The gaudy holiday sales forecast by some economists never materialized, but Los Angeles-based retailers reported generally upbeat results and forward momentum heading into 2007.
Early in the season, credit card company Visa USA predicted sales would rise 7.5 percent. That appeared conservative compared to 2005’s uptick of 8.3 percent. But even with a last-minute sales surge, Visa’s final number came in at 6.5 percent.
Likewise, MasterCard’s SpendingPulse service estimated holiday spending in 2005 increased 8.7 percent, significantly better than the 6.6 percent that resulted.
George Whalin, president of Retail Management Consultants in San Marcos, questions the accuracy of those numbers but said that “no doubt, when all the numbers are in, we’ll have a decent Christmas not a spectacular one. We’ve seen years of 7, 8 or 9 percent increases. That won’t happen this year, but we’ll see a solid 5 percent, maybe as much as 6 percent increase when all is said and done.”
In fact, the National Retail Federation predicted a 5 percent increase for the year. Most industries would welcome a gain of that magnitude. Ditto for local retail executives.
“We can’t divulge numbers, but we’ve seen the result of the season and we’re not unhappy with it,” said Craig Levra, chief executive of Sport Chalet Inc. in La Ca & #324;ada-Flintridge. “It was an interesting year because of the increased emphasis on buying an experience. We had increased sales for our introductory scuba lessons and alpine lessons, including kayaking, rock climbing and backpacking. We attribute that to people buying an experience as a gift.”
“From what I’ve seen and heard, it seems to have been a good season,” added Emilio Fields, director of marketing and public relations at Los Angeles-based True Religion Apparel Inc. He noted that on so-called Black Friday (the day after Thanksgiving) the company opened a store on Robertson Boulevard in West Los Angeles, and the location garnered plenty of holiday traffic. In terms of style, the company’s Joey jeans, retailing at $128, continue to be the top seller. True Religion, like Sport Chalet, trades publicly and thus can’t reveal any sales numbers until the next quarterly filing.
“The luxury end of the market has done very well,” Whalin confirmed. “Apparel will do all right, and in terms of the number of transaction, it’s probably the biggest sector of holiday gift shopping. But it will be spotty overall, depending on the store.”
Movie merchandise
Disney Consumer Goods, based in Burbank, reported double-digit growth compared to 2005 for its Disney Mix Max media player. Also, merchandise based on its two summer movie blockbusters “Cars” and “Pirates of the Caribbean: Dead Man’s Chest” proved popular. The “Pirates” DVD, released Dec. 5, sold 10.5 million copies in the first week, setting the stage for sales of bedding, action figures and video games based on the franchise through Christmas.
Disney also teamed with another L.A. company this season. Mattel Inc. in El Segundo has sold more than 27 million die-cast toys based on characters from “Cars,” while Mattel’s “High School Musical” DVD board game, based on the Disney Channel movie, made the “Season’s Surprise Hits” list at Toys R Us.
Whalin believes the real holiday shopping season now extends until mid-January when accounting for returns, gift cards, rebates and similar sales tactics. Those complications come in addition to the heavy price shifting that occurred almost daily at major store chains.
“The holiday season now lives and dies on discounts,” Whalin said. “It started with Black Friday and we saw no let-up throughout the season. It has become an aggressive, price-driven market.”
But that trend didn’t hold for one L.A.-based specialty retailer. Levra at Sport Chalet said the chain dramatically upped the price point for large game tables, but sales still went up. He also said that Uggs, the luxury boots, sold well, noting that “a lot of Nordstrom stores sold out of them early, so they were directing customers to us.”
In electronics, Disney reported sales of its MP3 player doubled this holiday season over 2005. At Sport Chalet, gear that was “iPod enabled,” such as jackets with a specially designed pocket, sold well.
