Retailers get their last-minute shopping surge, two reports confirm
NEW YORK – Procrastinators may have saved retailers this holiday season with a last-minute shopping surge that put merchants on track to meet their modest sales goals, two reports confirmed Wednesday.But retailers are also counting on a post-holiday sales boost from customers returning to stores to redeem gift cards.”Phase one at least met very modest expectations. It came late and it was uneven,” said Michael P. Niemira, chief economist at the International Council of Shopping Centers. “Now, we are in phase two, which is taking on a different character. It could make a modest Christmas into a much better Christmas.”A growing number of stores, including Wal-Mart Stores Inc., Coach Inc. and teen retailer American Eagle Outfitters Inc., rushed in fresh merchandise to boost the post-holiday business, hoping that customers will snap up some bargains and pick up some new merchandise. That could help boost fourth-quarter profitability, particularly for many apparel stores, which have had to discount heavily to lure customers.Niemira estimated that about 60 percent of gift-card redemptions occur between Dec. 26 and the end of January. Gift card sales are only recorded when customers redeem them.According to The International Council of Shopping Centers-UBS tally of about 70 retailers, sales rose 2.8 percent for the week ended Saturday, compared to the previous week, and climbed 3.9 percent compared to the year-ago period.The tally is based on sales at stores opened at least a year, known as same-store sales.Same-store sales for the month and for the November-December period are on track to meet a modest gain of anywhere from 3.0 percent to 3.5 percent, compared to a year ago.ShopperTrak RCT Corp., which tracks sales of more than 40,000 mall-based stores, reported that total sales for the week ended Saturday rose 30.3 percent compared to the previous week, and were up 25.5 percent compared to the same year-ago period.A better holiday picture will emerge next week when the nation’s retailers report their December sales results.Niemira believes that if more shoppers than expected redeem their gift cards over the next week, it would add almost one percentage point to the December results. How profitable retailers’ fourth-quarter period will be, which ends late January, depends in part on how much bargain buying and how much regular-price buying shoppers will do over the next few weeks.Burt Flickinger, managing director of consulting firm Strategic Marketing, isn’t that hopeful.”I think customers are just looking for the deeply discounted product,” he said.