CHICAGO (REUTERS) — U.S. retailers launched straight into another round of aggressive holiday advertising on Monday as analysts questioned whether Thanksgiving weekend sales were really as good as they seemed.
Wal-Mart Stores Inc. posted a record $1.52 billion in sales on the Friday after the U.S. Thanksgiving Day holiday, and groups from the National Retail Federation to Visa said weekend sales were at least as strong as expected.
The day after Thanksgiving — known as Black Friday because it used to mark the day when retailers turned a profit — is the traditional start to the holiday shopping season, which accounts for as much as 40 percent of annual revenues for big gift destinations such as toy stores and apparel chains.
Analysts were not impressed with Wal-Mart’s Black Friday performance, noting that the 6.3 percent year-over-year sales increase was well below the prior year’s 14.4 percent jump. And because Wal-Mart added about 8 percent more selling space in the last year, analysts said sales at stores open at least a year were probably up only slightly.
“Traffic was reportedly heavy, but we believe Wal-Mart missed their sales plan for the day, especially in electronics,” Shari Eberts, retail analyst with J.P. Morgan, said in a research note.
Goldman Sachs analyst George Strachan estimated that Wal-Mart’s same-store sales showed a percentage increase only in the low single digits on the Friday after Thanksgiving.
Shares of Wal-Mart closed down $1.14, or 2.1 percent, at $54.40 on the New York Stock Exchange. The Standard & Poor’s Retailing Index, which does not include Wal-Mart, rose 0.7 percent.
Wal-Mart and most other U.S. retailers will release full November sales figures on Thursday. Analysts expect retailers to post about a 3 percent to 4 percent increase in November sales at stores open at least a year — a retail gauge known as same-store sales.
Sales start again.
Retailers have learned that a strong Thanksgiving weekend means next to nothing for the rest of the holiday season. Last year, sales fizzled after a record start, and the November-December holiday season generated the smallest sales gain in more than 30 years.
The biggest shopping day of the year is usually the Saturday before Christmas, but each Saturday in December typically makes the top 10, so retailers are keeping up the pressure with steep markdowns on digital cameras, hot toys and household appliances.
Target Corp., which has slashed prices on toys, electronics and small appliances in hopes of luring customers, promised its “best price of the year” on a number of Canon cameras. The Canon Z155 camera was priced at $144.73, about $45 less than on Best Buy Co. Inc.’s website.
Best Buy, which drew some of the largest Thanksgiving weekend crowds, ran a 40-page weekend advertising circular with big-screen televisions, appliances and even electric shavers on sale.
Toys R Us Inc. was selling 35th Anniversary Elmo for $5 with any purchase of $75 or more. The toy usually sells for $29.99, the retailer said in its advertising circular.
