Reading the Marketplace
December 13, 2004,
This is turning out to be a wild and wooly holiday season in home textiles, as well as all of retailing.
A number of major national players are reporting some significant increases in home textiles business; others are scratching their heads wondering what is happening to them. But after talking with some it's clear there is no discernible pattern of what consumers want and are buying.
Behind all of this eyebrow raising and questioning of the temperature of the marketplace, there are two things that most seasoned veterans in the Christmas wars — as well as some of the newcomers — haven't factored in.
One is the unbelievable surge in gift cards for the holiday season. If you don't have a clue what to get Aunt Sally, or your next door neighbor, a gift card has become a socially acceptable out.
For retailers, there is a kicker to this phenomenon. And that is that the sale of the gift card is not recorded as a sale until it is redeemed — and in most cases that will be well after Santa comes down the chimney for his milk and cookies.
The other, and related element, means that retailers either bulk up new full price, and hopefully fashion-driven merchandise to lure more redemptions of card values, or they go the down and dirty sale route and hope to sell yet another commodity comforter, towel or sheet.
And with this pot of gold in a consumer's hand, will she go for another comforter set or a luxe piece of apparel, off-price or new fashion or otherwise?
And then there is the Internet piece of the holiday equation. More and more retailers are specing out their Internet business results, perhaps as a signal to Wall Street that they are au courant with consumer shopping trends. Have you looked at home textiles offerings on the Web lately? If not, you should — and then shudder.
The aesthetics for most will quickly show what the problem is. Solving it is another story.