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CE Helps Draw Bigger Black Friday Crowds

11/30/2009 09:01:06 AM Eastern

New York - Deals on consumer electronics remained a top Black Friday draw, helping
to lure a larger number of shoppers over the Thanksgiving weekend.

Long Island City

Traffic at many major
consumer electronics retailers was heavy over the weekend, the Consumer
Electronics Association (CEA) reported. Consumer sampling at several CE retail
locations by CEA and Gladstone, Ore.-based retail consultancy ChannelForce
found nearly 40 percent of consumers believed traffic this year was heavier
than last Black Friday, and nearly 80 percent believed it was at least as busy,
if not more so, than last year.

More than half of
consumers interviewed were in the store to buy a specific holiday gift and to
take advantage of a specific promotion, CEA said.

"Consumers found
attractive technology offerings this weekend, consistent with CEA's earlier
Black Friday predictions that consumers are making this holiday a digital one,"
said Shawn DuBravac, CEA's chief economist and research director. "Research
by CEA and ChannelForce confirms that TVs, digital cameras, and Blu-ray players
were the top attraction on Black Friday."

What's more, CE continued
to claim a significant share of the discretionary dollars spent on Black
Friday. According to comparison shopping site PriceGrabber.com, the top 10 most
popular products for the day after Thanksgiving were all electronics devices,
including the Wii console (No. 1), the Nuvi 265WT portable navigation device
(No. 2) and the 8GB Apple iPod Touch (No. 3).

The biggest growth
categories included cellphones, up 26 percent; laptop computers, up 17 percent;
PlayStation consoles and accessories, up 12 percent; and laundry pairs, up a
whopping 70 percent, PriceGrabber said.

Anecdotal accounts
appeared to bear out CE's drawing power. Best Buy CEO Brian Dunn told Bloomberg
News that lines outside stores were longer and Web site visits greater than
Black Friday 2008, while Toys "R" Us chairman/CEO Jerry Storch told the news
service that his stores had an average of 1,000 shoppers lined up before their
midnight openings, and sold a "significant number" of Apple iPods.

At a Best Buy store in Woodbridge, N.J.,
general manager Dinesh Ramchandani said the crowd at 4:00 a.m. on Black Friday
was larger than last year, which was a good thing as he had stockpiled the most
inventory ever for that location following double-digit comp sale gains
throughout November. The big sellers that morning appeared to be PCs, digital
cameras and private-label Dynex LCD TVs.

At a nearby Sixth Avenue
Electronics store, manager Vinny Gujral said the Black Friday turnout was
bigger and stronger than 2008. "People were holding out for too long because of
fear and uncertainty, but they're finally coming out of their shells," he said.
Big sellers that morning included 40-inch LCDs, which are "very hot," Gujral
said, and netbooks, which "are on fire."

But while the weekend crowds
were larger, they left fewer dollars on the table, surveys show.

According to a poll by
the National Retail Federation (NRF) and BIGresearch, nearly two-thirds of
Americans, or 195 million shoppers, visited stores and e-commerce sites over the
holiday weekend, up from 172 million last year.

 More than 77 percent of shoppers said they
bought CE, computers, video games, music and movies, or books over the weekend,
the survey showed, up from 75 percent last year. Apparel was the next most
popular purchase at 51 percent, followed by toys at 32 percent.

Broken out by channel,
department stores drew the largest crowds (visited by 49 percent of shoppers),
followed by discount stores (43 percent), CE specialty stores (29 percent) and
online stores (28.5 percent).

But average total
spending over the weekend dropped to $343.31 per person, from $372.57 a year
ago, the NRF said.

ShopperTrak, a
Chicago-based retail research firm, described the traditional start of the
holiday selling season as "a mixed bag," with Black Friday sales essentially
flat at $10.6 billion. By comparison, sales on Black Friday 2008 grew a
surprisingly strong 3 percent despite economic turmoil and the eventual
spending lull that continued through December, the company said.

Tepid sales can be
attributed to a number of factors, including the weak economy, price deflation,
the dilutive effect of pre-Black Friday sales events, and more rational promotions.
Indeed, industry rumors of $400 42-inch flat panels never materialized, and anticipated
$99 Blu-ray Disc player promotions were few and far between.

The most heavily
discounted doorbusters included sub-$200 laptops at Best Buy and Walmart; a $78
Magnavox Blu-ray Disc player, also at Walmart; and front-load laundry pairs for
a low as $500 at P.C. Richard & Son.

Still, Black Friday price
drops on CE items were generally milder and more limited than last year. According
to Credit Suisse retail analyst Gary Balter, the average discount on TVs was
about 13 percent at Best Buy, compared with 24 percent in 2008, and TV prices
fell 14 percent at Sears, compared with 22 percent a year ago.

But pricing on netbooks,
better LCD TVs and Apple products appeared to hold, Balter observed, and
tighter inventories together with more reasonable promotions should lead to
improved profitability for dealers.

As in past holiday
seasons, online sales appeared to outpace spending at brick-and-mortar stores.
According to Reston, Va.-based ComScore,
e-commerce sites rang in $595 million on Black Friday, an increase of 11
percent year over year. Chairman Gian Fulgoni attributed the gains to heavy
discounting, creative promotions, the use of social-networking sites like
Facebook and Twitter, and a preponderance of Web sites posting advance Black
Friday pricing.

The five most heavily trafficked
online stores on Black Friday, each with more than 4 million unique visitors,
were Amazon and its related sites, up 28 percent in visitors; Walmart.com, up
22 percent; Apple.com, ahead 39 percent; Target.com, up 2 percent; and Best Buy
and its related sites, up 24 percent.

Online sales continue
today during so-called "Cyber Monday," an invention of the NRF's online arm,
Shop.org.

 

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