Get the most out of holiday shopping
Consumers are in the driver's seat this shopping season, according to retail analysts.
"Consumers are not in a rush to start shopping, but give them a good deal and they will jump all over it," said Marshal Cohen, chief industry analyst for The NPD Group, a Port Washington market research firm.
The type of strategies retailers will employ to pull those shoppers in largely depends on their core consumer, said Scott Balestrier, tax partner for consulting firm BDO USA Llp's retail and consumer products unit. Retailers whose customers are more affluent are increasing inventories and product variety, he said, and are less focused on deep price discounts.
The upscale Americana Manhasset is focused on customer service and is expanding its personal shopper suite from two rooms to four, said Deirdre Major, president of the mall. Charitable and shopping events are planned by the mall as well as by individual stores.
"Our focus is to help elevate the caliber of customer service," she said. "Clientele-ing is a big thing here, keeping customers involved and building relationships with customers so you know how to best service them."
But for mass retailers, price is key.
"Kohl's and JCPenney's customers may not be the six-figure customers, so they are focusing on pricing and pricing early before the season," Balestrier said. "The concern is if someone has $100 to spend, I want to get them in the store on Nov. 19 and not Dec. 5 . . . as opposed to Bloomingdale's, who might have more luxury to wait."
Steven Tanger, president and chief executive of Tanger Factory Outlet Centers Inc., says that the company, which has locations in Riverhead and Deer Park, is in a position to benefit from the wary consumer psyche and the continuing shift toward bargain hunting.
"We are in the sweet spot," Tanger said. "[Customer] traffic at Deer Park is up over 30 percent in the month of October [from last year], and in addition traffic at our 15-year-old center in Riverhead is up 7 to 10 percent."
People are buying cheaper everyday products in order to have money to spend on other items, like apparel, said David Blumenfeld, vice president of the Syosset-based Blumenfeld Development Group Ltd., which partnered with Tanger and Apollo Real Estate Advisors to build the Arches.
In addition, he said, full-price retailers aren't discounting as steeply as they once did, which is pushing more shoppers to the outlets.
"We are seeing the better-quality brands being more successful than the middle of the market," he said.
The consensus among analysts is that holiday sales will increase over last year, though modestly. Retailers have learned lessons from the past two years and are keeping inventories tight to avoid having to sell products at huge markdowns. The National Retail Federation is forecasting 2010 holiday sales will rise 2.3 percent over last year, to $447.1 billion. The International Council of Shopping Centers is expecting a 3 percent to 3.5 percent increase.
But about 42 percent of consumers said that a sale or discount is the primary factor influencing their decision to buy, according to the National Retail Federation survey - an attitude that retailers of every stripe are paying attention to.
"I think consumers now are more focused on bargains and savings and value more than ever before," said Gregg Richard, president of P.C. Richard & Son. "We are doing some really aggressive promotions earlier than we ever have in both appliances and electronics."
The Farmingdale-based appliance and electronics chain began offering its employee discounts to the public a week earlier than last year and plans to continue the sales through Wednesday.
Smaller retailers like Jake's Island Outpost, a Huntington shop that sells items with a "Life is Good" slogan, are sensitive to their consumers' budgets. The shop sells products bearing the message of optimism, priced between 50 cents and $50, and offers a buy-nine-get-one free loyalty program, said William Weller, who owns the store with his wife, Jean Ann.
Ooh La La's five boutiques are hosting several holiday sales events, including Pink Friday a week after Black Friday. Jenny Montiglio, owner of the local chain, says she's keeping her inventory tight but is responsive to her customers.
"I am lucky because I get a lot of feedback from my customers," Montiglio said. "They'll tell us if they are getting something cheaper or a better price someplace else or [if] there are more sales in other stores."
Consumers are also indicating they will be using credit cards less than last year, said Britt Beemer, head of America's Research Group, a Charleston, S.C, market research firm. His company's survey revealed that last year consumers used cards for about 38 percent of their gift spending but this year they intend to use cards for only 15 percent of their gift budget, he said.
In addition, he said, Walmart's announcement of free online shipping reveals a concern about weak sales levels.