Retailers dangle deals to lure shoppers

Stores are opening several hours earlier for Black Friday, honing online strategies

Bulletin wire reports /

Published Nov 13, 2012 at 04:00AM

NEW YORK — Retailers from Wal-Mart Stores Inc. to Limited Brands Inc.’s Victoria’s Secret are unveiling Black Friday deals earlier than ever or using such attention-getters as teen heartthrob Justin Bieber to lure more holiday shoppers.

Holiday-season sales are crucial for retailers across the board, since they represent the industry’s biggest quarter in terms of both sales and profit. With Hurricane Sandy pounding the mid-Atlantic and Northeast region and hurting sales in the first week of November, it also remains a question whether chains such as Macy’s Inc. and Kohl’s Corp. that had to shut stores could fully make up their lost sales.

Meanwhile, concerns about the U.S. going over the “fiscal cliff” also may overshadow holiday demand closer to Christmas, analysts have said.

Target Corp. will kick off the holiday shopping season at 9 p.m. on Thanksgiving, three hours earlier than a year ago.

“We thought long and hard about when the right opening time would be,” said Kathee Tesija, Target’s executive vice president of merchandising. She said that 9 p.m. struck “a perfect balance” for its customers.

Target plans to offer deals that include an Apex 32-inch LCD TV for $147 and a Nikon digital camera for $99.99 for the earlier opening. From 4 a.m. to noon, the next day, customers who spend $50 or more on clothing, accessories or home products will earn a $10 Target gift card to use toward a future purchase.

Target is also preparing additional early-morning specials, including Leapfrog Explorer software for $15.

Wal-Mart, the world’s largest retailer, said last week that it will open its big Black Friday promotions in toys, games and apparel at 8 p.m. on Thanksgiving, two hours earlier than last year. The retailer cited customer demand as the reason for pushing up the sales times.

Wal-Mart’s closely watched electronics deals will also be available earlier, at 10 p.m. instead of midnight, featuring promotions such as a 60-inch Vizio LED TV for $688, a $310 savings.

Wal-Mart also said that for the first time it will guarantee pricing and availability before Christmas on three electronics items — the 16GB Apple iPad 2 with Wi-Fi for $399, which includes a $75 Wal-Mart gift card; the Emerson 32-inch 720p LCD TV for $148; and the LG Blu-ray Player for $38 — for all shoppers who are in line between 10 p.m. and 11 p.m., even if the store sells out of its stock.

“Wal-Mart is positioned well for the holidays,” analyst Joe Feldman of Telsey Advisory Group told MarketWatch. “We like the company’s approach.”

Sears Holdings Corp. will open its namesake chain at 8 p.m. on Thanksgiving, ahead of its normal opening on Black Friday. Toys R Us stores will open at the same time; the first 200 shoppers in line at each Toys R Us store Thanksgiving night will get a free goody bag. Target Corp. announced Monday its stores would open at 9 p.m. on Thanksgiving.

Following the footsteps of Macy’s and Nordstrom Inc., Kohl’s also said it’s testing whether it can fulfill and ship online orders directly from its stores and expects the initiative to be “very beneficial” come next holiday. For Macy’s and Nordstrom, that option is part of their online strategy this holiday season, analysts said.

“The beauty of the whole thing is you have incremental inventory without taking the incremental inventory risk,” which leads to profit-eroding discounts, said JPMorgan analyst Matthew Boss in an interview. “It helps you turn your inventory risk.”

Getting the online piece right is crucial for retailers as more spending shifts to that channel, especially with the popularity of mobile devices. Forrester on Thursday said it expects U.S. online sales this holiday season to jump 15 percent to $68.4 billion, with the average U.S. shopper spending an estimated $419 online, a 12 percent boost from last year.

Macy’s, which on Wednesday reported a third-quarter comparable sales gain of 3.7 percent, noted 2.2 percentage points of that increase came from online sales, which shot up 40 percent.

Retailers also are trying to preempt and combat the phenomenon of shoppers using their smartphones to comparison shop and use stores as so-called showrooms. Best Buy Co. and Target Corp., for instance, said they will match prices with select online retailers this holiday season. Toys R Us, which unveiled a hot-toy reservation feature this holiday, requires that reservation be made in person in stores.

Chains also are trying to turn physical stores into their advantage and be proactive with smartphone-toting shoppers. Online coupon site RetailMeNot, which originally started as a site featuring coupons for online shopping, is working with retailers to “aggressively focus on in-store coupons,” said John Faith, the site’s senior vice president of mobile.

For this holiday, it’s setting up a location-based technology at more than 500 top-selling malls that will directly feed various store coupons to shoppers’ mobile devices.

A significant portion of consumers who have downloaded its mobile shopping app use it to look for in-store coupons while they are inside stores, he said.

While stores are making it more convenient to shop, products and marketing remain key for some chains in particular. Kohl’s, which generated more than half of its third-quarter sales from products only available at its stores, last week introduced a limited edition collection created by designer Narciso Rodriguez. The company, like Macy’s, said it also will increase new product shipment in December to excite shoppers.