November 20, 2009 in City

Stores strategize in light of last year’s difficult holiday season

By The Spokesman-Review
 
Colin Mulvany photo

Cues sales associate Rachel Coski arranges clothing at the boutique dress shop Wednesday in downtown Spokane. Cues, like other area retailers, has adjusted its inventory in advance of the holiday shopping season as consumers remain cautious when it comes to spending.
(Full-size photo)

Retailers across the region have just one wish: Whatever else happens, please spare us a winter like last year.

Consumers are still in a cautious state of mind, but store owners and managers say they’re going to work hard to get them to spend money over the next five weeks.

To make that happen, many retailers will use a variety of strategies, including coupons, deep discounts on popular items, free shipping and in-store promotions.

“This year couldn’t possibly be worse than last year,” said Mary Jo King, general manager of downtown Spokane’s Auntie’s Bookstore. The store was among those that felt the double impact last year of a down economy and a crippling winter storm the week before Christmas.

The economy is certainly not back to health, with unemployment high and few employers planning to add jobs until mid-2010.

Shoppers, like Spokane resident Mary Houglum, say they will spend far less this holiday. “Normally I buy my (three) kids five or six presents each,” Houglum said. “This year I’ll buy one each.”

Retailers count on the final four weeks of the year for a large share of annual sales. Those weeks are the year’s busiest at Issaquah-based Costco Wholesale, said Richard Galanti, the company’s chief financial officer.

A milder winter should result in a 2 percent increase in retail sales, Washington state economists say. Nationwide, however, the economy continues to drag down sales, with retail analysts saying sales in the fourth quarter will be 1 percent to 3 percent lower than in 2008.

Area retailers have read consumers’ mood. Trish Thoen and Meghan Brown, co-owners of downtown Spokane clothing retailer Cues, said they’ve adjusted inventory so they have more denim dresses and denim tops priced in the midrange.

“Last year we had holiday party dresses in the $400 range,” Brown said. “This year we have more dresses priced in the $200 to $250 range.”

Kathy Grannis, a spokeswoman for the National Retail Federation, based in Washington, D.C., said holiday shoppers are being presented the widest and deepest set of discounts and specials in recent memory. “Clothing stores, like Old Navy, are already offering half-off prices on outerwear and other items before Christmas,” she said. “Normally those half-off deals won’t happen until the day after Christmas.”

With the shopping season just starting, here’s how some retailers are courting customers.

Early-bird retailers. Wal-Mart is starting a weeklong blitz of special sales on Saturday rather than waiting for the day after Thanksgiving. The company said its customer surveys found most shoppers want to finish their holiday buying by the end of Thanksgiving week.

In addition, most Wal-Marts – not including the one in Post Falls – will be open 24 hours on Thanksgiving. Radio Shack stores, which previously closed on Thanksgiving, will be open from 10 a.m. to 6 p.m. A company spokesman said the electronics retailer’s first-ever Thanksgiving hours are part of a test only in stores in the West.

Selective inventories. Many retail stores across the region have refocused their inventories, anticipating cautious consumers.

“Normally for the fourth quarter we would have more expensive items, because that would be the one time of year you could sell them,” said Susan Peterson, owner of Whiz Kids, a downtown Spokane toy store.

But looking ahead to the holiday season, Peterson ordered items with a wider range of prices.

“We made sure we had more items in the less- than-$20 category, such as science kits and crafts kits,” she said.

In-store promotions and events. Three area malls – Silver Lake, NorthTown and Spokane Valley – are sponsoring promotions and incentives.

For instance, shoppers who spend $100 or more earn a $10 gift card. Those spending $75 or more can get a $15 discount for area salons.

Daryl Rheingans, general manager for the Silver Lake and Spokane Valley malls, said this year, there’s an added emphasis on coupons and deals. “Retailers have had to adjust, because consumers this year are really focused on value,” he said.

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