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Tuesday, October 2, 2012

Christmas Already?

Here’s the answer to the question, “Why have we seen stores like Wal-Mart setting up Christmas merchandise displays in September?”

The longer the shopping season, the more likely consumers are to buy more and more holiday items.
Let’s look at the details that motivate retailers to start the season early

1.      Competition
If you get a customer to buy from your store first, they are no longer a potential customer for a competitor selling the same or similar item.

2.     Layaway
Christmas layaway (buy early and pay off your holiday purchases over time; sometimes fees to use the program are involved) was basically a dead concept in big-box retailing until it was brought back last year in response to the weak economy and financially strapped shoppers. Best Buy, Kmart, Sears and Toys ’R Us resurrected to the program and Walmart jumped in last October for the first time since 2006. This year Walmart moved their layaway plan to 9/16 (from 10/17 last year) and is expanding the line of items available for layaway from electronics and toys to include small home appliances, select sporting goods and jewelry.

3.     The Presidential Election
Typically the holiday shopping ads begin to flood the airwaves in late October/early November. With the November 6th election, retailers are worried that campaign ads will steal the retail thunder.

4.     The Uncertainty of the Job Market
Christmas sales historically represent about 20 percent of annual retail activity and the retailers want to encourage purchasing as soon as possible before economic negativity has an unfavorable impact on holiday sales.

5.     Crafters
People who make their own holiday decorations and who make presents have to start now to have time to complete their project. Obviously this is critical to craft stores like Michaels and AC Moore, but big box stores like Walmart have departments that cater to this customer as well.

6.     Supply
From Cabbage Patch Kids (1983) to Tickle Me Elmo (1996) to The Nintendo Wii (2006), every year there are a few items that cause consumer mayhem when demand outstrips supply and this history can be used to motivate early shopping. Some of the toys predicted to be the biggies this year include One Direction collector dolls, Wii U (Nintendo’ new two-screen gaming console), Doc McStuffins Time for Your Check Up doll and the LeapPad2 Explorer.
NOTE: If you think it’s too early for Christmas, Hanukkah, Eid al-Fitr, Yuletide, Kwanzaa, Winter Solstice, and other celebrations, you have time ... typically there are four weekends between Black Friday and Christmas, but this year there are five.

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