Hol­i­day shop­ping:

Growth pre­dic­tions cut for hol­i­day; big dis­counts ex­pected.

Austin American-Statesman - - FRONT PAGE - By Candice Choi and Mae­an­der­son

Pro­cras­ti­na­tors find big­ger deals and lighter crowds but leave re­tail­ers aching.

NEW YORK — Shop­pers who waited un­til the fi­nal days be­fore Christ­mas were re­warded with big bar­gains and lighter crowds. But their last­minute deal hunt­ing may hurt stores.

Although fresh data on the hol­i­day shop­ping sea­son won’t be avail­able un­til Christ­mas, an­a­lysts ex­pect growth from last year to be mod­est. Sev­eral fac­tors have damp­ened shop­pers’ spir­its, in­clud­ing fears that the econ­omy could fall off the “fis­cal cliff,” trig­ger­ing tax in­creases and spend­ing cuts early next year.

On Christ­mas Eve, Taub­man Cen­ters, which op­er­ates 28 malls across the coun­try, re­ported a “very strong week­end.” But many last-minute shop­pers in cities in­clud­ing New York, At­lanta and Indianap- olis were spend­ing less than they did last year, and tak­ing ad­van­tage of big dis­counts of up to 70 per­cent that hurt stores’ prof­its.

Kris Bet­zold, 40, of Carmel, Ind., was out at the Fash­ion Mall at Key­stone in Indianapolis on Mon­day look­ing for deals on toys, and said she’s no­ticed the sales are “even bet­ter now than they were at Thanks­giv­ing.” She said the econ­omy has prompted her and her hus­band to be more fru­gal this year.

“We un­der-bud­geted our­selves by $400 for Christ­mas be­cause we just wanted to put that money back in sav­ings,” she said.

Other last-minute shop­pers said they were hold­ing off as much as pos­si­ble for even big­ger post-hol­i­day sales.

Chris Ailes, a 37-yearold TV pro­ducer, was at Lenox Square mall in At­lanta on Mon­day to pick up last-minute gifts for his mom and grand­mother. With the econ­omy so shaky, he and his fam­ily are try­ing to cut back on spend­ing. So he said he’s look­ing for­ward to dis­counts af­ter Christ­mas.

“That’s when the sales are go­ing on,” he said.

At Macy’s in New York, shop­per Mau­reen Whyte had a sim­i­lar game plan in mind. Whyte, a 33year-old who works for an in­surance com­pany, was pick­ing up last-minute stock­ing stuffers for her kids. For some toys, how­ever, she was hold­ing off for the post-Christ­mas sales and her kids un­der­stood why.

“I told them, ‘What­ever Mommy didn’t get you, you’ll get af­ter this week,’ ” she said, not­ing that her chil­dren, ages 5 and 10, are fine wait­ing as long as they know they’ll even­tu­ally get their toys.

That’s grim news for re­tail­ers, which typ­i­cally get 40 per­cent of their an­nual sales in the crit­i­cal Novem­ber-to-De­cem­ber pe­riod. Although the week af­ter Christ­mas is con­sid­ered part of the sea­son, by that time re­tail­ers are backed into a cor­ner since it’s their last chance to get rid of items that have been sit­ting on shelves for months. The steep dis­counts dur­ing that time mean sales are less prof­itable.

Shop­perTrak, which counts foot traf­fic and its own pro­pri­etary sales num­bers from 40,000 re­tail out­lets across the coun­try, last Wed­nes­day cut its forecast for hol­i­day spend­ing down to 2.5 per­cent growth to $257.7 bil­lion, from prior ex­pec­ta­tions of a 3.3 per­cent rise.

On­line, sales rose just 8.4 per­cent, to $48 bil­lion, from Oct. 28 through Satur­day, ac­cord­ing to a mea­sure by MasterCard Ad­vi­sors’ Spend­ingPulse. That is be­low the on­line sales growth of be­tween 15 per­cent to 17 per­cent seen in the pre­vi­ous 18month pe­riod, ac­cord­ing to the data ser­vice, which tracks all spend­ing across all forms of pay­ment, in­clud­ing cash.

Mar­shal Co­hen, chief re­search an­a­lyst at the mar­ket re­search firm NPD Inc., said re­tail­ers will have to be more ag­gres­sive than usual with dis­counts in the days af­ter Christ­mas to get shop­pers to spend. That could mean some stores will slash prices by as much as 80 per­cent to make shop­pers be­lieve the sales are a “once in a life­time op­por­tu­nity.”

“Con­sumers are go­ing to be re­warded for wait­ing un­til af­ter the hol­i­days,” he said.

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