By KATE PRAHLAD, Capital News Service
ANNAPOLIS (November 23, 2007) - As soon as she started taking down the Halloween decorations from her Annapolis crafts store, Natalie Silitch replaced them with silver-frosted pine cones, grinning reindeer with evergreen antlers, and angel tree-toppers.
"We decorated the store then for Christmas, put the ornaments out and tons of gifts," said Silitch, who said Christmas shoppers "really started in" to her store in the first weekend of November.
She is just one of the many retailers seeing the holiday shopping season starting early—very early.
While the traditional start to holiday shopping is Black Friday, the day after Thanksgiving, more than 40 percent of shoppers began buying gifts before Halloween this year, according to the National Retail Federation.
"The actual holiday shopping season starts much earlier, and it's been earlier and earlier each year," said Jie Zhang, an assistant marketing professor at the University of Maryland's Robert H. Smith School of Business.
But the day after Thanksgiving "still holds a significant symbolic place as the official kick-off to holiday shopping season," she said. "There's always a media buzz about how retailers did."
For retailers this year, however, the weeks before Black Friday will be just as important to the bottom line as the weeks after, even with an unusually long span between Thanksgiving and Christmas.
Retailers began their holiday promotions weeks ago to lure those early shoppers.
"Wal-Mart starts early with deep discounts," Zhang said. She said this year, the store picked 12 toys to be the hot picks for the season and began discounting those toys from 20 to 50 percent.
The drastic discounts could mean profitability problems for retailers "who are forced to compete early with insane discounts way too deep, too early," Zhang said. "But it's beneficial for consumers who welcome specials and discounts."
Retailers may need the discounts to attract shoppers, as experts predict more conservative growth in holiday spending this year.
The Maryland Retailers Association is foreseeing only a 2 percent gain in holiday sales over last year.
Linda Felesky, who was out shopping on Maryland Avenue in Annapolis recently, is one of those shoppers who is going to be more cautious this year—or at least says she will be.
"I always spend too much. I've been told that before," said Felesky, but she said she would try to cut back this year.
While profits may be anemic, Zhang said the longer shopping season and the sense of desperation among retailers could result in more shoppers even if they are not spending as freely.
"The mood won't be as optimistic, so consumers will be more promotion-sensitive," she said. "And retailers will be more competitive."
In addition to the economy, retailers face competition with the Internet. During non-holiday times, the Internet takes about 6 percent of sales, Zhang said.
"But the Internet is very good for gifts, to do shopping and shipping without the post office," she said. She predicted that 30 percent of holiday shopping is going to be over the Internet.
Gift cards are also becoming more popular as holiday gifts. The National Retail Federation reported that more than half of consumers want to receive a gift card or gift certificate as a holiday gift.
"Recipients like the convenience and the flexibility," Zhang said. "The stigma of gift cards is disappearing."
Felesky agreed, saying now that her kids are grown, she gives them more freedom to choose their gifts.
"As the kids get older, I give them money," Felesky said. "They don't want some old lady's taste."