December 3, 2010 – By Dhanya Skariachan
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NEW YORK (Reuters) - From holding private movie screenings to commissioning new holiday music, retailers are getting creative as they try to avoid a sales lull after the Black Friday rush last week.
Reuters is monitoring the holiday strategies of handful of retailers to see how they change tack over the season. They include department store chain J.C. Penney Co Inc <JCP.N>, discounter Target Corp <TGT.N>, teen apparel chain Aeropostale Inc <ARO.N> Kmart parent Sears Holdings Corp <SHLD.O>, electronics chain Best Buy Co Inc <BBY.N> and Toys R Us.
Below, executives shed light on how far they will go to grab bigger holiday sales, which are forecast to rise 2.3 percent, according to the National Retail Federation.
TOYS R US
The world's largest dedicated toy retailer is carrying a bigger assortment of exclusive toys and has opened hundreds of temporary stores this year. It is now trying to woo shoppers through creative promotional events.
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The retailer, which ran a one-day event giving 50 percent off hot toys on Wednesday this week, is also planning to have doorbusters on late Friday and early Saturday and offering a chance to decorate gingerbread cookies.
"We still have some tricks up our sleeve," said Greg Ahearn, senior vice president, marketing and e-commerce.
Also, on Saturday, the retailer will bring Santa Claus to its U.S. stores from noon to 3 p.m.
Best Buy saw longer lines on Black Friday this year. Chief Executive Brian Dunn said smartphones, e-readers, computers and mobile computing devices were selling well.
The electronics retailer started promotions earlier than usual this year and hired more telephone agents. It is now planning a private screening of the Reese Witherspoon and Jack Nicholson film "How Do You Know" for some members of its loyalty program in 33 markets. The retailer will host private shopping events for members on Sunday, December 5 in 436 stores.
Starting December 6, Best Buy will open its U.S. stores at 8 am through the holiday shopping season, rather than the usual 10 am start. On Christmas eve December 24, it will open at 7 am.
Target saw strong sales in apparel, appliances and accessories over Thanksgiving, not just electronics and toys.
"It was a lot more balanced around the store this year," said Troy Risch, executive vice president of stores.
The discounter will air commercials that feature new holiday songs recorded for the retailer by Guster, Blackalicious and Bishop Allen, among other artists. The songs can all also be downloaded from Target's website.
Target is still counting on a 5 percent discount for shoppers that use its credit card to attract customers.
"We'll have a lot to learn over this next week about how the consumer is shopping," Risch said.
J.C. Penney, which discounted more than rivals Macy's Inc <M.N> or Kohl's Corp <KSS.N> over the Black Friday weekend, won more shoppers this year. It saw strong demand for women's boots, luggage sets and various items for men.
"You're going to see an very aggressive marketing campaign not just for Black Friday, but all the way through," said Steve Lawrence, co-chief merchant for Penney.
Penney, whose shoppers are seen as more vulnerable to the economy's swings than those of rival Macy's, feels it is necessary to stress discounts in its advertising.
Its efforts will also include ramping up newspaper inserts and sending out more coupons to mobile phones via text messages. It has launched a mobile commerce site that allows customers to buy items from their smartphones.
Sears Holdings Corp <SHLD.O> opened its namesake department stores for the first time ever on Thanksgiving Day and discounted heavily to win shoppers that week.
The company will focus on offering shoppers "Black Friday quality deals" to boost sales for the rest of the season.
"Customers told us they wanted access to those kinds of deep discounts and great deals more than just on Black Friday," said marketing executive David Friedman. "We did consciously decide to extend that kind of pricing."
The company plans to run a series of 2-day sales events on weekends and step up the pace of promotions in the last five to 10 days before Christmas Day.
Sears, which has seen customers show interest in categories such as large-screen televisions and gaming, will now offer discounts on fine jewelry and sleepwear as well.
Aeropostale CEO Thomas Johnson told analysts "there was a little bit of a hangover" on Saturday and Sunday following the company's successful Black Friday selling day.
He cited "competitiveness and pricing challenges that could be out there and face us for December." Aeropostale gave a cautious profit forecast for the holiday quarter that fell below Wall Street's projections.
The company depends on constantly rotating promotions that drive traffic to its stores.
The company, whose prices have historically been below competitors such as American Eagle Outfitters Inc <AEO.N> and Abercrombie & Fitch Co <ANF.N>, used a $10 hoodie sale to drive young shoppers and their parents to stores on Black Friday.
"You'll continue to see that kind of activity," said Kenneth Ohashi, vice president of investor and media relations, citing $5 graphic T-shirt promotions, deals that are planned and can still be "nicely profitable."
"For any week we have Plan A,B,C,D," Ohashi said, citing the company's flexibility to rotate promotions and quickly change tactics if needed. "Our stores can really flip the switch over night."
The company says it has become smarter about the merchandise it sells, and at what margin, after Christmas.
Some 40 percent of gift cards are redeemed that week, Ohashi said, so a new focus is on selling full-price items rather than clearance merchandise.
"We will set fresh product in stores for that consumer," he added.
(Reporting by Dhanya Skariachan, Brad Dorfman, Phil Wahba and Alexandria Sage; editing by Andre Grenon)