Business

Fishing for consumers

Depressed about the economy? Reluctant to buy, well, anything? Retailers are hoping a focus on value – and the warm glow of Christmas togetherness – can help change your mind heading into their biggest, most important time of the year.

Unlike in past holiday seasons, merchants aren't counting on a frenzy of acquisitiveness driven by hot new items. In a year where frugality has become popular by necessity, striking that tone won't fly.

Instead, expect to hear about low prices and see plenty of attempts to tie Christmas to family bonding and neighborliness – less plasma-screen TV, more Norman Rockwell.

“(Retailers) might have some services to take the worry out,” said Charles Bodkin, an associate professor of marketing at UNC Charlotte. “People want to feel safe and secure, and if you can do that with your atmosphere and your environment, all the better.”

Stores have long relied on holiday sales to boost their bottom lines: November and December represent 20 to 40 percent of annual sales for more traditional retailers, though that percentage has been declining slightly.

This year, the stakes are arguably higher. A range of retailers have already declared bankruptcy in the past few months, and a dismal Christmas could bring more casualties. Experts are predicting the slowest holiday sales growth in five to 17 years, depending on the source.

Even in a down economy, no one expects shoppers to walk away from Christmas. But at a time when consumer confidence has fallen to historic lows, making people feel good about spending is going to be key, analysts say.

“Anything that could be done to make them psychologically comfortable is going to be very beneficial,” said Melia Lyerly, COO of Charlotte advertising and marketing firm The Lyerly Agency.

Retailers that compete on price, such as Wal-Mart, already have an advantage in the current environment. Other discount and midrange stores are also emphasizing value, sometimes along with a charitable message and products – the message being that holiday shopping can help others, too.

Cheap chic discounter Target has been deliberately focusing on the “pay less” part of its “Expect More. Pay Less” message this year, placing a greater emphasis on low prices in print advertisements and in stores. For the first time, it's showing specific prices in its television ads, spokeswoman Jana O'Leary said.

Yet the chain is also making an emotional appeal, selling affordable items for which part of the proceeds will be donated to St. Jude Children's Research Hospital and the Salvation Army. A plush elephant puppet gift card holder, for instance, will sell for $2.99, with $1.75 going to St. Jude.

A holiday pitch from Kohl's is designed to showcase the midrange department store as “the one-stop destination for shoppers looking to get the most for their money during a challenging economic environment,” with visual cues pointing out “gifts that fit your budget beautifully,” the company said in a news release.

Stores not as associated with bargain prices, including traditional department stores, are working to draw customers in other ways. Macy's, for instance, is launching a nostalgic holiday campaign built around the theme “Believe,” based on the famous “Yes, Virginia, there really is a Santa Claus” story. The chain is aiming to convey a message of goodwill and generosity, and is collecting children's letters to Santa, giving $1 to the Make-A-Wish Foundation for each received, up to $1 million.

Charlotte-based department store chain Belk isn't planning a splashy theme, but is aiming to draw customers with fashion and value, spokesman Steve Pernotto said. Customers, he said, are likely celebrate the holiday differently, with a focus on more utilitarian items. “There is a lot of trepidation in the eyes of the consumer, and we understand that,” he said.

Creative approaches

Smaller retailers that don't launch giant ad campaigns even in the best of times are trying more creative approaches to bring in business, too.

Jeweler David's Ltd., at Cotswold Village Shops in Charlotte, has added some better-priced lines and exclusive collections, said David Rousso, who owns the 31-year-old store with his wife, Sandie. They're also mailing existing customers a gift card they can use toward any purchase, with a referral card to give to a friend or relative.

“We think that people are going to want to have a more special holiday season this year after all the doom and gloom that has been spread about in the papers,” he said. “What better way than a nice piece of jewelry? It doesn't have to be the highest priced piece.”

Bedford Falls Toy Shop at Park Road Shopping Center plans on emphasizing value more, pointing out that its games, toys and books offer lasting, imaginative appeal, owner Jean Odom said.

The store opted not to do a holiday catalog this year, a move Odom estimates saved $25,000. It's cut back on print and direct mail advertising. Instead, manager Ann Sessler said, it's relying more on word of mouth, passing out 20-percent-off coupons in the store and running sales that rotate through departments. Business, which has been down this year, has increased since such promotions began, Sessler said.

Twenty percent off “can make a whale of a difference,” she noted, pointing to a $200 dollhouse.

Like a number of other retailers, the store has also brought back layaway – in their case, for the first time in about a decade, Sessler said.

Business at Ski Country Sports, also in Park Road Shopping Center, depends largely on weather. If it's cold, owner Jeff Garrison said, more people visit. Still, the economic climate is likely to have some impact, too.

As a result, Garrison said he's planning to put more items on sale, let sales run longer and be more active about letting people know about the promotions. Because advertising can be expensive, he's trying to reach out to more customers through e-mail.

“The thing that's going to bring folks into the store is value, it really is,” he said. “There's going to be a lot of competition out there… I for one am going to be a little more frugal with my money this Christmas.”

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