Outlook: A Green Christmas

Whether it was in cyberspace or at the mall, the holiday shopping season got off to a promising start over the Thanksgiving weekend, with shoppers buying up everything from Pokemon toys to DVD players to pashmina shawls.

"So far the holiday season has shaped up for many retailers brilliantly," said Kurt Barnard, president of the consulting firm Barnard's Retail Trend Report. In many cases, this weekend was well beyond their forecasts."

Retailers are optimistic about this holiday season, their expectations lifted by high levels of consumer confidence, low unemployment rates and sharp gains on Wall Street.

They are counting on shoppers like L.T. Owen, a 61-year-old accountant living outside of Atlanta, who thinks the economy looks "rosy." And Chicago resident Thomas Avant, who makes more working at an Arby's Restaurant so he feels he can spend more.

"I'm spending more because we did well in the stock market," said Kay Abrams, who was shopping at Chicago's State Street.

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But many merchants are still going to great lengths to lure shoppers and get them buying early in the season, rather than waiting until the days right before and after Christmas, when stores typically slash prices to clear out inventories.

Online stores, in particular, are hoping for most purchases to come in the next two weeks, which would give them ample time to deliver goods as well to reorder out-of-stock merchandise.

To drive people to their stores and inspire them to spend, online and traditional retailers are using deep discounts - some offering as much as 50 percent off - and aggressive advertising, blanketing television, the Internet and newspapers with promotions.

The tactics apparently worked this weekend. TeleCheck Services Inc., a check approval service, said the amount of sales paid for by check on Friday rose by an unexpectedly strong 6.4 percent from the same day a year ago.

While Friday was undoubtedly the busiest day, retailers reported that sales continued at a steady pace through Sunday.

Crowds packed stores such as Wal-Mart, Target and Best Buy, with shoppers grabbing up everything from $5 Barbie dolls to $99 televisions. Checkout lines at some stores ran 20 people deep.

"If you want the bargains you know you have to spend a little bit more time in line," said Patty Tappen, who was shopping at the Inland Center Mall in San Bernardino, Calif. "It's worth the hassle."

Sales were also brisk online. Amazon.com reported orders this weekend were up 150 percent from a year ago. Yahoo! had its biggest day ever on Friday, as did rival Lycos, and sales remained strong through the weekend. Both portals have hundreds of merchants selling goods through their Web sites.

According to the Nielsen/NetRatings Holiday E-Commerce Index, there was an 18 percent growth in online traffic from Wednesday through the weekend. The winners included those selling toys, with an 80 percent surge in visitors to those sites, and electronics, which saw a 40 percent gain.

Demand was so overwhelming at some Internet stores, such as Toysrus.com and KBKids.com, that their Web sites were inaccessible sporadically throughout the weekend.

Not only did many shoppers use the Web to buy, but many also relied on it to help them craft their gifts lists. Many consumers were spotted carrying printouts from the Internet as they walked through the mall.

"I got all the information (online) so I can go in and - boom! I know the pricing, I know about the product," said Larry Lynn, who was shopping at the Gwinnett Place Mall outside of Atlanta.

Despite the strong start to the season, retailers remained cautious Sunday, because in recent years the Thanksgiving weekend has accounted for less than 10 percent of all sales tallied during the Christmas season.

In addition, merchants know that any stock markt volatility or unusual weather in the coming weeks could keep shoppers home.

"I am cautiously optimistic about what is ahead," said Bloomingdale's chairman Michael Gould.

By Rachel Beck
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