Yep, that's right. Last night kicked off the "Holiday Season." No, not the time of thanks (although "tanks" works on another level) and celebration and religious contemplation. Squeeze that in during half-time. The real reason for the season; consumer inducement to excess. While getting dragged from store to store collecting future cavities at the Camarillo Premium Outlet Mall the parents were treated to coupons for "early-bird" specials. 20% off any item after all other discounts and things like that. Nothing at Cole Haan shoes or Coach handbags, they were doing just fine it seemed. So what's this? Anecdote, nothing more. And we all know that the plural of anecdote is not data. The problem is we just cannot rely on the data. Too many people have too much tied up in spinning anything they might be able to share with respect to consumers hitting the wall or more I suspect, like my family which is both fatigued and cautious facing some fairly challenging years of tuition and such. Hopefully the WSJs Holiday Sales Blog will be back to do at least as good a job as last year. bookmark and let's see.
Rob Dawg predicts: Sales up 5.2% y-o-y. Spotty retail performance. Target, Costco, Macy's do well. Walmart does okay but doesn't meet expectations, most particularly same store sales and sales per square foot. Apple scores big attention points but while sales scream gross margins don't increase. Macs and Leopard hyper gains. HP and Sell do okay with deep discounts to noncore products; screens and such. Big products; Wii, auto leases, Transformers, DVDs. Loosers; furniture, home improvement, tools.
Okay, about that 5.2%. There is one extra weekday and the same 10 weekend days this year. Sales include gas remember. I also expect spending to show in the places that report for a slight skew and don't forget inflation, priced jumbo first quality shrimp, beer or wine this year?
I'd like some new tube socks, a roll of 23" R-13 craft batting insulation, and a remote control car the kind with with big soft wheels. I'll still be in line Friday morning at Fry's for whatever Wii package they promote and I'll also renew my vow to boycott BestBuy.
26 comments:
First, I'd like to point out:
No, not the time of tanks and celebration and religious contemplation.
Tanks and religious contemplation? Not sure what religion uses tanks... though I think they were involved with the Branch Davidians in Waco.
Secondly, you're dead on accurate for Walmart. They have already announced specials for today - day after Halloween rather than waiting for the traditional day after TurkeyDay.
The are worried about sales this year and are starting early - trying to get people in and get their money before the competition even starts.
Going to be a rough time for credit card debt in Feb... I'm thinking about Feb/March we'll see a lot of articles on credit card defaults and how this is further pushing down the housing market.
Typo noted and corrected.
Still, every year we hear this season will be better and every year the early headlines proclaim success and every year the final figures disappoint. I still see excess but it isn't the blind excess of years past.
I dunno how sales will go. Judging from the anecdotal evidence of observing my wife, I'd say that Christmas presents rank higher on the list than paying off any debt, tuition, food or clothing bills.
Needless to say, she had to cut up all her credit cards.
I ordered the Wii bundle from Gamestop. It says it is a 'pre-order', but they shipped it within 3 days of my ordering it (sitting in the closet awaiting Christmas Morning as we speak), so I think it might just be smoke to fake out ebayers or something. It was an extra $20 or so in shipping, but I have never actually seen a Wii in a store as of yet. If the line at Fry's doesn't work out, it might be a backup to get one at retail prices (and I have my own general boycott of anything that isn't on extreme sale at Fry's).
I think we'll see a lot of "shopping therapy" this year, which will keep retailers, but especially luxury retailers, doing reasonably well. Since consumers are trying to block out problems with their homes, they'll be cutting way back on home-related items (furniture, tools) and will spend more time and money on "me" items. Toys and home electronics will be strong, but clothes and chocolate (and alcohol) will do very well.
I am a tabbycat, my trolls, so what do I know, but I understand that liquor is a pretty much recession-proof business.
Sell high-end, high-margin stuff in good times and swill during bad.
I have never actually seen a Wii in a store as of yet.
I never have either. What I do see are TONS of $500 PS3's and $400 iPod's. Apple and Sony really stepped on their dicks with these products. Two months after launch, Fry's is already bundling accessories with the new iPod's in order to keep the retail prices steady. It was more than a year before Fry's was bundling accessories with the prior generation.
Regarding Wii, I suspect Nintendo has created a perceived shortage as a marketing ploy by limiting the number of units they push through the Best Buy/Wal-Mart retail channel. As you noted you can get one with no wait just by going to an online store. My neighbors did the same. Meanwhile, kiddos go to the game section of their local retailer and see they are always "sold out."
