Despite the huge discounts and other incentives that stores offered leading up to Christmas, U.S. holiday sales so far this year have been the weakest since 2008, when the nation was in a deep recession.
Locally, the Oxford Exchange’s parking lot Wednesday was filled nearly to capacity in front of some popular retailers. A long line of traffic flowed into and out of the exchange, where shoppers said they were there to take advantage of post-Christmas sales.
That’s hopeful news for retailers now depending on the days after Christmas to make up lost ground: The final week of December can account for about 15 percent of the month's sales, and the day after Christmas is typically one of the biggest shopping days of the year.
Stores, which don't typically talk about their plans for sales and other promotions during the season, are known for offering discounts of up to 70 percent after the holiday. This year, they're hoping to lure more bargain hunters who held off on shopping because they wanted to get the best deals of the season.
Coline Worthy came to the Oxford Exchange Wednesday to shop for bargains and to exchange gifts with her 16-year-old daughter, Fortune Worthy. Coline Worthy said she discovered great finds at Hobby Lobbhy, where she shopped for Christmas items, some at a 66 percent discount.
Her daughter wasn’t as successful in shopping for clothes. Fortune Worthy shopped at Old Navy, where some racks and shelves were bare by mid-afternoon.
That came as little surprise to the Lineville residents who say they usually shop sales immediately after Christmas. “It’ll be cheaper after Christmas, but it’s pretty picked over,” said Fortune Worthy.
Like Coline Worthy, several people said they went shopping Wednesday to take advantage of deeply discounted Christmas items. Others said they weren’t shopping for anything in particular, and at least one local woman said she came to the Oxford Exchange mainly to overcome holiday-induced cabin fever.
“It was time to get out,” said Weaver resident Carla Williams, while walking toward Target dressed in a coat and scarf.
The shopping rush after Christmas illustrates just how important holiday sales are. Consumer spending accounts for 70 percent of economic activity, and many retailers can make up to 40 percent of their annual revenue during the two-month holiday period at the end of the year.
The Alabama Retail Association won’t know until February if retail sales grew in Alabama during the November and December shopping months, said Nancy Dennis, a spokeswoman for the association.
Still, the association predicted a 4 percent growth in retail sales for this year’s holiday season over last year’s, and, Dennis said, while speaking from a cell phone in a Montgomery-area Target, that Wednesday would be one of the biggest shopping days of the year.
“It’s maybe the third-largest shopping day of the season,” Dennis said.
Across the country, holiday sales of electronics, clothing, jewelry and home goods in the two months before Christmas increased 0.7 percent compared with last year, according to the MasterCard Advisors SpendingPulse report. SpendingPulse, which tracks spending, said that's the weakest holiday performance since 2008 when sales dropped sharply, although the company did not know by how much.
The SpendingPulse data released Tuesday, which captures sales from Oct. 28 through Dec. 24 across all payment methods, is the first major snapshot of holiday retail sales. A clearer picture will emerge next week as retailers like Macy's and Target report monthly sales.
In the run-up to Christmas, analysts blamed bad weather for putting a damper on shopping. In late October, Superstorm Sandy battered the Northeast and mid-Atlantic states, which account for 24 percent of U.S. retail sales. That, coupled with the presidential election, hurt sales during the first half of November.
Shopping picked up in the second half of November, but then the threat of the country falling off a "fiscal cliff" gained strength, throwing consumers off track once again. Lawmakers have yet to reach a deal that would prevent tax increases and government spending cuts set to take effect at the beginning of 2013. If the cuts and tax hikes kick in and stay in place for months, the Congressional Budget Office says the nation could fall back into recession.
Still, The National Retail Federation, the nation's largest retail trade group, said Wednesday the trade group is sticking to its forecast for sales in the November and December period to be up 4.1 percent to $586.1 billion this year. That's more than a percentage point lower than the growth in each of the past two years, and the smallest increase since 2009 when sales were up just 0.3 percent.
Kathy Grannis, a spokeswoman for the group, noted that the trade group's definition of holiday sales not only includes clothes and electronics, but also food and building supplies.
"Stores have a big week ahead, and it's still too early to know how the holiday season fared, at this point," she said.
Anniston Star staff writer Laura Johnson contributed to this Associated Press report.
Staff writer Laura Johnson: 256-235-3544. On Twitter @LJohnson_Star.