Holiday sales promising
Promotions draw shoppers to stores
By Clint Engel -- Furniture Today, June 1, 2008
High Point — Several furniture retailers reported brisk business during the Memorial Day holiday weekend — a welcome improvement for many, although few seemed ready to declare it a turnaround.
Retailers that promoted heavily drew the traffic. Some said that high gas prices may have actually helped as more consumers decided to stay close to home rather than travel.
"It was a good Memorial Day," said Todd Wanek, president and CEO of Ashley Furniture Inds., which has a network of 353 primarily dealer-owned Ashley Furniture HomeStores. "Most of our stores are reporting good comp store sales increases and overall traffic was very strong over the weekend. Consumers seem to be in a mood to buy."
While not all the numbers are in yet, Wanek estimated that same-store sales were up about 5% to 15% for the holiday weekend.
Ashley's Memorial Day sale circular promoted a government stimulus check angle as well as a no-interest financing offer until 2011. The HomeStores offered $300 in "bonus merchandise" with purchases of $1,200 or more, or $100 on purchases of $600 or more, or the financing offer.
Wanek said the financing had more appeal than the bonus because many consumers have yet to receive their stimulus checks. But he added that it's difficult to specify what drew shoppers because the stores also were promoting solid deals, such as a series of sofas at $497 and master bedroom groups from $667 to $1,697.
"It was really the promotion in general that was successful," he said. "The people who were aggressive and promoted over the weekend did a fair amount of business and did fairly well."
But it's too early to call it a trend, he said, adding that he would have to see several weeks of this kind of pattern before he could believe the industry might be turning the corner.
Darvin sales up 11.5%
Marty Darvin, co-owner of Orland Park, Ill.-based Darvin Furniture, was pleased with Memorial Day activity. Compared to last year, he said, sales were up 11.5%.
Darvin ran a pre-Memorial Day kickoff sale the week before the big weekend, bringing in inventory and aggressively promoting in categories ranging from home office and mattresses to youth furniture and upholstery.
He attributed the strong performance to the fact that some people are not traveling as much. And while they may not be buying new homes, he believes they are paying more attention to where they are living now.
"They have decided to fix up what they have," he said. "There are products in their homes that are wearing out, and they want to change styles. There are a lot of fresh looks on the market and they are not hesitant to buy furniture."
Darvin said the company has had strong sales momentum so far in 2008.
"We are cautiously optimistic that things will be good for the rest of the year," he said.
In San Diego, five-store Jerome's sales were up 14% for its four-day event period "and this was on top of decent numbers last year," said Lee Goodman, president and CEO.
Jerome's drew traffic without any financing offers or special discounts, Goodman said, noting that the company moved away from that type of promoting about 18 months ago. Instead, it ran TV ads showing sharply priced goods and promising its version of everyday low prices. Jerome's calls that "Jerry's price," for Chairman Jerry Navarra.
"There were no gimmicks or giveaways. We recognized the holiday, celebrated and honored it, and everything else is doing what we've been doing every day," said Goodman.
"We're riding on momentum," he added, noting that written business is up double-digits this year. "We don't feel the economy is helping us. But we feel we are helping us, and we're taking market share."
Rooms To Go's Memorial Day circular included an array of coupons, such as $500 off a Cindy Crawford leather sectional, or a free kids' futon with the purchase of a full-over-futon youth bed. On its Web site, RTG extended the event to Tuesday and promoted two deferred payment financing plans.
The results were "a little better than the trends have been," said Jeff Seaman, president and CEO of the 115-store, Seffner, Fla.-based chain.
"I was wondering if people were waiting for the holiday to shop," he said. "Traffic was better than it has been, but I'd like to see what happens in June before I get too excited."
Stretching the sale
Jonns Contemporary Interiors of Montgomeryville, Pa., had good traffic on Saturday, but a slow Sunday. During abbreviated Monday hours, the store had decent traffic with "fair to middling business," said Vice President Marie Kooker.
She said sales were the only things bringing people into the store. Rather than making the Memorial Day sale a three-day event, Jonns extended it until the end of May, promoting it with mailings, radio ads and banners.
Kooker added that with perfect weather over the weekend in southeast Pennsylvania, she assumed people would be driving to the New Jersey shore.
Instead, high gas prices seemed to keep many closer to home, based on the surprisingly large crowds she saw at the local shopping center.
"I'm not saying they spent a lot of money," she said, "but they were staying around."
| Acknowledgements | ||
| Staff Writer Jeff Linville and Associate Editor Thomas Russell contributed to this story. | ||
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