SHOPPING & amp; SHIPPING Retailers open up for eve shoppers

A late spending surge last year gave struggling retailers a better-than-expected holiday season.
By ANNE D'INNOCENZIO
AP BUSINESS WRITER
Shoppers -- some holding out for the best bargains, others delayed by winter storms in the Midwest -- hit the nation's malls and stores, looking for last-minute gifts on Friday, the day before Christmas.
Retailers, struggling with disappointing holiday sales throughout the season, were heartened by an uptick in traffic at malls this week, but the industry is still resigned to the fact that the 2004 shopping season won't be stellar -- the question is whether the last-minute boost will be enough to help stores meet their modest sales goals.
The exceptions have been online shopping, which is on track to be at the high end of projections, and luxury stores, which have continued with robust sales from their well-heeled customers.
That means merchants are once again finding themselves in the same position as they were last year, relying on those last-minute shoppers, who seem to be delaying their buying even later than a year ago. Last year, a late spending surge gave struggling retailers a better-than-expected holiday season. In 2002, however, the last-minute boost before and after Christmas was not sufficient to overcome December's earlier weakness.
"I didn't get a chance to shop until today. But if you know the person, it's a very easy process. And of course, there's always the ability to return," said Doris Keehan, a Queens store manager, who was loaded down with bags of jewelry and sweaters at Macy's flagship store in Manhattan. She had been working six days a week.
Checking off gifts
Meanwhile, in Philadelphia's downtown shopping district, Bonnie Brooks had checked off all but two gifts on her list by Friday morning -- gift certificates to Toppers Spa and Borders Bookstores.
"These were the last two gifts we had to buy," he said.
In Cincinnati, Ohio, and other parts of the Midwest, which were hit by a heavy snowstorm Thursday, plenty of shoppers were out doing the last-minute buying that they were supposed to do earlier in the week. Instead, they were digging out cars at home.
"If it had been like the last two days, I wouldn't have come out," said Pat Marler, who was at the Eastgate Mall in suburban Cincinnati. "I mainly needed to pick up a few odds and ends. I actually did my shopping a little earlier than usual -- luckily. I just have one more stop, then I'm heading home because it's just too cold."
Rick Pedigo from Batavia, Ohio, rushed into Eastgate Mall to get his last gift -- mall gift certificates for his wife and daughter.
Weather hindered
"If it hadn't been for the weather, I would have done this sooner. I would never been here on the last day. I get mall gift certificates because that way, [my wife and daughter] can use them in any store they want and just have a good time shopping. It's a whole lot easier on me."
Michael P. Niemira, chief economist at International Council of Shopping Centers is sticking with his latest forecasts, having lowered his sales growth forecasts to 2.5 percent to 3 percent earlier in the month. He had originally projected sales for the November and December period would be up anywhere from 3 percent to 4 percent.
The estimate is based on sales at stores opened at least a year, known as same-store sales. Same-store sales are considered the best indicator of a retailer's health.
Sales for the week ended this Saturday are slated to be released early next week.
Robust sales
Meanwhile, online sales have been robust. Internet research firm comScore Networks Inc. said online sales in November and December are tracking at the high end of its forecast of a 23 percent to 26 percent gain from the year-earlier period.
The final days before Christmas and post-holiday business, boosted in part by gift card sales, have become increasingly important for retailers. Gift card sales are not recorded on a retailer's balance sheet until the cards are redeemed.
According to the International Council of Shopping Centers, the seven-day period ended Dec. 27 accounted for 20.6 percent of holiday sales in 2003, up from 19.6 percent in 2002.
The seven-day period ended Jan. 3 accounted for 14.1 percent in 2003, up from 12.8 percent in 2002.
Retailers are even trying to extend the online season. In fact, walmart.com reported that online gift sales tripled from a year ago, helped this past week by a sales spurt in virtual gift cards, which allow the giver to send festive messages, along with the gift amount, via e-mail, according to Amy Colella, a walmart.com spokeswoman.
Much busier?
While Christmas Eve day is not traditionally a big sales generator, Ellen Tolley, a spokeswoman at the National Retail Federation, believes it could be much busier than in years past because this year it's a federal holiday, providing shoppers the opportunity to do more buying on that day.
With merchandise like cashmere sweaters, coats and jeans piling up on stores' floors, merchants are hoping for big sales Friday.
Margaret Mager, an analyst at Goldman Sachs, estimated that inventories are up 5 percent at big chains like J.C. Penney Co. Inc. and Target, and up as high as 15 percent at mall-based specialty stores like AnnTaylor Stores Corp.
The same mid- to-low-priced stores, who have wooed customers with expanded hours and deep discounts, are doing it again at the season's finale. From Wednesday through Friday, J.C. Penney Co. had a 7 a.m. opening, offering deals on jewelry and coats. Sears offered discounts of between 40 to 60 percent on jewelry and 25 percent to 30 percent off of watches from Monday through Friday.
Those discounts are likely to be stepped up even more after Christmas, particularly in apparel, according to Tamara Pattison, vice president of products for Cairo.com, an online shopping resource that helps consumers track deals locally.