Stores cut prices to entice post-holiday shoppers

Two hours before the doors were set to open Friday morning, a Miami-area Wal-Mart parking lot was full of cars - and possibility.

But in a Christmas shopping season in which many Americans were unwilling to spend, even a packed lot doesn't always translate into holiday cheer for stores.

As stores offered rock-bottom prices and extended return policies, shoppers returned to the malls the day after Christmas. But many were on the hunt for big bargains on specific items or hoping to return unwanted gifts - not looking to splurge.

Brenda Peterson was looking for "flat-out bargains' after driving 35 miles to arrive at a J.C. Penney in Raleigh, N.C., at 5 a.m., a half-hour before the store opened.

But she left empty-handed. A toy that she had spotted before Christmas - a stuffed dog that rolls over and shakes its paw - was gone. And even sales of up to 60 percent off clothing and other items weren't too enticing. After all, she had seen those sales before Christmas, too.

That was a common refrain among shoppers Friday, who appeared to be searching for a deal unlike any they had seen this year.

Leona Mason of Bowie, Md., was scouring the Towson Town Center mall for a few after-Christmas gifts, including a holiday blouse for her sister.

"I'm basically looking for bargains," she said. "I'm looking for sales."

That kind of focus by shoppers could spell deep trouble for the nation's stores, which are facing the worst holiday shopping season in decades.

Holiday sales - which typically account for 30 percent to 50 percent of a retailer's annual total - have been less than jolly. Job cuts, portfolio losses and other economic woes have led many Americans to cut back on their spending. Meanwhile, strong winter storms kept some would-be shoppers at home.

According to preliminary data from SpendingPulse, which tracks purchases paid for by credit card, checks or cash, retail sales fell between 5.5 percent and 8 percent during the holiday season compared with last year. Excluding auto and gas sales, they fell 2 percent to 4 percent, according to SpendingPulse.

More people did appear to shop online, particularly during the past two weeks of the season, when storms hit. Online sales dipped just 2.3 percent, SpendingPulse said.

A fuller indicator of how retailers fared will arrive Jan. 8, when major stores report same-store sales, or sales at locations open at least a year, for December.

Many stores are likely to report a loss for the fourth quarter, said NPD senior retail analyst Marshal Cohen.

Stores were hoping that big discounts the day after Christmas could lure people out and help stem those losses. And although some malls appeared to be busy with bargain-hunters and gift-returners, analysts said traffic appeared to be lighter than in years past.

The parking lot of a Wal-Mart in Milwaukee was less than one-third full Friday morning, with many shoppers appearing to stock up on groceries and small household items.

Gigi Johnson, a special needs teacher, bought laundry detergent and some clothes for her twin 14-year-old daughters. But she said she was not planning any large purchases for the next few months and would put the money she received from Christmas in the bank.

"Maybe I'll wait until tax time and get a computer or TV," Johnson said. "But until then, I'm resisting the temptation to buy anything else."

Newlywed Anthony Guites, 32, planned to stop at three Miami-area stores to return gifts from his wife. He had three things to exchange at Wal-Mart for a fishing rod he wanted.

"She got me a fishing rod that I don't like. She got me this tool set that I already have. And she got me workout clothes that, let's just say, are way too colorful for me," he said.