U.S. retailers slow discounts after ‘Black Friday’

* Analysts say game plan is good, especially for margins

* Saturday more about peace and convenience – shopper

By Dhanya Skariachan

NEW YORK, Nov 27 (BestGrowthStock) – U.S. retailers scaled back
discounts and shoppers were less frenzied on Saturday, a day
after the mad rush for “Black Friday” bargains kicked off the
holiday shopping season.

The strategy of easing up on discounts makes sense
considering the strong kick-off to the busiest selling season
of the year and that retailers have almost a month to sell
their goods before Christmas Day, analysts said.

“For the retailer, the holiday season is more of a marathon
than a sprint,” Moody’s analyst Scott Tuhy said. “We still have
28 shopping days to Christmas.”

“As retailers seek to keep momentum going, obviously you
can’t do yesterday (Black Friday) day after day for 28 days,”
he told Reuters.

Wall Street Strategies analyst Brian Sozzi thinks fewer
discounts on Saturday are part of a plan, with retailers likely
to ramp up promotions again in two days for the so-called
“Cyber Monday,” which is geared toward online shoppers.

For a graphic on Black Friday traffic and holiday sales:


Reuters Insider reports: [ID:nRTV166827 [ID:nRTV161989]

For other holiday retail stories [ID:nUSHOLIDAY]


Analysts and retail experts forecast this to be the best
holiday season in three years, with the economy showing some
signs of improving, though unemployment remains stubbornly

Consumer spending accounts for about 70 percent of the U.S.
economy, which makes “Black Friday” and the rest of the holiday
shopping season a closely watched proxy for the state of the
economy as a whole.

Retail stocks have rallied on investor hopes for a
better-than-expected holiday season. The Standard & Poor’s
Retail index (.RLX: ) closed at its highest level in over three
years on Wednesday but was off 0.36 percent on Friday.

Many retailers saw longer lines on “Black Friday” this
year as U.S. shoppers opened their wallets to scoop up bargains
on everything from laptops to hoodies to cute collectible toys.

“The Christmas holiday shopping season has gotten off to a
strong start for us. Across the country, consumers appear to be
more eager to shop than the last couple of years,” J.C. Penney
Co (JCP.N: ) Chief Executive Mike Ullman said on Saturday.

The comments echoed those from chiefs of top retailers such
as electronics chain Best Buy Co (BBY.N: ) and toy seller Toys R
Us [TOY.UL]. [ID:nN26123388]

At the same time, a slowing pace of discounts is good for
retailer margins.

“If sales are building up (slowly) but it’s selling at
better margins, that’s fine. That’s better than having a lot of
sales and having unusually high discounts to get those sales,”
Tuhy said.

The National Retail Federation has said up to 138 million
people could hit stores this weekend. The industry trade group
forecast a 2.3 percent increase in sales during November and
December, up from a 0.4 percent rise in 2009.

For shoppers like Chris and Kristen Hellinger, who were
waiting for a Best Buy in Jersey City, N.J., to open on
Saturday, the day after the day after Thanksgiving was a more
relaxing time to shop.

They were hoping to buy several Compaq laptops for $160
each as part of a two-day sale.

“We didn’t make it to get in” on Black Friday, said
Kristen, 27, even though they arrived more than two hours early
at 2:30 a.m. “They were already sold out of what I was looking
for, so we came back today.”

On Friday the line wrapped all the way around the building,
said Chris, 30, with people camped out in chairs and tents.

With no line on Saturday, the couple waited comfortably in
their car. “Today’s quiet so far,” Chris said.
(Additional reporting by Jon Lentz and Phil Wahba; Editing by
Vicki Allen)

U.S. retailers slow discounts after ‘Black Friday’