NEW YORK – Did stores shoot themselves in the foot?
Major retailers like Target and Macy’s offered holiday discounts as early as November and opened stores on Thanksgiving Day. It was an effort to attract shoppers before Black Friday, the day after Thanksgiving that traditionally kicks off the holiday shopping season.
Those tactics drew bigger crowds, but failed to motivate Americans to spend.
A record 141 million people were expected to shop in stores and online over the four-day Thanksgiving weekend that ended Sunday, up from last year’s 137 million, according to the results of a survey of nearly 4,500 shoppers conducted for The National Retail Federation.
But total spending is expected to fall for the first time ever since the trade group began tracking it in 2006, according to the survey that was released on Sunday. Over the four days, spending fell an estimated 2.9 percent to $57.4 billion.
The survey underscores the challenges stores have faced since the recession began in late 2007. Retailers had to offer deeper discounts to get people to shop during the downturn, but Americans still expect those “70 percent off” signs now during the recovery.
And stores may have only exacerbated that expectation this year. By offering bargains earlier in the season, it seems they’ve created a vicious cycle in which they’ll need to constantly offer bigger sales. Shoppers who took advantage of “holiday” deals before Thanksgiving may have deal fatigue and are cautious about buying anything else unless it’s heavily discounted.
“The economy spoke loud and clear over the past few days,” said Brian Sozzi, CEO and chief equities strategist at Belus Capital Advisors. “We are going to see an increase in markdowns.”
Matthew Shay, president and CEO of The National Retail Federation, said that the survey results only represent one weekend in what is typically the biggest shopping period of the year. The combined months of November and December can account for up to 40 percent of retailers’ revenue
Overall, Shay said the trade group still expects sales for the combined two months to increase 3.9 percent to $602.1 billion. That’s a higher pace than the 3.5 percent pace in the previous year.
But to achieve that growth, retailers will likely have to offer big sales events. In a stronger economy, people who shopped early would continue to shop throughout the season. But that’s not the case in this tough economic climate.
“It’s pretty clear that in the current environment, customers expect promotions,” Shay said. “Absent promotions, they’re not really spending.”
At least a dozen major retailers opened on Thanksgiving instead of on Black Friday, which is typically the biggest shopping day of the year. Walmart, Toys R Us and other retailers said on Friday that Thanksgiving crowds were strong.
But Black Friday sales fell 13.2 percent from 2012,according to ShopperTrak.
Major retailers like Target and Macy’s offered holiday discounts as early as November and opened stores on Thanksgiving Day. It was an effort to attract shoppers before Black Friday, the day after Thanksgiving that traditionally kicks off the holiday shopping season.
Those tactics drew bigger crowds, but failed to motivate Americans to spend.
A record 141 million people were expected to shop in stores and online over the four-day Thanksgiving weekend that ended Sunday, up from last year’s 137 million, according to the results of a survey of nearly 4,500 shoppers conducted for The National Retail Federation.
But total spending is expected to fall for the first time ever since the trade group began tracking it in 2006, according to the survey that was released on Sunday. Over the four days, spending fell an estimated 2.9 percent to $57.4 billion.
The survey underscores the challenges stores have faced since the recession began in late 2007. Retailers had to offer deeper discounts to get people to shop during the downturn, but Americans still expect those “70 percent off” signs now during the recovery.
And stores may have only exacerbated that expectation this year. By offering bargains earlier in the season, it seems they’ve created a vicious cycle in which they’ll need to constantly offer bigger sales. Shoppers who took advantage of “holiday” deals before Thanksgiving may have deal fatigue and are cautious about buying anything else unless it’s heavily discounted.
“The economy spoke loud and clear over the past few days,” said Brian Sozzi, CEO and chief equities strategist at Belus Capital Advisors. “We are going to see an increase in markdowns.”
Matthew Shay, president and CEO of The National Retail Federation, said that the survey results only represent one weekend in what is typically the biggest shopping period of the year. The combined months of November and December can account for up to 40 percent of retailers’ revenue
Overall, Shay said the trade group still expects sales for the combined two months to increase 3.9 percent to $602.1 billion. That’s a higher pace than the 3.5 percent pace in the previous year.
But to achieve that growth, retailers will likely have to offer big sales events. In a stronger economy, people who shopped early would continue to shop throughout the season. But that’s not the case in this tough economic climate.
“It’s pretty clear that in the current environment, customers expect promotions,” Shay said. “Absent promotions, they’re not really spending.”
At least a dozen major retailers opened on Thanksgiving instead of on Black Friday, which is typically the biggest shopping day of the year. Walmart, Toys R Us and other retailers said on Friday that Thanksgiving crowds were strong.
But Black Friday sales fell 13.2 percent from 2012,according to ShopperTrak.