Nintendo has very smart marketing people. The "warning" they sent out via press release and the safety straps promised was a stroke of genius.
Sony and Apple will be announcing big price cuts this month. They either cut the price or deal with massive product returns come next quarter.
Every year I buy less, and every year the stores sell more. Anecdotes don't work in my case. I can't spend less than zero, which is what it will be this year. I hate xmas, it sux rox. Hate, hate, hate, and Jebus, were he alive today, would hate it too.
Akubi predicts: Fishnets up 9.8% y-o-y with sales of red ones up an astonishing 22.1% y-o-y.
Algae-free pool cleaners down 11.3% y-o-y.
Camarillo grown Koi Brand™ Sushi way up.
Sid,
I'm ITB, so I can vouch for that. However, swill has fat margins too if you buy it in bulk. And during times like now...there's no shortage of need.
However, the rich get richer no matter what, so if they're your target market, high end knows no recession. Just ask the Bordelais.
If only Marijuana were legal. Sigh....
TK, the rich do get richer (short of expropriation of their assets--but that, oddly enough, has the tendency to make everyone poorer, reference: Zimbabwe.) The issue for luxury retailers is that a lot of their goods go to people who aren't rich, they just want to look, or feel, rich.
I know this personally, even though nearly all of the few consumer goods that I buy are standard mass retail fare. The one exception for me: formal shoes. It just doesn't make sense to me to pay money for cheap department store shoes when I can buy very nice high-end shoes that, granted, cost four times as much, but last four times as long and look four times better. So I find myself buying high-end shoes, despite having a median-ish income.
If I, as the median-ish person am affected in my economic outlook, the Allen Edmonds company, despite being a luxury shoe manufacturer, will be somewhat affected as myself and other people like me are no longer able to consider the traditional cap toe balmoral oxfords in brown calf.
The luxury brands will have some insulation against economic movements, but they are far from immune. Actually, it's ultra-traditional luxury companies like Allen Edmonds and Thomas Pink who will be OK, as nearly all of their customers are sophisticated consumers of considerable means. In contrast, it is the "luxury" retailers who sell the appearance of wealth, like Gucci and Prada, who will be very much affected by an economic downturn as people of limited means are forced to give up their dreams of looking like a celebrity.
My little ones, it seems that they call him "Helicopter Ben" for a reason.
Crank up those presses at the mint...more cash into market please. must...avoid...recession...
Wouldn't devaluating the dollar right away work much faster then doing all this step by step?
Ahhhh, the good old times where you could be a millionaire in Turkey are coming to the USA.....
Dollar tanks, stock market tanks, real estate tanks...we have so many things to be tankful for.
Rob:
"If only Marijuana were legal. Sigh...."
You mean it isn't?
SHIT!!!!
(Hey, take a ride in a Bayliner right outside the 12 mile limit.)
And Rob, your Santa is really, really creepy.
Ho Ho Ho - It's Santa Flipper Clause
Many people will be getting an early Christmas present with the mortgage bailout laws that Congress is passing.
Santa F. Clause
Sweet Cashback -
Is that Peter Schiff on the Turkish currency you linked to?
@w
nope just a Google image for the Turkish lira....
I thought pot was legal in California...? At least it is in the Bay Area.
BTW, I blame EN for the fact that the #2 Goole search result for "Akubi" is PRlinkBitch. WTF?
I'm annoyed. In addition some dude in India described Baabaabaab as "a crappy bollywood blog." The horror! Anyway, did anyone else work with a pre-Tech Bubble Burst guy who described some people as "e-pansies"?
@9:40 AM, Lou Minatti
I think you are wrong about apple. Time will tell, though.
Here is an anecdote for you. When the original iPod came out, if you used that money to buy apple stock instead you would have something like shares worth ten grand now. Retailers will bundle apple products to give you an excuse to buy from them instead of apple. Not sure about sony. Sony has many problems, and you may be right about them.
Retailers will bundle apple products to give you an excuse to buy from them instead of apple.
Retailers are bundling iPod with third-party products (speakers, chargers, cases, etc.) because they the $400 iPods aren't selling and both Apple and the retailers are desperate to avoid price cuts less than 2 months after product launch. They are using every trick they have in order to preserve the perceived value.
CFC is down $3 in 3 days.
And I doubt any other banks are going to bail them out as the sharks are circling ever closer to them too.
DAH-da
DAH-da, DAH-da, DAH-da...
Swim tan boy Swimmmmm!!!
H.
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