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Ready, set, shop: Holiday calendar, retailers' struggles will mean big discounts

Holiday decorations on sale at the Kohl's store

Holiday decorations on sale at the Kohl's store in Jericho. Experts say this holiday shopping season will see bigger discounts than usual. Credit: Linda Rosier

The time is ripe for consumers to take advantage of worried retailers' big deals.

That’s according to retail experts, who said the shortened 2019 holiday season will translate into discounts that are deeper and earlier than normal. 

 This year, Thanksgiving is Nov. 28, the latest date it can be. That leaves the Thanksgiving-to-Christmas shopping season with six fewer days than last year. 

And since Christmas falls on a Wednesday, retailers will likely boost their promotions because of concerns that the Saturday before Christmas, referred to as Super Saturday and often the biggest shopping day of the year, might not give customers enough of a sense of urgency about rushing out to stores, retail analysts said.

“It’s going to be a tricky season for retailers and an opportunistic season for consumers,” said Marshal Cohen, a retail industry expert at the NPD Group, a market research firm based in Port Washington.

The struggles facing brick-and-mortar retailers that have led to the closings of unprecedented numbers of stores in recent years have some retailers on edge this season, too.

The number of major store closings announced in the United States so far this year, 9,052, already far exceeds the total announced last year, 5,844, according to Coresight Research, a Manhattan-based retail analysis provider.

Long Island closings in the last 12 months have included three Kmarts, two Sears, a Gap in Port Jefferson, 11 locations of plus-size women’s clothing chain The Avenue, a Modell’s Sporting Goods in Farmingdale, women’s plus-size clothing store Catherines in Carle Place, J.C. Penney at Smith Haven Mall in Lake Grove and a Target in Commack.  Also, women's clothing retailer Dressbarn is in the process of closing all of its stores, including the 17 on Long Island.

But the local retail scene is still strong and faring better than that of most other parts of the country, partly because of the area's high median income, retail experts said.


 

What’s hot?

Some of the most-anticipated holiday gifts include video game systems, such as Nintendo Switch Lite and SEGA Genesis Mini, as well as toys, such as Owleez, an interactive flying baby owl toy; Blume Dolls, with foam hair that  "grows" when kids water them; Candylocks, scented dolls with long hair that looks like cotton candy; and Swag, a new fashion doll from L.O.L. Surprise! O.M.G.,  according to Adobe Analytics, a division of San Jose, California-based software company Adobe Inc. 

There isn’t a lot of innovation in the toy industry this year but products tied to upcoming blockbuster movies, such as “Frozen 2” on Nov. 22 and “Star Wars: The Rise of Skywalker” on Dec. 20, will help boost toy sales, Cohen said.

But what are people of all ages actually asking for?

Gift cards are the most popular item on wish lists for the 13th year in a row, according to a survey conducted by the National Retail Federation, a Washington, D.C.-based trade group.  In fact, 59 percent of people are requesting gift cards, followed by 52 percent who want clothes and accessories, 35 percent asking for books/movies/music/video games and 29 percent who want electronics. 

Experiential gifts, such as gift cards to movies, restaurants, shows, fitness classes and spas, are gaining in popularity, Cohen said.  A record 46 percent of people plan to buy experiential gifts this year, compared to 41 percent last year, according to the NPD Group. 

Club Pilates franchisee David Wolk said about 80 percent of the gift cards that customers redeem for classes and merchandise at his fitness studios in Woodbury and Commack are purchased in November and December. He plans to open a Melville location in April.

Often gift cards are purchased for people who have never taken a Pilates class.

"We have people who come in and say, 'My husband, my wife, my girlfriend has always wanted to try Pilates and I want to give them a gift card to get them started," Wolk said.

So, he sees the gift cards as a form of free marketing, he said.

How will this year stack up for retailers?

There is nowhere to go but up, according to one expert.

“It’s going to be much better than last year but that’s primarily [because] last year was so bad,” said James Bohnaker, associate director and economist in the Boston office of IHS Markit, a market information firm headquartered in London.

Last year, retailers saw their holiday sales increase by only 2.1 percent to $701.2 billion compared to the same two-month period in 2017, making 2018 the worst year for growth since 2009, when the United States was in a recession, Bohnaker said.

The season was hurt by several factors, including the stock market plunging 15 percent in the three weeks leading up to Christmas, concern over tariffs and the U.S. trade policy, and uncertainly leading up to the federal government shutdown a few days before Christmas that left 1 million workers unsure about their paychecks, he said.

