Snow Storm Delayed $1B in Sales for Retailers

Offering some bad news for retailers in what has so far been a stronger-than-expected holiday season, influential industry trend website ShopperTrak on Wednesday revealed lower sales during Christmas week and a steep decline in foot traffic.

Retail sales for the week ending Dec. 25 slipped 4.1% compared with last year, while the retail traffic index saw a 6.8% drop in total U.S. foot traffic for the same period.

ShopperTrak said it was the 2010 calendar shift that placed Dec. 26 on a Sunday as opposed to a Saturday last year that had the greatest impact on overall performance.

Because it was a Sunday, Dec. 26 was not counted in the Christmas week performance, eliminating one of the highest traffic days of the year. Last year, Dec. 26 was the second highest day by traffic behind Black Friday.

“It seems the calendar was a bit unkind to retailers this year as the 2009 comparison week is particularly strong and a critical day in the season fell on a Sunday which created some unique challenges,” said Bill Martin, founder of ShopperTrak.

In some locations, he noted, retailers weren’t able to extend store hours on a Sunday due to various regulations, such as Blue Laws, leaving shorter windows of time to move merchandise. Also, parts of the South and Northeast were pummeled with a blizzard on Sunday, keeping many shoppers at home.

The blizzard crippled the Northeast on Dec. 26 and Dec. 27, strongly impacting retail traffic in the region. Northeast foot traffic fell 6.1% on Sunday, while the Midwest, South and West had an average gain of 38.6%.

Despite strong gains in certain regions, total U.S. foot traffic on Dec. 26 was 11.2% below what was expected had the blizzard not hit the Northeast.

Foot traffic remained down two days following Christmas as well, slipping some 42.9% in the Northeast on Dec. 27 from the year-earlier period. ShopperTrak estimates that a total of $1 billion of retail spending was postponed during the two-day period.

“At this point the prospect of momentarily pausing a potential $1 billion in sales has the collective industry holding its breath,” Martin said. “It will be interesting to see if levels recover in time to boost December sales and the overall holiday shopping season.”

The news follows a slew of positive numbers out of ShopperTrak since the start of the holiday season, which predicted strong sales through Black Friday and the weeks leading up to Christmas.

Retailers across the board from Macy’s (NYSE:M) to Amazon.com (NASDAQ:AMZN) saw strong sales in the weeks heading up to Christmas, with in-store and online sales higher than the year prior on strong promotions and discounts. Consumer electronics retailers like Best Buy (NYSE:BBY) also saw gains as people gifted high-priced items like eReaders and Apple (NASDAQ:AAPL) iPads.

Sales between Super Saturday and Christmas, though lower comparatively, saw a boost from Dec. 23, a day dubbed by ShopperTrak as ‘Father’s Day’ because of procrastinating male shoppers. ‘Father’s Day’ this year turned out to be the second most profitable shopping day for retailers behind Black Friday, taking in about $7.86 billion.