Holiday Sales 'Lackluster'

December 28, 2007
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GRAND RAPIDS — Consumers kept a little more jingle in their pockets for the 2007 holiday shopping season, a sampling of local retailers indicates.

“We had good traffic. We made a lot of sales, but the average sale has gone down,” said Barb Stein, owner of Great Northern Trading Co., a Rockford gift shop. “Everything sort of went downhill mid-fall. We had been having a better-than-expected year till then. It went downhill when all the auto news that was so bad came out.”

The Michigan Retailers Association projected a lackluster 2.2 percent sales increase for this year (see column, page 24), the lowest holiday growth level since its index was established in 1994.

“That’s on average. There are some who are projecting double-digit increases and some projecting declines,” MRA spokesman Tom Scott said. “When you look at all the challenges in Michigan’s economy, it’s still a good number because it’s positive. It’s certainly a slow year.”

Nationally, MasterCard Advisors’ SpendingPulse put holiday sales, between the day after Thanksgiving and Dec. 24, at 3.6 percent higher than last year. In a Dec. 26 press release, SpendingPulse revealed that while apparel sales were up just 1.4 percent, footwear sales grew by 6 percent.

E-commerce was up by 22.4 percent, SpendingPulse reported, with Dec. 13 posting the largest volume of online sales.

Michael McNamara, vice president of research and analysis for MasterCard Advisors, stated that higher gasoline prices and bad weather affected holiday sales.

As of two weekends prior to Christmas — which was marked by a snowstorm across the Lower Peninsula — the Michigan Retailers Association tabulated Michigan’s sales increase at less than 1 percent, based on debit and credit card sales, Scott said. The weekend before Christmas also saw a snowstorm that stymied traffic in West Michigan, which pushed gift-buying even later.

“We had strong sales on Christmas Eve,” said Emily Stavrou, marketing coordinator for Schuler Books & Music, which has three stores in the Grand Rapids area and two near Lansing. She said shoppers who stayed home that snowy Sunday turned out at the 11th hour. “We did attribute to that (snowstorm) some of the higher sales we achieved on Christmas Eve. It really did make a difference,” she added.

Stavrou said Schuler’s online sales have gone up this year, in particular for gift cards. “Ours have no fees and never decrease in value, so that was a huge draw for people,” she said.

The newest Schuler location, in downtown Grand Rapids, drew steady traffic, but didn’t experience the last-minute rush of shoppers seen at Schuler’s other stores, Stavrou said. “We expect that next year having been in that location for a while will help build clientele for the future.”

Overall, Stavrou said, “Our expectations were on par, considering the state of the economy in Michigan. We are on target for sales.”

Amy Ruis, whose store, Art of the Table, survived a summer construction season on Wealthy Street, said customers seemed to avoid impulse purchases.

“If I listened to the media, the word ‘lackluster’ came up, and that’s what I would peg it as,” Ruis said. “It was a success, but only to a point. I also think client giving is down, and that’s a big deal for us. We do a lot of baskets.”

In Eastown, Ron Lichtenstein, who owns Gallery 154 with his wife, Christine, was upbeat.

“This is our 31st year in business. We have great clientele and a great location that sells itself,” Lichtenstein said. “We’ve got no complaints. It’s just another wonderful holiday season.”

He said the store does half its business in October, November and December each year. He sees many customers only once a year — at the holidays, he added.

Scott said the strategies that the Michigan Retailers Association’s 5,500 members — mostly small- and medium-sized retailers — employ all year to compete with malls and big-box retailers are the same ones that keep them in business during the holidays.

“They just offer a different mix of products, a much, much higher level of personal customer service and a very unique atmosphere inside the store,” Scott said. “Those are just the things that differentiate them and make people want to shop with them.”

Special events such as the city’s “shop hops” and Rockford’s carriage rides and caroling events attract shoppers, the retailers said.

“I think it’s extremely important,” said Stein, who is a member of the Rockford Chamber of Commerce committee that plans the events. “The Rockford area is our core customer, but we need more than just the Rockford area. This year we were offering more promotions and specials deals than we normally do. Everybody was doing it this year.”     

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