Post-Holiday Sales Won't Fix Spending Doldrums

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Retailers offered deep discounts over the weekend, trying to make up for the lackluster holiday shopping season. A spokesman for the National Retail Federation says the weekend after Christmas is becoming just as critical for the industry as Black Friday. That's the traditional start of the holiday shopping season on the day after Thanksgiving.


There are maybe fewer shoppers, but at least those looking for great post-Christmas deals had plenty of options this past weekend. Retailers offered deep discounts in hopes of making up for weak holiday sales. NPR's Cheryl Corley reports from Chicago.

(Soundbite of traffic)

CHERYL CORLEY: There are lots of shoppers on Chicago's Magnificent Mile, the stretch of Michigan Avenue full of high-end stores. Dawn Veech(ph), a hairstylist from Indiana, was looking for bargains.

Ms. DAWN VEECH: I didn't do as much spending this year as I usually would for Christmas, trying to be cost conscious kind of thing. So I'm hoping to catch those things I actually need now.

CORLEY: And some stores were offering rock-bottom prices on some items. Wendy Galagher(ph) of St. Louis had just finished shopping at Macy's department store.

Ms. WENDY GALAGHER: If you use your Macy's card, you get 20 percent off off-the-bat and then a lot of things are 50 percent off, so...

CORLEY: All right, you've got a couple shopping bags there.

Ms. GALAGHER: We do.

CORLEY: So you did well?

Ms. GALAGHER: We did.

CORLEY: A good deal on a purse, a coat, and some clothes. McCilley Calhoun(ph), who was shopping with Galagher, says it was obvious many stores are hurting.

Ms. MCCILLEY CALHOUN: I used to be in retail, and there's way too much on the racks for this time of year. I mean the shelves are like they were before Christmas, you know, it should be - the racks should be bare.

CORLEY: Scott Krugman, with the National Retail Federation, says the weekend after Christmas is now becoming just as critical for the industry as is Black Friday, the beginning of the holiday shopping season on the day after Thanksgiving.

Mr. SCOTT KRUGMAN (Vice President, Public Relations, National Retail Federation): The week after can account for anywhere from 15, even 20 percent of total holiday sales.

CORLEY: And now, says Krugman...

Mr. KRUGMAN: The name of the game is clearing the shelves and getting that merchandise out the doors and freeing up cash.

CORLEY: And that's why retailers are offering very aggressive post-holiday promotions. The true picture of just how their businesses fared during the holidays will come early next month, when stores release their December sales figures.

Cheryl Corley, NPR News, Chicago.

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Retailers Struggle To The Finish

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In a word, many retailers are desperate. They're trying to cram more sales into the next week or so to compensate for the past month of slow sales. One source, MasterCard, says this year's holiday sales are down between 2 and 4 percent.

"Retailers are simply trying to minimize that damage," says Scott Krugman of the National Retail Federation.

"Retailers basically have a week to help make their sales projections for 2008," Krugman says. "And I think they're going to pull every stop. They're not going to pull any punches in order to try to make this happen."

These small acts of desperation are evident everywhere. Stores are papered over with signs advertising 75 percent off. Clearance sales that normally might not start until the crocuses bloom have already arrived.

"The question is when you're competing on price, how do you stand out?" Krugman says. "I think one other thing retailers are doing this year is being more lenient on return policies."

Krugman says returns are part of a strategy to get customers to go to stores. The theory is this: Returns — along with gift cards and huge discounts — can draw people in. Once they're there, the hope is they'll be lured into making one extra purchase.

"I actually was wise when I bought this year," says shopper Russell Delange, outside the Macy's in downtown Washington, D.C. He says he has shown a lot of self-control and held on pretty tight to his wallet.

Delange is a flight attendant from South Africa. Holding a new pair of jeans he bought on sale, he says there weren't too many fellow shoppers in the stores.

That's not a good sign. Krugman says retailers emphasized after-Christmas sales very heavily this year, but the odds are against them.

"We're talking about a recession. We're talking five fewer shopping days than last year. And of course a winter storm for the last week of holiday season. I think there's a lot to make up for."

So far, he says, his trade group's members say the traffic is looking promising. But after so many months of slashing prices, the profit numbers — when they come in early next year — probably won't look so good.



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