Departments KO Discounter's Sales
Extensive Promotions Help Month-long Winning Streak Continue
By Staff -- Home Textiles Today, 12/6/2004 12:00:00 AM
New York — —
New York — In an abrupt and stunning shift in consumer buying patterns during the crucial post-Thanksgiving shopping spree, shoppers flocked to full-price outlets and shunned the low-price, and often lower-quality, discounters during the fourth week of November, the Johnson Redbook Index reported.
Helped by extensive promotions, department store same-store sales shot up 3.9 percent during the week, extending a month-long winning streak. But sales at the nation's mass merchants skidded down 1.2 percent during the week.
Helped by the week's strong performance, department stores recorded a 3.6 percent increase for all of November, easily beating a target of 3.3 percent sales growth. But hampered by their poor performance during the Black Friday season, including the single-busiest shopping day of the year, discounters fell far short of their target, putting up a four-week gain of 2.5 percent, substantially beneath a target of 3.7 percent sales growth.
The weakness at discounters was reflected in the overall Johnson Redbook Index, which edged up just 0.9 percent during the final week of November, far off the 3.5 percent increase recorded the week before. And because of the big shortfall at the nation's mass merchants, overall same-store sales for the entire month came up short, rising 2.9 percent, compared with a target of 3.5 percent growth.
“The week saw the largest performance shortfall so far this month, showing shifts in leadership as performance at department stores improved while key discount stores encountered difficult selling conditions,” said Redbook Analyst Catlin Levis. “Given the large weighting of discount stores in our model, it was their underperformance that was primarily responsible for the week's poor overall showing.”
Levis said, “Most department stores were quite pleased with their post-Thanksgiving sales, but did not indicate that they had greatly exceeded expectations. The day immediately following the holiday, so-called 'Black Friday,' was the stronger of the two days. Extensive promotional activity, coupon and free gift-card giveaways helped to lure shoppers. Business slowed on Saturday, but retailers remained relatively hopeful for the season.”
In sharp contrast to department stores, “some big discounters didn't discount as heavily, leading to disappointing, below-plan sales in the final week,” she said.
Johnson Redbook Retail Sales Index
Fourth week of November
|*Including chain stores and traditional department stores.
Source: Johnson Redbook Index
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