Stores resisted last year’s big deals
spent a year ago. She said she’ll be looking for deep discounts when she heads to stores this weekend.
“I just want to be cautious,” said Romanello, 47, who has two children, ages 12 and 15. “If it’s a great deal, I will consider.”
The price slashing might be good news for shoppers, but it hurts stores. Their profits likely will suffer in their lastditch effort to boost sales during the two-month holiday shopping period, a time when they can make up to 40 percent of their annual revenue.
To be sure, stores have been offering discounts throughout the season, but they resisted the blockbuster deals that ate away at profits last year. In fact, promotions and discounting were down 5 percent through Dec. 10 compared with last year, according to BMO Capital Markets, which tracks promotions at about twothirds of mall stores. But sales have been slow, and as of Monday, the level of discounting is now even with a year ago.
Now, stores will have to rely even more on the final days before Christmas to make up the sales shortfall.
ShopperTrak, which counts foot traffic and its own proprietary sales numbers from 40,000 retail outlets across the country, said Wednesday that the number of shoppers in stores for the week that ended on Saturday fell 4.4 percent from the year-ago period, while sales declined 4.3 percent.
As a result, the company said it would slash its sales forecast to a 2.5 percent increase to $257.7 billion, down from the 3.3 percent growth it had initially predicted.
And online sales, which have been seen as a beacon during the season, have been below expectations, too. Online sales are up 13 percent to $35 billion from Nov. 1 through Dec. 16, according to comScore, an online research. That pace is below the forecast of 17 percent for the season.
“It feels like the steam is out of the holiday since Black Friday,” said Bill Martin, ShopperTrak’s cofounder.
Indeed, many shoppers have been weighed down by concerns about their financial future. Some worry about the weak U.S. job market, while others fear the possibility that a stalemate between Congress and the White House over the U.S. budget could trigger tax increases and spending cuts known as the “fiscal cliff” next year. That would mean less money in shoppers’ pockets.
Wal-Mart CEO Mike Duke said during a speech in New York City last week that a recent poll of shoppers of the world’s largest retailer found an overwhelming majority are aware of the threat of higher taxes, which is leading some to cut back on holiday buying.