Discounting key to boosting holiday sales this year
Tuesday, 25 December 2007
NEW YORK, Dec 24 (Reuters): US retailers offering the widest discounts were the winners of this year's holiday shopping season, as budget-conscious consumers scrounged for deals in a challenging sales environment, according to a national survey released Sunday.
Consumers were hungry for discounts this year as they grappled with rising food and fuel costs, the US housing crisis, and worries about whether the American economy is careening towards a recession.
"I have never seen consumers more cautious, more bargain driven, more savings obsessed than I have this year," Britt Beemer, founder and chairman of American Research Group, told Reuters.
Aggressive discounting paid off for the period's stalwarts -- Costco Wholesale Corp, JC Penney Co Inc, Wal-Mart Stores Inc and Barnes & Noble Inc, consumer marketing firm America's Research Group said.
Retailers who failed to discount -- such as Macy's Inc, Circuit City Stores Inc and Borders Group Inc -- were the season's worst performers, the survey found.
"Penney's was super-aggressive. They were advertising 40 to 50, 60 per cent off all season and Macy's didn't do it," Britt said.
Barnes & Noble's discount programme -- which offers members who pay a $25 fee as much as 40 per cent off on hardcover best-selling books -- managed to entice enough shoppers to effectively drive "a dagger through the heart" of rival bookseller Borders, Beemer said.
Borders counters with Borders Bucks, which gives members a $5 coupon every time they spend $150.
American shoppers "went out and bought every deal they could," he added. "When there were no deals, there weren't many buyers."
Earlier in the season, many retailers slashed inventories and advertised holiday discounts sooner than in prior years in a bid to jump-start holiday shopping.
Consumers were hungry for discounts this year as they grappled with rising food and fuel costs, the US housing crisis, and worries about whether the American economy is careening towards a recession.
"I have never seen consumers more cautious, more bargain driven, more savings obsessed than I have this year," Britt Beemer, founder and chairman of American Research Group, told Reuters.
Aggressive discounting paid off for the period's stalwarts -- Costco Wholesale Corp, JC Penney Co Inc, Wal-Mart Stores Inc and Barnes & Noble Inc, consumer marketing firm America's Research Group said.
Retailers who failed to discount -- such as Macy's Inc, Circuit City Stores Inc and Borders Group Inc -- were the season's worst performers, the survey found.
"Penney's was super-aggressive. They were advertising 40 to 50, 60 per cent off all season and Macy's didn't do it," Britt said.
Barnes & Noble's discount programme -- which offers members who pay a $25 fee as much as 40 per cent off on hardcover best-selling books -- managed to entice enough shoppers to effectively drive "a dagger through the heart" of rival bookseller Borders, Beemer said.
Borders counters with Borders Bucks, which gives members a $5 coupon every time they spend $150.
American shoppers "went out and bought every deal they could," he added. "When there were no deals, there weren't many buyers."
Earlier in the season, many retailers slashed inventories and advertised holiday discounts sooner than in prior years in a bid to jump-start holiday shopping.