Holiday Hysteria: It's Coming

A 42-inch plasma TV for less than a grand? As retail giants Wal-Mart and Target announce quarterly numbers, Black Friday's deals are already leaking out

by Pallavi Gogoi

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Looking for a deal this holiday shopping season? How about a 42-inch plasma HDTV for less than $1,000? You won't find that kind of boob-tube bargain at any store today. But come Black Friday, the day after Thanksgiving, that's the deal retail giant Wal-Mart (WMT) will offer to its customers—as long as supplies last.

The company isn't publicly saying exactly which television it'll be offering that day. But the flyer Wal-Mart is planning to place in newspapers is already available on the Net, at Web sites such as Bfads.net, BF-06.com, and Dealtaker.com.

Every year, retailers try to build up a frenzy around the start of the holiday shopping season. They do it with everything from early store openings and online flyers to "doorbuster" sales, with a limited number of very low-price items.

Amy Brady is one of the people keeping an eye out for bargains. The 38-year-old from Laguna Miguel, Calif., is particularly looking for sales on the iPod from Apple Computer (AAPL) and similar gear, for her 9-year-old boy and 6-year-old girl. "My children are getting older and asking for more expensive items like iPods," says Brady, an office manager at an architect firm, who will do anything to save some bucks. "I would go and stand in line at midnight if I could save a bundle—I don't have a lot of extra income."

Midnight Consumers

While Black Friday is an annual event, retailers this year are going above and beyond to pull in the crowds. Several malls are opening Friday, Nov. 24, at midnight to kick off their early-bird shopping, which usually begins around 6 a.m. Chelsea Property Group, which runs 35 outlet center malls in the U.S., plans to open 25 of its shopping centers this year at midnight. "We tested this last year at seven malls, including New York's Woodbury Common, and the parking lots filled up by 1 a.m.," says Michele Rothstein, spokeswoman for the Chelsea Property Group. "We thought one bus would come in from New York City, but seven busloads turned up. Clearly, the shoppers voted and they say they like it."

The Internet is proving to be another effective way to build up excitement. Catalogs from all the large retailers—from Best Buy (BBY) and Circuit City (CC) to Target (TGT) and Wal-Mart—are online. And some very hot items like flat-panel TVs, video games, cameras, and laptops will be available at a deep discount only to those early shoppers who wait in line, because the stores will run out of these short-supply items very quickly. "'Come and buy now or it will be gone' is the atmosphere that retailers want to create—that of scarce products at great value," says Patricia Pao, founder of Pao Principle, a retail consultant.

How retailers perform this holiday season will be particularly important to their financial health. They've been suffering through a rocky few months, with companies such as Wal-Mart, Target, and Fred's (FRED) all reporting sluggish growth in October (see BusinessWeek.com, 11/3/06, "'Tis the Season for Price Cuts"). The latest indication of retailers' performance will come Nov. 14 as Wal-Mart, Target, Saks (SKS), and Abercrombie & Fitch (ANF) report their earnings for the most recent quarter and, in many cases, give their forecast for the fourth quarter. In addition, the Commerce Dept. will report U.S. retail sales for October.