Expect changes in holiday shopping

Retailers and shoppers both plan for a cash-strapped season.

Published online on Monday, Nov. 24, 2008

Cash-strapped shoppers will find a different kind of Christmas out there this year: bigger sales, easier returns and plenty of more-personal gifts.

Retailers are scrambling to squeeze as much cash as they can from consumers who are spending less and thinking more about what they buy.

The National Retail Federation predicts the slowest sales growth in six years. Another organization, America's Research Group, is predicting a drop in sales -- the first in 23 years.

Erin Hershkowitz, spokeswoman for the International Council of Shopping Centers, said price is the main way retailers will try to hook people.

"People are just looking for value right now," she said. "Retailers as a whole are definitely having promotions, having sales, offering all types of promotional discounts in order to get people to shop."

Already, stores have stuffed circulars with sales tempting shoppers to beat the rush on Black Friday. The day after Thanksgiving is traditionally seen as the unofficial start of the holiday season.

Even after the steep Black Friday discounts, shoppers can expect big sales throughout the season, retail federation spokeswoman Ellen Davis said.

Retailers are likely to offer rotating sales -- one week in electronics, the next in toys -- instead of continually cutting the price on the same items, she said.

Hershkowitz said wholesale and discount stores -- everything from Costco to TJ Maxx -- will continue to be busy this year as shoppers look for value.

Noemi Garcia of Clovis will be one of those looking for deals. Last year, the waitress and full-time college student bought loads of toys for her young niece and nephew. But she said this year there is less money in her pocket as business and tips are slower where she works, the Sushi 'n' Pop restaurant in Fresno.

"This year, it's going to be smaller gifts," she said.

Returns stage a comeback

While shoppers like Garcia may lament their declining buying power, retailers' consumer-wooing strategies could make gift-buying easier.

A recent retail federation survey of 82 large retailers found holiday return policies are looser than in years past.

"Retailers are trying to provide good customer service in a down economy," Davis said. "This year, a retailer's return policy might make the difference in shopping at one store over a competitor."

The industry got a little help, she said. Years of tightening security have paid off. Fraudulent returns are expected to drop to 7.5% of holiday returns from 8.9% last year.

The change has allowed retailers to be more confident in allowing consumers to go to the return counter, she said.

More modest tastes

Shoppers also are changing the type of gifts they are buying this year, and retailers are responding.

More practical, personalized and homemade gifts will be popular this year, Davis said.

"We might see children getting a winter coat under the tree that maybe they would have gotten on an ordinary day last year," said Pam Goodfellow, a senior analyst at BIGresearch, which conducts surveys for the retail federation.

Consumers also will be trading down -- buying a cotton sweater instead of an expensive cashmere sweater that needs to be dry cleaned, for example, she said.

Getting personal

Shoppers can expect to see retailers promoting more personal items, like Horn Photo is doing with photobooks.

The store, in the Villaggio shopping center in north Fresno, is offering the books for the first time, said Stan Grosz, who owns the store with his wife, Shelly.