IHS predicts sales will increase 4.6 percent to $733.7 billion this holiday season compared to the previous one,  better than the average holiday sales growth of 3.8 percent since 2010.

Retail sales are strong now because job growth is good, the unemployment rate is low and wages are growing, Bohnaker said.

But three brick-and-mortar retail categories will see sales declines this holiday season — department stores, electronics and appliance stores, and clothing and accessories stores — because they will be hurt by tariffs and by consumers buying more of those goods online, he said.

Cohen is projecting holiday sales increases of 2.7 percent for the nation, and 2.8 percent to 3.2 percent for Long Island.

Online sales will continue to siphon off larger portions of holiday spending.

This year, 21.1 percent of all holiday sales will occur online, bypassing last year’s 18.6 percent and setting a new record, IHS said.

“A lot of the major retailers have invested quite heavily in their supply chain and shipping speeds.  And they’re offering cheaper and quicker.  And that’s very appealing to consumers,” Bohnaker said.

Morolay Children’s Boutique, a 20-year-old shop in Huntington, does not sell products online or ship purchases to customers, owner Leah Casabona said.

The period of December through March remains the busiest time of year for the high-end shop because of purchases of holiday and communion attire for children, she said.

Internet competition has reduced the boutique’s sales by about 30 percent over the last three years, but Morolay has managed to hold its own because of its personalized service and extensive selection of specialty attire, she said. 

“I love seeing people and talking to them.  And I want them to touch the items … rather than looking at the pictures,” said Casabona, who said the boutique is offering 20 percent discounts on in-stock dresses in celebration of its 20th anniversary.

When, where are the deals?

Retailers are worried this year because there are six fewer days between Thanksgiving and Christmas, which is when the bulk of holiday shopping occurs, so some companies have expanded their holiday promotions or started them earlier than normal.

Also, retailers have a tendency to panic, so the deals will be bigger in December, said Ray Hartjen, a spokesman for RetailNext, a San Jose-based retail analytics company.

"I would expect big promotions to come up in mid-December.  Consumers, if they're not too engulfed in the fear of missing out ... if they have a little bit of patience, I'll think they'll be rewarded with price promotions," he said.

Walmart launched its holiday savings Oct. 25, the earliest it has ever done so, to offer customers “a jumpstart on their holiday shopping with deals on top items in electronics, gaming, toys, home and sporting goods while supplies last,” the world's largest retailer said.

Also, Walmart is offering several new tech-enabled ways to shop, including free next-day delivery, a toy catalog that can be scanned with iPhones and other Apple devices for purchasing, and a Gift Finder on Walmart.com that provides personalized gift recommendations.

Target’s shopper loyalty program, Target Circle, was rolled out nationwide Oct. 6, and holiday perks have been added, such as early access to Black Friday doorbusters and special sales on clothes, TVS and other items throughout the holiday season.

Also, new this season, Target customers can get same-day deliveries with Shipt when making purchases from Target.com and the Target app.

New this year at Kohl’s will be Cyber Week, which will start Nov. 30 and give customers who shop in-store Kohl’s Cash valued at $5, $10 or $15.  Also, new is the Daily Deal Reveal, which kicked off Nov. 7 and offers almost 20 days of sales between November and December.

Though retailers are ramping up deals because of the shortened holiday shopping season, some retail experts say the calendar won’t make a difference.

Consumers’ number of family members and friends they shop for remain the same, as do their budgets, no matter how many days are in the shopping season, experts said.

“How many less people are on your gift list because there are less days? … How much money do you have more or less of in your pocket because there are a couple of less days?” Cohen asked.

Deal Days

Black Friday:  Best day for online deals on appliances and sporting goods, when they will be discounted by an average of 9% and 6%.

Dec. 1:  Best day for online deals on toys, which will be discounted by an average of 32%, and computers, which will be marked down an average of 18%.

Cyber Monday (Dec. 2): Biggest discounts on TVs, averaging 19%.  

Dec. 3: Best day for online purchases of furniture and bedding, which will be marked down an average of 10%, and tools and home improvement goods, 6%.

Source: Adobe Analytics

$1,047.83

Average amount shoppers plan to spend this holiday season, up 4 percent from the $1,007.24 they said they would spend last year.

Source: National Retail Federation survey

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