NEW YORK (AP) — In a story Jan. 14 about holiday sales, The Associated Press reported erroneously the full name of a yoga-inspired clothing company. It's Lululemon Athletica, not Lululemon Athleta.
A corrected version of the story is below:
Holiday sales rise on discounts, online shopping
Retail trade group: Holiday sales up 3.8 pct on discounting, online shopping
By ANNE D'INNOCENZIO and JOSH BOAK
AP Business Writers
NEW YORK (AP) — Holiday shoppers were more than willing to spend during the holiday season, if they saw big discounts or were shopping online.
Sales rose 3.8 percent from last year for November and December combined, according to the National Retail Federation's analysis of federal figures. That was a healthy gain in a season that kept merchants worried right up until Christmas as people held off on spending.
That caution and increased online shopping made the holiday less festive at the mall. Shoppers stayed away from many traditional destinations like department stores and electronics stores.
The sales increase came in just shy of the trade group's forecast of a 3.9 percent gain. It was better than the 3.5 percent increase in 2012 and the 3.3 percent average for the past 10 years.
"It was a knock-down, drag-out battle between retailers to see who could discount the most to generate the most traffic," said Ken Perkins, president of Retail Metrics LLC, a research firm.
For retailers, those discounts came straight out of their profits. Many have cut their forecasts for the fourth quarter, and profits are expected to be the weakest since second quarter of 2009, when the economy was coming out of the Great Recession.
Perkins estimates that fourth-quarter profits will fall 0.7 percent from last year, the first decline since a 6.7 percent drop seen during the second quarter of 2009, according to his tally of 120 retailers.
January is already off to a slow start. Some stores like Express Inc. and Lululemon Athletica have said weak January sales are compounding their holiday-season woes. Express said it plans to continue heavy sales promotions, which it expects to last through the month.
"The consumer is fatigued and taking a break," Perkins said.
Retailers' fiscal year typically ends in late January or early February to include the pre-Christmas and post-Christmas seasons. A lot is at stake. November and December account for 20 percent of the retail industry's annual sales, on average.
Jack Kleinhenz, economist at the National Retail Federation, agrees that the holiday season was challenging.