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Analysis: Friday finds big turnouts but small sales gains

Sunday, November 29, 2009 | 7:45 p.m. CST

Despite crowds fueled by heavy discounts, shoppers spent less on average on Black Friday and weren't able to give retailers the big boost they were hoping for. Sales on the day after Thanksgiving rose just 0.5 percent to $10.66 billion, according to ShopperTrak RCT Corp., a research company that monitors sales at more than 50,000 stores. That compared with a 3 percent year-over-year Black Friday increase in 2008 and an 8.3 percent surge in 2007.

"It's a positive sign that we had an increase in sales, but the numbers certainly don't indicate that those will be sustained," said Britt Beemer, chairman of consumer behavior company America's Research Group.

Nationwide, 195 million shoppers visited stores and Web sites over the four-day weekend, up from 172 million last year, the National Retail Federation said Sunday. But average spending fell 7.9 percent, to $343.31 per person, from $372.57 a year ago. Total spending reached an estimated $41.2 billion.

Although Black Friday doesn't dictate how the holiday season will perform, it does give retailers and industry watchers a gauge of consumer perspective entering the holiday season.

What was clear this weekend was a continued preference for good deals, with shoppers rushing to snap up discounted toys, electronics and apparel while avoiding full-price items. Retailers' warnings of low inventory levels led many shoppers to hit the malls early, when traffic was especially strong.

"The appetite among consumers this year seems to trend toward lower-priced items, the items they could afford with the money in their wallets," said Ellen Davis, vice president of the National Retail Federation.

Bargain hunting became a must for Athena Martinez, 46, after her husband was laid off as a delivery man for an air conditioning company earlier this year and was out of work for five months.

Shopping in Los Angeles on Thanksgiving night, Martinez said financial worries had led her to try outlet shopping for gifts.

"We're still trying to play catch-up," said Martinez, an Anaheim, Calif., resident, who added that her family would be focusing on necessities this holiday season and was cutting its budget by at least half.

"No big-ticket items. No TVs, no iPods," she said.

Popular purchases this weekend included clothing, books, toys and gift cards, the retail federation said.

A bright spot for merchants on Black Friday came online, where sales were strong. U.S. online sales rose 11 percent to $595 million, making it the second-heaviest online spending day to date in 2009, tracking company ComScore said.

And Coremetrics, a San Mateo, Calif.-based analysis company, said the average amount that consumers spent per online order on Black Friday rose 35 percent, to $170.19, from $126.04 last year.

"There's a long-term trend where online is gaining share of total retail spending," said Andrew Lipsman, director of industry analysis for ComScore. "The fact that we're getting double-digit growth rates is a positive sign to kick off the holiday spending season. It can definitely be attributable to the kind of discounts and deals that were available."

Monday, retailers will have another chance to grab online shoppers, with nearly 100 million consumers expected to shop on so-called Cyber Monday.

Retailers look to the Monday after Thanksgiving as another chance to score additional sales when shoppers log on at work to take advantage of their employers' fast Internet connections.

Although the importance of Cyber Monday has waned as more homes have broadband, hundreds of merchants are still expected to offer promotions to spur sales. Deals include extra discounts and free shipping.

The holiday season "is not a sprint — it's a marathon," said Scott Krugman, a National Retail Federation spokesman. "We still have a long way to go."


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