. Retailers, looking to make the most of their biggest shopping period, wooed customers with promotions like slow-cookers for $7.88 at J.C. Penney Co. and $5 Barbies at Wal-Mart Stores Inc.
U.S. retail sales during Thanksgiving weekend totaled $45 billion as more shoppers picked up jewelry and toys, the Washington-based NRF said in a statement, citing a survey conducted by BIGresearch. More people are scouring for deals earlier, with the number of customers shopping on Thanksgiving Day more than doubling over the past five years.
On Black Friday itself, so named because many retailers become profitable on that day, traffic rose 2.2 percent, ShopperTrak said yesterday. The Chicago-based consulting firm said sales rose 0.3 percent to $10.7 billion.
Many consumers who pulled back for the past two years seem prepared to spend more this holiday season, Neil Stern, senior partner at Chicago-based consulting firm McMillan Doolittle, said in a Nov. 26 interview.
'Pent-Up Demand'
"There's no question there's pent-up consumer demand that will drive retail growth this season," he said. "America is still a consumer-driven society. We just haven't had the means to indulge."
At Macy's Inc.'s flagship store in New York's Herald Square, many people were shopping for themselves for the first time in two years, Chief Executive Officer Terry Lundgren said.
Analysts' estimates for holiday sales vary from little changed to increases of as much as 4.5 percent. The Washington- based National Retail Federation predicts a gain of 2.3 percent to $447.1 billion after an uptick of 0.4 percent last year and a 3.9 percent drop in 2008.
Those forecasts coincided with a rebound in U.S. consumer spending this year as the economy began adding jobs. Consumer spending, which accounts for about 70 percent of the U.S. economy, increased at a 2.8 percent annual rate in the third quarter, according to the Commerce Department. That was the fastest since the final three months of 2006.
First Timer
Same-store sales, a key indicator because new and closed locations are excluded, rose for 14 straight months through October. Same-store sales for November and December may advance as much as 3.5 percent, the largest increase since 2006, according to the International Council of Shopping Centers.
Andy Bogats, a 38-year-old father of five, braved the crowds and rain on the morning of Black Friday for the first time in his life. He bought two 32-inch flat-screen Emerson televisions for $198 apiece at a Wal-Mart location outside Pittsburgh.
"We targeted these TVs, and were fortunate to get them," said Bogats, a former mortgage broker who now works in the construction industry. "Things are getting better." So much so, that he and his wife may splurge on each other this year. "We didn't do that last year," he said.
While some shoppers plan to spend more this season, others are trimming their budgets.
Shannon Parker, 39, and her sister-in-law Tracy Knapp, 42, have made a Black Friday shopping marathon an annual tradition. This year was no exception. The 12-hour shopathon took them from Wal-Mart, Target Corp. and Best Buy Co. to Kohl's Corp. and Bon Ton Stores Inc. Along the way, they snagged everything from a TV to iPod docking stations to Christmas Eve pajamas for their kids.
Prepaid Cards
There was one difference, however. Parker, a school administrator from Baltimore, put all of her purchases on prepaid credit cards to avoid busting her budget. "I'm still swiping the plastic, but it's already paid for," said Parker, who was visiting her sister-in-law in Allentown, Pennsylvania.
Some Americans plan to wait for the deals to improve. One is Debbie Schwig, who declined to buy anything when she visited Apple Inc.'s Fifth Avenue store in Manhattan yesterday with her husband and dog.
"We're here to check things out today," said the 47-year- old nurse from Hoboken, New Jersey. "We'll wait until vendors get more desperate."
Going Online
Others opted to avoid the bedlam of Black Friday altogether. Bridget Hujsa, a teacher from Bethlehem, Pennsylvania, is buying nearly all of her gifts online at Target and Gap Inc.'s Old Navy, where she found discounts on clothes and baby toys for her 7-month-old son.
"I prefer online," she said. "You don't have to drive and deal with the crowds."
She may get her chance tomorrow on Cyber Monday, known as the kickoff for the online holiday shopping season. More than 106 million people are projected to surf the Internet for deals tomorrow, according to the NRF. Best Buy, for example, began a two-day Cyber Monday sale today with discounts on 32-inch LCD televisions and Dell Inc. laptops.
To contact the reporters on this story: Lauren Coleman-Lochner in New York at llochner@bloomberg.net Yi Tian in New York at ytian8@bloomberg.net
To contact the editor responsible for this story: Robin Ajello at rajello@bloomberg.net
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