Bloomberg Businessweek - USA (2020-10-12)

◼ BUSINESS Bloomberg Businessweek October 12, 2020

17

STEPHANIE

KEITH/REUTERS

Manystoresthathavereopenedstillhavelimited

capacitybecauseofdistancingrestrictionsandare

likelytobringinonlya fractionoftheirtypicalholi-

dayseasonhaul.TakeMacy’sInc.,whoseManhattan

flagshipis oneofthebusieststoresintheU.S.Chief

ExecutiveOfficerJeffGennettesayscrowdsare

boundtobeanissueonThanksgivingweekendand

thefinaldaysbeforeChristmas.Thecompanywill

continuefollowingtheguidelinesit createdwhenit

reopeneditsfamousHeraldSquareoutpostinJune.

Someentranceswillremainshut,shopperswillbe

requiredtowearfacemasks,andhandsanitizerand

sneezebarrierswillbeeverywhere.Securityguards

andsignswillremindthemtokeepa safedistance,

puttinga damperonthetypicalholidayfrenzy.

LululemonAthleticaInc.,anathleisuregiant

that’sbenefitedfromthepandemic’scozy-at-home

trend,willsetupabout 20 smallerhubswithinmalls

whereit alreadyoperatesa storetohelpreduce

longlines.Theleggingscompanywillalsoopen

50 seasonalpop-upshopsaroundthecountryasit

hasinyearspast.“We’reconfidentinthedemand

behindourproduct,”saysCEOCalvinMcDonald.

AtNeimanMarcusGroup,thebigchangewillbe

howshoppersmaneuverinsidethestore:Clientele

whodon’tfeelcomfortablewanderingtheaislescan

bookprivateroomswhereassociateswillbringthem

LouboutinpumpsandFerragamoties.“Wedon’t

knowwhat’sgoingtohappen,butwewanttohave

options,”saysCEOGeoffroyvanRaemdonck.

Sofar,customersdon’thavespecificsabout

whattoexpectwhentheyenterBlackFridaymain-

staysincludingBestBuy,Target,andWalmart.

Butthestoresaresayingthey’llcontinuetostick

totheguidelinesthey’vebeenusing—masksare

mandatory,stand 6 feetapart,don’ttouchthings

you’renotgoingtobuy—whichcoulddetersomeof

thefrenzytheshoppingholidayis knownfor.

Onebigchangeis thatmerchantsaretryingto

encourageearlierspending.RetailveteranDeborah

Weinswig,CEOofCoresightResearchInc.,has

persuadedtwodozenlargeretailers—including

Guess?andJoS.A Bank—toinaugurate“10.10,”a

shoppingholidaythatwillofferdiscountsforseveral

daysaroundOct.10,asa waytogetshoppersto

purchasegiftsearlierandmakeshippingeasier.

Amazon.comInc.’sPrimeDaywillbeginon

Oct.13.HomeDepotInc.isofferingBlackFriday-

esquesalesrightafterHalloween.AndtheNational

RetailFederation,whichrepresentsAmerica’s

largest stores, is running ads that tell shoppers

“there’s no reason to wait until Thanksgiving.”

It might work. Almost half of U.S. consumers said

they planned on beginning their holiday shopping

before November, up 7% from last year, according to

a survey from AlixPartners. A kick-start might help

retailers with another challenge: the piles of unsold

goods that have stacked up since last winter.

Once the holiday season is in full swing, some

shelves may be left bare on purpose. Levi Strauss &

Co. CEO Chip Bergh says he’s willing to forgo a sale

rather than get stuck holding excess merchandise

that may require extensive markdowns to get rid of.

Online deal seekers had already been chipping

away at Black Friday sales in recent years, and now

THEBOTTOMLINE Departmentstoresandapparelmerchants

typically do a quarter of their business in November and December.

But this year, Covid has brought uncertainty to their holiday haul.

consumershavegrownmorecomfortablewith

shoppingontheweb.Morethan90%saidtheywill

chooseonlineBlackFridaydiscountsoverin-store

doorbusters,accordingtoa recentsurveybydigital

couponproviderRetailMeNotInc.Thatcouldstifle

theimpulsepurchasesstorestypicallygetwhen

holiday shoppers walk past, say, a display of $35 air

fryers on the way to the checkout.

Still, it’s uncertain whether consumers are ready

to shop until they drop so soon after living through

a pandemic. So expectations remain modest: Total

holiday spending on average is expected to be up

1.5%,accordingtoconsultantDeloitteLP,farless

thanthe4.1%growthseenin2019.Butthatspending

willbeconcentratedamongthewealthyandmiddle

class who still have income flowing. Millions of

Americans, including Davis, who was out of work for

three months, haven’t been so fortunate. “We could

gettotheholidays,andtherecouldbea spike,”Davis

saysaboutCovid.“Icouldclearlybebackoutof

workagain,justsittingathome.”It’sthatprospect

thathas retailers worried. �Jordyn  Holman,

Kim Bhasin, and Katherine Doherty

*FOR FISCAL YEARS ENDED IN JANUARY. DATA: COMPILED BY BLOOMBERG

Where the Holidays Happen

Fourth-quartersalesasa share of annual sales*

● 2010 ● 2015 ● 2019

Best Buy

Kohl’s

Macy’s

GameStop

Williams Sonoma

American Eagle Outfitters

Target

Nordstrom

TJX Cos.

Gap

Walmart

25% 30 35 40