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The race for holiday bargains is on
Shoppers flock stores seeking discounts on Black Friday but will it last? A scuffle at a Wal-Mart.
November 25, 2005: 1:49 PM EST
By Parija Bhatnagar, CNNMoney.com staff writer
Crowds gathered early at the RadioShack in Farmington, Conn.'s Westfarms Mall.
Crowds gathered early at the RadioShack in Farmington, Conn.'s Westfarms Mall.
Specialty apparel retailer Aeropostale drew big crowds in the early hours at Hamilton Place in Chattanooga.
Specialty apparel retailer Aeropostale drew big crowds in the early hours at Hamilton Place in Chattanooga.
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NEW YORK (CNNMoney.com) - Shoppers braved long lines and chilly temperatures to hunt down the juiciest deals Friday, with a retail group forecasting higher sales for the traditional kickoff of the holiday shopping season.

Wal-Mart, the nation's largest retailer, said that 2 million shoppers flocked to its stores in the first hour after they opened at 5 a.m. ET. The crowds were so thick that a brawl broke out among shoppers at one of Wal-Mart's Florida stores, according to eyewitnesses. (Watch shoppers scuffle in Florida -- :41)

The National Retail Federation (NRF) estimated shoppers could be on track to surpass the $22.8 billion they spent last year on the weekend after Thanksgiving.

"This will go down as one of the earliest and most promotional Black Fridays in history," NRF President Tracy Mullin said in a statement Friday. "Many stores opened earlier than ever before and retailers offered unbelievable sales and discounts to get people shopping."

But despite the robust start for retailers on one of the busiest shopping days of the year, at least one industry analyst was betting the early momentum will fade before the weekend's over.

"Everybody is coming with a road map. They have their circulars, downloaded coupons. It's definitely a race in the first few hours to get the hot products at the best price," said Marshal Cohen, chief industry analyst with market research firm NPD Group, who estimated that mall traffic was up 25 percent from last year.

"But I think consumers will back down after today. "This is what I call a false start," he added.

"I think the weekend will be good for retailers but next Monday, Tuesday and Wednesday will be tough days. People that I've talked to say they're spending a few hours today and then they'll return when the deals get better closer to Christmas."

Shoppers began lining up outside the J.C. Penney (Research) store at the Westfarms Mall in Farmington, Conn., at about 4:30 a.m. to take advantage of the early bird extra discounts -- also known as "doorbuster sales" -- which typically last until noon.

Wendy Haggerty, spokeswoman for the Westfarms Malls, said she saw shoppers crowding around the jewelry and cosmetics counters at Penney. "Penney's told us that they expected to do 70 percent of their sales for the day before noon," she said.

Penney's special promotions include up to 60 percent off on seasonal clothing and 1-carat diamond earnings or a bracelet in sterling silver for $99.

Lines up to 400 people deep were reported outside the Sears store at the Twelve Oakes Mall in Novi, Mich. "Sears is offering free $10 gift cards to the first few hundred shoppers. So that may have something to do with the early crowd," said mall spokesman Dan Jones.

John Ford, Sears' district manager for the northern region, told CNNMoney.com that the morning turnout at its department stores appeared to be stronger than last year.

"Electronics is clearly the winner of the day," Ford said. A Kodak digital camera and printer bundle for $149 was one of the most sought-after bargains, he added. He noted that jewelry sales were brisk but sales of winter coats and other cold-weather clothing had yet to pick up pace. (Full story).

Doorbusters

Meanwhile, KB Toys at the Hamilton Place mall in Chattanooga, Tenn., was scheduled to get its Black Friday business underway at 5 a.m., but opened earlier due to large crowds outside its door, according to mall spokesman Jeff Odom.

Freezing temperatures didn't deter bargain hunters in Dearborn, Mich., where the parking lot at the Fairlane Town Center Mall was already 70 percent full by 6:30 a.m., mall spokeswoman Kathy O'Malley said.

O'Malley told CNNMoney.com that, unlike last year, shoppers this year appear to be more targeted about where they want to shop.

"It's not haphazard shopping or scrambling to find the best deals," she said. "I spoke to one lady who was here at 4 a.m. and she had a newspaper with her showing the doorbuster ads. She had her stores circled and ranked one, two and three."

The bilingual Elmo was one of the hottest toys selling at the KB Toys store, while among the specialty stores it was teen clothier Aeropostale (Research) doing "bang-up business," O'Malley said.

Scott Krugman, spokesman for the NRF, said he wasn't too worried if the shopping pace slackened over the weekend.

"This is the regular pattern we see every start of the holiday shopping season where there is a lot of hype and energy at the beginning, and then people come back closer to the end," he said.

Wal-Mart: Good luck finding that $378 laptop

Wal-Mart spokeswoman Gail Lavielle said the retailer was "very pleased" with its traffic and sales trends so far.

"We had around 2 million people just in the first hour in Wal-Mart stores today," she said. "What's interesting is that people are looking for the deal items but then shopping for other things as well."

The retailer will detail its November sales performance Saturday and while Wal-Mart doesn't break out daily sales, Lavielle said it will provide a gauge of its Black Friday results.

Wal-Mart has been very aggressive with holiday pricing after it decided to skimp on deep discounts last year to try to boost profits -- a move that turned out to be a big blunder, with shoppers flocking to Target, Best Buy and other competitors instead. (Full story).

This time around, the world's largest retailer promised to give shoppers some of the best deals on consumer electronics and toys, two of the hottest holiday categories, and said it would match competitors holiday prices if they were lower than Wal-Mart's for the same product.

Discounted electronic gear was selling briskly, which could redeem Wal-Mart with some consumers, though there were also reports of stores running out of merchandise. (Full story).

Said Lavielle, "Electronics was definitely the first place our shoppers were going to."

Industry watchers had picked Wal-Mart's $378 HP pavilion laptop as one of the must-have deals of the season.

CNN showed video of shoppers scuffling at a Wal-Mart store in Orlando, Fla., with an eyewitness saying laptops were being thrown "20 feet in the air and people were collapsing on each other to grab them. It was ridiculous."

Shopping mania kicked off at midnight

Some malls couldn't wait to rev up business and opened their doors as early as midnight, offering free coffee to people who waited in line for the "doorbuster deals." A handful of retailers -- including Kmart -- were even open for business on Thanksgiving Day itself.

The holiday shopping season is crucial for retailers, many of which chalk up 50 percent or more of their annual sales and profits in November and December. The day after Thanksgiving is dubbed "Black Friday" because it traditionally marks the start of the season when retailers finally start moving into the black.

It's also one of the busiest shopping days of the year, second usually to the Saturday before Christmas. About 130 million shoppers are expected to go shopping over on Black Friday and the weekend combined, according to industry estimates.

Industry observers say retailers are particularly nervous about how the 2005 holiday season will shape up, given the spikes in gas prices over the summer and consumer concerns about inflated home heating bills in the coming weeks.

With all the uncertainty, it's not surprising that stores, especially the department store chains that have struggled to grow sales against the better-performing specialty stores and online retailers, slashed prices two weeks earlier than usual leading up to Black Friday.

The NRF expects its measure of total sales for the November-December shopping period to grow 6 percent to $439.5 billion, softer than last year's 6.7 percent increase.

Average holiday spending is also expected to be up 5 percent over last year to $738, according to the NRF.

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Consumers grab Black Friday deals on electronics. Click here for more.

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