by Doug Desjardins
In 2008, the sudden economic decline couldn't have happened at a worse time for retailers, who had already placed holiday orders for a season they expected to be a little slow but ordinary. The result was a fire-sale marathon that had retailers slashing prices to sell excess inventory long after Christmas had passed.
That's not the case this year, but retailers are still working to maintain momentum from a stronger-than-expected holiday season with after-Christmas sales that will continue into the New Year. And most of those sales are targeting people who received one of the most popular gift items of 2009: a gift card.
According to a Consumer Reports survey, gift cards were the fourth most popular gift this year with 46 percent of consumers intending to buy at least one card, bettered only by clothing (56 percent), electronics (55 percent) and toys (55 percent). Teri Llach, chief marketing officer for top gift card provider Blackhawk Network, said the cards are practical because they serve a number of purposes. "Consumers can choose a card for specific retailers or pre-paid gift cards issued by banks," said Llach.
And with all those gift cards waiting to be spent, retailers are luring consumers into stores with bargains that - while not as spectacular as last year - are still impressive. Toys 'R' Us is promoting a number of buy-one-get-one-half-off sales, and Wal-Mart is taking a similar approach by reducing prices by 50 percent on select toys and home décor items. Sears has cut prices on more than 300 items, including 10-percent markdowns on small appliances, and Target is providing a 15-percent discount on all purchases over $125.
Department stores, which typically get a big post-holiday bump from gift cards, are going even further to drive customer traffic. JC Penney is advertising its "biggest after-Christmas sale ever" with prices marked down up to 70 percent while competitor Nordstrom's is offering up to 40 percent off on products like apparel. And Macy's is offering deep discounts on men's furnishings, denim and women's sweaters.
Specialty retailers are also getting into the act. Best Buy has cut prices on most digital cameras by 30 percent and reduced prices by 15 percent on select home appliances. Kohl's has reduced prices on men's clothing by up to 50 percent, and is still offering free shipping for purchase of $75 or more online.
The category that saw the biggest increase in sales during the holidays was consumer electronics. ComScore chairman Gian Fulgoni said electronics sales increased "slightly over 20 percent" during the holidays and that "jewelry and watches also turned in a strong performance, but followed a very weak 2008 season."
Did you receive a gift card that you're ready to spend? You don't have to go to the store to use that card. Use it online and combine it with a free shipping deal for even better savings!