Wal-Mart sees holiday spirit in opening prices
November 10, 2003-- Home Textiles Today,
Wal-Mart believes opening price points will be the pre-eminent sales driver for the fourth quarter holiday season. And, sales gains will come largely because of easier comparisons against last year.
That's "what we see in the basket now," said Jay Fitzsimmons, senior vp, finance and treasurer. "We're looking at opening price points to take a bigger percentage of total sales."
While retailers commonly compare selling days to forecast the critical selling period, Fitzsimmons argued that the formula is faulty. He told attendees at Lehman Brothers' Retail Field Trip that consumers will not buy bigger gifts because the season is longer. Seasonal categories provide better sense, but are not worth focusing on, he said.
However, he felt there is a link between Halloween and Christmas, and some of the whimsical trends at Halloween will do well into the holiday season. Early reads on Christmas are that snowmen themes and coordinated looks for parties will be important. Already, Wal-Mart's initial read on toy sales is much stronger than anticipated in this economy.
Wal-Mart recently launched a heavy television ad campaign for toys featuring a gingerbread character. The season will be more competitive with retailers "going after share," Fitzsimmons predicted.
He added, "This is no longer a consumer confidence slowdown, this is driven by real economic issues...The consumer is running out of money."
He added that Target has become more competitive.
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