Bully parties on while the masses burn:
High end having high time for holiday
Retail sales are brisk at upscale shops, but midscale struggles
By Janet Forgrieve, Rocky Mountain News
December 21, 2004
Retail results for the last shopping weekend before Christmas delighted luxury retailers while disappointing most other stores.
According to reports from some Denver-area malls, retailers here are tracking a national trend - upscale stores are generally hopping while midprice retailers must work harder to entice cash-strapped customers.
At Aurora Mall, results from merchants were mixed and, overall, the mall expects flat sales for the season, said general manager Tish Glenn.
"Traffic is up, the anchor store sales are up, but it's kind of a mixed bag for the smaller shops," Glenn said.
The mall's anchors, which include Sears, Foley's and J.C. Penney, have been discounting items and offering special deals since right after Thanksgiving to draw shoppers in.
Nationally, the midprice department stores have been doing the same and are expected to slash prices even further this week.
J.C. Penney Co. will open at 7 a.m. from Wednesday through Friday, offering deals on jewelry and coats. Sears is boasting discounts of between 40 percent and 60 percent on jewelry and 25 percent to 30 percent on watches from Monday through Friday, according to Bill Masterson, a company spokesman.
Sears, J.C. Penney, AnnTaylor Stores Corp., Gap Inc.'s Old Navy and Limited Brands Inc.'s Express stores were among the chains that discounted more heavily over the weekend than on the same Saturday a year ago, according to Margaret Mager, an analyst at Goldman Sachs.
"You will really see some dramatic desperation discounting" this week, said Burt Flickinger III, managing partner at Strategic Resource Group, a New York-based industry consultant. He estimated that profit margins for many retailers will be cut by 3 percent to 5 percent in the fourth quarter as a result.
ShopperTrak - a research group that does what its name implies - reported a 3.3 percent drop in national sales for the weekend compared with the same two days last year.
Still, luxury goods stores seemed to be in pretty good shape.
Saturday saw a steady throng of shoppers at the upscale retailers at Cherry Creek Shopping Center, lists in hand and determined though cheerful expressions on faces, said general manager Nick LeMasters.
"The day was everything we hoped it would be," LeMasters said. "Traffic started early and stayed strong up until 7 o'clock. And it was productive traffic, with very serious shoppers."
Sunday started slower, with football fans not venturing out until the game ended, but making up for it later in the day, he said.
At Park Meadows, sales were up for the weekend about 5 percent compared with the same weekend last year, said marketing manager Stephanie Jackson.
Stores at Belmar, Lakewood's new outdoor center, were packed with folks enjoying the sunny, mild days in between finishing their shopping.
Merchants reported that shoppers were on a serious buying mission, said marketing director Eliza Prall.
"All of a sudden, people decided it was time to buy - they didn't come in and look, they just bought," she said.
At women's apparel store J. Jill, customers met the company's sales expectations, said manager Jane Levins. Shoppers spent big on cold weather apparel including sweaters, hats, gloves and sleepwear.
At Aspen Grove in Littleton, shoppers bought enough over the weekend to boost sales over the 8 percent increase the mall estimated going into Saturday, said general manager Jill Kobe.
"The Saturday before Christmas is our busiest shopping day, and, as expected, it was this year, too," Kobe said.
Results at stores in Cherry Creek North were more mixed, said district marketing manager Christina Brickley.
Women's apparel shops, including Eccentricity, Brandis B. and Limeade, are reporting good seasons overall but were busier earlier in the month.
Nationally and locally, retailers and malls are uniformly reporting increases in sales of gift cards and certificates, a trend that's been picking up for the past several seasons.
That trend could also affect overall sales for November and December because retailers don't count the cards as sales until consumers redeem them.
Upscale retailers are reporting strong sales in some general categories including apparel, perfume and jewelry, but so far the only big breakout item is the Apple iPod.
At Aspen Grove, sales of the music player were brisk, Kobe said.
They've been flying off the store shelves at FlatIron Crossing in Broomfield as well, said marketing director Heather Drake.
Some national analysts are revising their seasonal sales growth estimates in light of the weekend's less- than-stellar showing.
Others are standing firm - the National Retail Federation reiterated its estimate of 4.5 percent sales growth over last season. An NRF survey released Monday said the average consumer still had 20 percent of his or her shopping to do, and 12 million people hadn't started yet.
"Retailers know that the holiday season is far from over," said NRF President Tracy Mullin. "With Christmas falling at the end of the week and many offices closed on Christmas Eve, consumers have extra incentive to procrastinate this year." |
