Thursday, November 20, 1997

Retailers try gimmicks to lure holiday shoppers

By Lore Postman / Knight-Ridder Newspapers

CHARLOTTE, N.C. -- Sales signs already abound. Giveaways promise trucks, trips and more. Advertisements plastered on billboards, televisions and newspapers scream the best deals and the prettiest colors in town.

Although Thanksgiving is still more than a week away, retailers are already revving up strategies they hope will lure customers during the next five weeks.

"This is the scariest time of the year for retailers," said Erik Gordon, director of the Center for Retailing Research at the University of Florida. "Last spring you guessed what would sell well; now it's on your shelves and you have six to eight weeks to get rid of it."

Retailers have been trying to out-think each other for years. But when competition increases -- as it has each year in Charlotte -- the strategies grow more apparent and more creative.

Come hear carolers and munch on holiday snacks, said Target Store, which set aside one December morning to attract elderly and disabled shoppers at its stores nationwide. Others push free gift wrapping, out-of-town delivery or valet parking.

In 12 days (the day after Thanksgiving), retailers will enter the critical four-week selling period during which fortunate merchants will bring in more than 40 percent of annual sales.

Some 93 percent of adults in the United States celebrate one holiday in December, and for 98 percent of them, it's Christmas, according to a survey conducted for American Demographics.

All signs point to a strong season. Unemployment recently hit a 24-year low, consumer confidence is up, even the stock market gyrations seem unlikely to dampen shopping expectations.

Indeed, retail analysts and economists predict sales this season of between 3 and 5 percent higher than last year. And last year was a good year.

But shopkeepers can't be certain, so they're hedging their bets with promotions and gimmicks -- including many that they're offering this holiday season for the first time.

Next week, Charlotte's Eastland Mall kicks off its "Eastland Rewards" frequent-shopper program, which gives members free gift wrapping, a shopping bag, and, for every $250 spent, a cheese ball and knife.

"This is all about what we can do to draw that customer here instead of someplace else," said Donna Ashcraft, a spokeswoman for Eastland Mall.

Kids who accompany parents get trinket grab bags. "The key is getting kids into the mall," Ashcraft said. "If kids see something they want, they're going to hound you. That's the best advertising out there."

Sharon Luggage and Gifts' "Time to Write" program rewards kids with good penmanship with a free zipper pull and a chance to win one of 500 fountain pens.

The catch is that elementary school-age children must hand deliver the entry to Sharon Luggage stores. Again, Ashcraft reasons, get the kids into the store, and they'll probably start pestering parents for a toy.

Such programs aren't new. Grocery stores, which make their profits in nickels and dimes, have been developing such strategies for years. The frequent-buyer programs that target shoppers for free 2-liter sodas also tell stores who shops them and what they want. That knowledge tells retailers how to spend marketing dollars more wisely.

It's all about loyalty, said Thomas Palombo, president of Charlotte-based Merchandising Corporation of America Inc., a company that helps manufacturers and retailers execute promotions.

Americans typically grocery shop two to three times a week, spending about $19 a visit, he said. "If you can keep a customer loyal for a number of years, he becomes much more profitable and valuable over the long haul."

The same holds true for apparel retailers.

Belk, which is giving away a Geo Tracker this year to attract customers to its Charlotte-area stores, started its own loyalty program last summer to reward customers who charge $800 or more a year on their Belk cards. The benefits for customers: free alterations, free shipping and delivery on purchases of $50 and up and special discounts. Belk benefit: Customers buy items there they might have bought elsewhere.

Carolina Mall in Concord and Eastridge Mall in Gastonia this fall offered a mall credit card that rebates 2 percent of purchases made at the mall and 1 percent of charges made outside it. The catch: Rebates must be spent at mall shops and restaurants. The reason: Build mall loyalty and increase traffic.

The card holders also get reserved parking, free stroller rental, discounts and free gift wrapping.

Driving the credit card and frequent-shopper program trend are industry conclusions that it makes more sense to cater to a narrow base of loyal customers than to launch mass marketing campaigns to attract new shoppers.

"They're fighting over the same existing customers," said University of Florida's Gordon. "Stores will do whatever they can to keep their shoppers.

"However, that said, there is no strategy that can make every retailer do well in our overstocked markets."

"They're fighting over the same existing customers. Stores will do whatever they can to keep their shoppers. However, that said, there is no strategy that can make every retailer do well in our overstocked markets."