Holiday observations from CEOs, analysts point to stronger sales

NEW YORK – The holiday shopping season in the U.S. is in full swing after most retailers flung open their doors yesterday, offering bargains on everything from televisions to coffee brewers. Here’s what executives and analysts are saying so far:

Macy’s Inc. CEO Terry Lundgren, who opened the doors at the department-store chain two hours earlier than last year, said activewear and outerwear have been big sellers so far for men, women and children.

“This is an outerwear season for the cold-weather climate stores,” Lundgren said in an interview with Bloomberg Television today. “There was a little snow coming down and it motivated people to buy more coats.”

Lundgren, who visited the Macy’s flagship store in New York last night, said there was a diverse and international crowd of shoppers that exceeded last year’s number of 15,000.

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Target Corp. showed that consumers weren’t deterred by last year’s breach in which payment-card data was stolen. CEO Brian Cornell said he was “encouraged by early results” after Target.com had record online sales on Thanksgiving, which was up 40 percent, helped by free shipping. Meanwhile, Target stores – which also opened two hours earlier than last year – attracted large numbers of shoppers, Cornell said in an interview.

“I personally saw very good foot traffic in our stores,” said Cornell, who cited sales of 1,800 televisions per minute at the retailer’s stores nationwide. “It was encouraging to see families in our stores, certainly looking for some of the doorbuster items.”

Brian Yarbrough, a retail analyst at Edward Jones & Co., said improved economic trends and lower gas prices are helping Americans this year.

“All the economic data is better than it was this time last year,” Yarbrough said. “The consumer seems to be in a better mood or consumer sentiment is better, and the consumer should have more cash.”

Craig Johnson, president of Customer Growth Partners, a retail consulting firm, said he’s seen robust sales of consumer electronics but weaker demand for clothing. Johnson, whose team visits the 30 largest U.S. retailers on Black Friday, said many Americans still don’t have much extra cash to spend.

“The top 10 percent is doing fine, but everybody else is struggling,” Johnson said. “A lot of discretionary spending has gone to monthly, recurring bills – cable, cellphone, data plan, Netflix etc.”

Jesse Tron, a spokesman for the International Council of Shopping Centers, said shopper traffic was strong yesterday and today, with many consumers hunting for deals.

“We’re seeing a lot of shoppers out there,” Tron said in an interview. “We’ll see how that translates into sales, but while they do browse and may make incremental sales, they’re not walking out empty-handed. Conversion rates are really strong, and if that carries over that’s good for sales.”

Matt Shay, CEO of the National Retail Federation, echoed the sentiment that consumers were turning out in force this year. The NRF’s research shows that most shoppers will head to discounters, with clothing high on their lists, Shay said.

“The numbers look positive,” Shay said in an interview. “The stories we hear from the CEOs are all trending in the right direction.”

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