Christmas in October? Wal-Mart Pushes Up Season Again (Touchpoints by Andrew Jensen)
by October 6, 2008 12:00 am 49 views
Wal-Mart Stores Inc. raised eyebrows last year when it announced Black Friday was coming three weeks early and launched a series of promotions on Nov. 2.
The strategy ended up paying off for the Bentonville retailer, which began turning around both its same-store sales numbers and its share price beginning with the onset of the nation’s economic distress that is now stretching into a second year.
Wal-Mart came out ahead during the Christmas shopping season as one of just two retailers (T.J. Maxx) to post positive same-store sales growth during the worst December sales period since 2002. Total retail sales growth for November-December was just 2.4 percent and the National Retail Federation is projecting an even more modest 2.2 percent growth this year to sales of $470 billion.
The 2.2 percent forecast is well below the 4.4 percent 10-year average and if it holds would be the worst Christmas season since the 1.3 percent growth in 2002.
The forecast reflects the most recent financial turmoil, including the failure of big-name institutions and the stock market tumble following the bailout package defeat on Sept. 29.
“You don’t have a good picture,” said Rosalind Wells, the NRF’s chief economist. “It only increases the uncertainty and anxiety.”
There is also a calendar oddity this year giving retailers five fewer days between Thanksgiving and Christmas, the main shopping season for most consumers.
With that in mind, on Oct. 1 Wal-Mart announced Christmas rollbacks on 10 popular toys for $10 each, from Barbie dolls to PlayDoh, Hot Wheels, Tonka toys and Fur Real Newborn Animals.
According to the 2008 Holiday Shopping Intentions Survey, conducted on behalf of Wal-Mart, more customers intend to start their shopping even earlier than last year when bargain-hunting was also big.
The survey said 61 percent of Americans do not plan on making cutbacks this year, and those who do plan on cutting back $50 or less.
One third of Americans plan to purchase less expensive items, start Christmas shopping earlier or to purchase presents for fewer people on their list.
Fifteen percent of Americans plan to drop someone from their Christmas list, and 13 percent plan to drop a co-worker. A full quarter of Americans plan on giving 1 to 2 fewer presents per person this year.
Electronics remain the most desired item on Christmas lists, and walmart.com is also taking pre-orders for Elmo Live, which is set to hit stores Oct. 14.
At this rate, Christmas specials may be battling back-to-school items for shelf space next year and unfortunately for most Americans, the most desired Christmas list items can’t be purchased at Wal-Mart.
In the highly-coveted “Wal-Mart mom” demographic, lower gas prices top the wish list (30 percent) followed by bringing home troops from Iraq (26 percent).
Among the overall top “wish list” results from the survey: A stable economy (13 percent), end to the Iraq war (11 percent), financial security (10 percent) and good health (6 percent).