California Apparel News

Black Friday and Cyber Monday broke records for crowds and sales, and retailers are now challenged with keeping the momentum going until Christmas Eve.

For some, the lull between Black Friday and Christmas Eve will be a slow slog. Others plan to wring as much revenue as they can from the Black Friday business. Their post–Black Friday strategies could determine how profitable their Christmas season will be.

With a business headquartered in a major Los Angeles mall, the Beverly Center, Gila Leibovitch extended her Black Friday sale of 20 percent off merchandise until #8232;Dec. 4. “People went to the majors first, then they will hit the smaller stores,” said Leibovitch, who co-owns the Premier Men and Premier Kids boutiques at Beverly Center as well as Vault Men, Vault Women and Melrose Place in Laguna Beach, Calif.

She forecast the initial sales frenzy of the 2011 holiday season will fizzle out after Sunday. She and business partner Johnny Alper will have time to bring in more merchandise and polish their sales strategy until Dec. 15, the date when holiday shopping typically picks up steam again.

Fred Levine said his M.Fredric stores would hold off on sales until the end of the season. “If you promote too much, you lose integrity in your pricing completely. Who will pay full price when you’re promoting all the time?” Levine said. Rather, his seven-store chain is banking on attracting consumers through service, unique product and occasional promotions, not the big discounts of major merchants. A new M.Fredric women’s shop debuted in Calabasas, Calif., recently.

The question of whether or not to promote is a perennial issue for retailers. This year, the promoters have the edge. More retailers were swept up by Black Friday business in 2011, and they offered more generous promotions than the previous year, said Jeffrey Van Sinderen, an analyst with B. Riley & Co. in Los Angeles. “Frankly, all of the promotional activity was what spurred such a strong start to the holiday,” Van Sinderen said.

Retail powerhouse The Gap offered 60 percent off the entire store. Another popular promotion seen in many mall retailers was the “buy one item and get another item free” sale. Plus, consumers were attracted by retailers’ earlier hours, such as opening on Thanksgiving Day.

Big promotions are a cost of doing business for some retailers, and many predicted that profits will be made on volume. Retailers also will rely on consumers buying full-price items along with the items they buy on discount, said Liz Pierce, an analyst with Roth Capital Partners in Newport Beach, Calif.“The real telltale sign for the holidays is what happens in the weeks to come,” she said.

If the entire holiday season is marked by big promotions, Christmas 2011 might be characterized by poor margins. Pierce forecast retail will achieve modest gains of 2.8 percent growth during the 2011 holiday season.

The Christmas holiday’s best business might come at the end of the season, according to a Nov. 28 research note from Christine Chen of Needham & Co.

She quoted a survey from the National Retail Federation, which found eight out of 10 consumers planned to give friends and family gift cards, which are typically redeemed a week or so after Christmas. Also, Hanukkah takes place relatively later in December, compared with the previous two years. It will start Dec. 20, which means those celebrating Hanukkah might get a late start on shopping.

Record-breaking start

While sales for the Christmas season have been forecast to be modest, results for the season’s opening weekend made for exhilarating news. And the good news continued. Cyber Monday shoppers went on their biggest spree ever. On Nov. 30, business-analytics company Com.score Inc. announced that online spending reached $1.25 billion on Cyber Monday, up 22 percent compared with Cyber Monday 2010. Com.score contended that Cyber Monday was the heaviest online spending day in history and the second day on record to surpass the billion-dollar threshold.

Crowds surprised mall managers on Black Friday. A record 226 million shoppers looked for deals and holiday gifts at boutiques and on websites during the Black Friday weekend, according to an NRF survey conducted by BIGresearch. The crowd count shot up from 212 million during the 2010 Black Friday weekend.

In Southern California, the retail-traffic reports were equally robust. At the Glendale Galleria, it was estimated that Black Friday weekend traffic increased 5 percent compared with the Black Friday weekend traffic of the previous year, said Shoshana Puccia, director of marketing for the shopping center, located in Glendale, Calif.

At South Coast Plaza in Costa Mesa, Calif., it was estimated more than 200,000 people shopped the luxury retail center during the Black Friday weekend, according to Debra Gunn Downing, executive director for marketing.

At the Citadel Outlets, near Los Angeles, 100 percent of the spaces in parking lots were filled Friday night, and shoppers were guided to offsite parking. For the rest of the weekend, the Citadel’s parking lots were 90 percent full, said Traci Markel, the outlet center’s director of marketing.

During the lull after Black Friday weekend, the Citadel plans to attract more people to the center with marketing campaigns through print outlets and social media. The campaign will highlight some of the outlet’s new stores, such as Coach and Michael Kors, both of which debuted in October, Markel said.

“The week after Christmas, shoppers will be redeeming gift cards. Hopefully, we’ll be launching Spring fashions in early January,” Markel said. “And consumer confidence is up. It is a good feeling for the holidays this year.”

On Nov. 29, the Consumer Confidence Index increased 15 percent. The index is measured by nonprofit business-information group The Conference Board.