Retailers: Holiday Forecast Hazy

Retailers: Holiday Forecast Hazy
Black Friday crowds were robust, but retailers’ concerns were not quelled.

NEW YORK — While Black Friday and Thanksgiving weekend sales gave some retailers a much-needed sales boost, the forecast for the rest of December is cloudy at best.

“The holiday season is going to be dependent on the economic news that’s out there,” said Peter Hanig of Hanig’s Footwear in Chicago. Though Hanig said Thanksgiving weekend was “surprisingly strong,” beating last year’s numbers, he’s not counting on a sales surge during the weeks leading up to Christmas. “We’re pushing business on gifts and increasing our promotional effort, but no one has a crystal ball on this one,” he said.

Jeff Mintz, an analyst with Wedbush Morgan was even more cautious. “Several things lead us to conclude that the strong start to the holiday shopping season does not suggest a strong overall season,” he wrote in a note to investors early last week. Mintz insisted that the shorter period this year between Thanksgiving and Christmas — 27 days in 2008 compared with 32 days last year — pressured consumers to shop early. Steep markdowns were another draw.

“Both the extent and level of Black Friday markdowns were well above last year and drove signifi cant bargain hunting — and, we believe, self purchase,” he wrote. Mintz also noted that footwear, with the exception of Uggs and slippers, isn’t considered a gift item, which could hurt pre-Christmas purchases.

“December is going to be a tough month ahead. We’re very promotional right now and we’ll be more aggressively promotional going forward,” said David Fenwick of children’s store Sandy’s Shoes in Austin, Texas. Fenwick said the durable and comfortable Japanese brand Tsukihoshi has been performing exceptionally well for the store, while other brands are suffering due to dwindling consumer confidence.

“Anybody who’s been in business long enough may have thought that the kids’ business was recession-proof because kids need shoes, and parents will spend on kids before themselves,” he said. “But [parents] are going to be buying based on need more than they have in years.”

To entice holiday shoppers to spend, some retailers are banking on in-store and community events.

Jessica Lynn, owner of Leokadia designer shoe boutique in Boston’s South End, is eager for the local holiday shopping fair, which usually attracts around 11,000 people.

“I remain very optimistic,” said Lynn. “We’re still a new store, so we get new customers. And I may do a markdown even though it isn’t necessary because some people are just looking for a bargain.”

In an effort to drive sales, Bon-Ton is also having more events this season. “Everything is more event driven,” Paul Kilian, divisional VP of product development, told Footwear News during FFANY here last week.

Bon-Ton said the department store chain sold more than 40,000 pairs of private-label boots over the Thanksgiving weekend, but added that shoe shopping at Bon-Ton typically peaks on Black Friday.

At V&A Bootery, in Kalamazoo and Portage, Mich., owner Ed Sanders plans to start his winter sale about a week before Christmas rather than immediately after. But instead of aggressive markdowns, Sanders has been implementing in-store initiatives to drive sales, including an event in October where a graffiti artist decorated Uggs customers.

And Ugg continues to be the bright spot for many retailers. The popular boots were among the top four products purchased on  Black Friday, according to online comparison site

“The Ugg business has been fabulous for us,” said Sanders, who was also in town for FFANY. “We were up in November for one reason: Ugg boots.”

“Ugg continues to be a top seller for us,” added Steve Hill, VP of merchandising for

Hill has high hopes for the rest of the season, thanks to a strong Black Friday for the Las Vegas-based e-tailer. “We expect to have record-setting days and a record-setting holiday season for Zappos,” he said. “We had a more than 5 percent increase for both Black Friday and for the [Thanksgiving] weekend.”

Online retailer also had a successful Black Friday, with numbers up 33 percent, but Internet Director Jodi Bresina is cautious about the rest of the season. Calling out deals for the customer is essential over the next few weeks, she said.

“Last year, we did a $20-off promotion on an $80 purchase. This year, we’re doing that plus $10 dollar off a $50 purchase,” said Bresina. The site also implemented a gift center this year, highlighting products for less than $50 and $30.

“This, by far, is the most unique holiday we’ve ever faced, and there is no complete picture yet,” she said. “But as an online retailer, we have a tremendous advantage. We theoretically could change a promotion mid-day if we wanted. That’s the beauty of online shopping. We can react quickly.”

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