NEW YORK — Despite being the perfect stop for procrastinators, most of the nation’s mass market retailers did not have the rush they had hoped for in the waning days, hours and even minutes of holiday shopping.
“It wasn’t as strong as we’d hope,” said Mark Griffin, president and chief executive officer of Lewis Drug in Sioux Falls, S.D. Other mass retail executives agreed with Griffin’s assessment and estimated that gains will be held to around 4 percent over last year. The National Retail Federation, which also tracks department stores and other retailers, expects total sales to rise 5 percent to $457.5 billion, the lowest increase since 2002.
However, on Monday, ShopperTrak RCT, a Chicago-based researcher that tracks retail sales, said holiday sales had fallen short of expectations. Black Friday retained its standing as the busiest day this year with sales of $8.96 billion, with the Saturday before Christmas — dubbed Super Saturday — totaling volume of $8.72 billion, according to ShopperTrak.
Griffin of Lewis Drug attributed the somewhat weaker season to several factors, including warmer-than-usual weather and changes in how consumers shop for the holidays. In particular, he said consumers are on the prowl for electronic items and gift cards. Both of those categories nudge out beauty, which up until a few years ago was a perennial gift-giving favorite. The economy is baffling many retailers, who said there are families feeling the pinch of rising gasoline costs and lowered home values, yet there are shoppers armed with the cash for flat-screen TVs and Ugg boots.
To that end, Lewis Drug and other retailers such as ShopRite, Walgreens and CVS, beefed up assortments of MP3 player accessories, TVs, digital cameras and even DVDs. Lewis Drug, for example, had a 37-inch flat-screen TV available for less than $800.
Another pleasant surprise, according to Griffin, was the trim-a-tree category, as Americans looked for ways to improve the value of their home with upgraded decorations. In particular, he lauded the pre-decorated and pre-lit trees. At Walgreens, the company also singled out its “As Seen on TV” items, including Chia Guy, the Cold Heat Soldering Tool and the Spin Spa Brush.
Many industry experts think the availability of sharply priced items at more outlets siphoned some sales from the discounter Wal-Mart.
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The shift to buying a TV or digital camera in mass market retailers took a toll on cosmetics and fragrances in food, drug and mass doors. But it wasn’t only Americans’ obsession with gadgets that tarnished beauty this Yule. “Many companies are pushing mature items such as skin care and not the youth market,” observed Griffin. “Usually the youth market spikes sales [during holidays], and we didn’t see many youth hits.”
One leading beauty manufacturer agreed but insisted suppliers offered unique, youth-oriented items that buyers bypassed. “There just wasn’t anything in the stores that looked giftable. And, what was out there, such as Markwins kits, looked the same in every store,” the source said. The Markwins kits, as usual, did have a clean sell-through, with many items priced below $10.
Fragrances — ranging from classics, such as White Shoulders, to celebrity scents, including Britney Spears Curious — squeaked out a decent year in sales volume, but retailers moved product with price reductions and promotions. “Celebrity is still good, but it did slow down a little. There just weren’t any door-busters,” Griffin lamented. Retailers hauled out promotions such as Rite Aid’s “buy one, get another 50 percent off on designer scents.”
Still, two days before Christmas, there were consumers prowling the aisles. Walgreens not only stayed open Christmas Eve but had store hours on Christmas Day, too. An observation of the parking lot showed it was packed on the 25th. Walgreens also served as a last-minute beauty stop, with gift bags priced and ready to go.
Ulta was also buzzing during Christmas Eve day with shoppers grabbing last-minute items, especially those priced under $20. One shopper beamed as she picked up a Bare Escentuals eye kit with eye shadow and a brush for $9.99. Ulta was also moving a great deal of gift cards, especially to baffled men. Among the other big sellers were Vera Wang Princess, Bare Escentuals gift assortments and hair appliances, according to an Ulta sales associate.
The warm weather had good and bad effects on shopping. Pleasant weather in November brought more shoppers out who actually started buying early, said Griffin. But then warm weather in December lessened shopper interest in the holiday season.
Regarding lessons for next year, Wendy Liebmann of WSL Strategic Retail published her Pulse report suggesting that shopping trips aren’t increasing. Therefore, retailers need to do more to boost the shopping basket. This could be the perfect time for beauty to regain its role as an item shoppers seek for holidays — in addition to that flat-screen TV.