Traverse City Record-Eagle

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December 26, 2008

Shoppers return to stores for bargains

BY BILL O'BRIEN

TRAVERSE CITY -- Heather Bockol didn't waste any time getting a jump on next year's Christmas shopping.

The Interlochen woman was up early Friday, and by late morning had a shopping cart packed with holiday lights, wrapping paper and Christmas cards at the local Target store.

"My husband gets a little crazy with the decorating, so it's a good time to buy," Bockol, 28, said, noting that most of her merchandise was reduced by 50 percent or more.

"It's what we do; it's our routine," said her friend, Vicki Deadman, of Grand Rapids.

Several area stores opened before dawn on Friday, hoping additional price cuts and clearance sales could jump-start a holiday sales season that's been anything but merry. Store officials hoped discounts would entice shoppers to redeem gift cards and use cash from returning unwanted gifts to buy something new.

Diana Stein, of the Detroit area, browsed with her family at Best Buy in Garfield Township, and looked for movies, games and a new Wii player. She had cash in pocket after exchanging an iPod accessory.

"Now that we have some return money, we're like 'hooray,'" she said. "We're looking for all the tech stuff."

Shoppers of all ages sought deals. Kyle Dotterrer of Traverse City eyed a new iPhone and accessories, thanks to his uncle who came through with Christmas cash.

"And I've got a lot of gift cards to use," he said.

But with gift card sales down this holiday season and consumers looking to save money rather than spend it, even the big discounts may not be enough to salvage what looks to be one of the most dismal holiday shopping seasons in years.

"The last week of December represents about 14 percent of Christmas sales," said C. Britt Beemer, chairman of America's Research Group. "You can't save a season with only one-seventh of the sales to go."

Several local shoppers said the Dec. 26 crowds appeared smaller than in previous years. Some national analysts said the deep discounts offered by retailers before the holiday likely dampened post-Christmas shopping enthusiasm.

The holiday season typically accounts for 30 percent to 50 percent of a retailer's annual total sales. But job cuts, portfolio losses and other economic woes convinced consumers to cut back on their spending.

Bockol and other local shoppers trimmed their Christmas budget because of the dour economy.

"I cut back a lot," she said.

Preliminary data from SpendingPulse -- a division of MasterCard Advisors that tracks total sales paid for by credit card, checks and cash -- showed retail sales fell between 5.5 percent and 8 percent during the holiday season compared with last year.

Sales of women's clothing dropped nearly 23 percent while men's clothing sales slipped more than 14 percent. Footwear sales fell 13.5 percent. Sales of electronics and appliances fell even more drastically, dropping almost 27 percent.

More consumers appeared to do their shopping online, particularly in the last two weeks of the season when storms snowed in shoppers. Online sales dipped just 2.3 percent from the 2007 holiday season, according to SpendingPulse.

A better indicator of how retailers fared will arrive Jan. 8, when major stores report same-store sales, or sales at locations open at least a year, for December.

The Associated Press contributed to this report

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