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Holiday retailers strive 'to steal each other's market share,' analyst says


Published: Thu, November 23, 2017 @ 6:32 p.m.

Associated Press

NEW YORK

Shoppers are hitting the stores on this Thanksgiving and are finding some surprises: toys and TVs at J.C. Penney, Barbies at Best Buy, kitchen appliances like wine refrigerators at B.J.'s.

As the holiday shopping season officially kicked off today, retailers are counting on a lift from a better economy. But they're also looking beyond economic data and mapping out ways to pick up sales from other retailers as Amazon expands its reach.

That can mean opening earlier than rivals on the holidays or even jumping into new product categories. The fight for market share comes as analysts at Bain say Amazon is expected to take half of the holiday season's sales growth. And Amazon is the top destination for people to begin holiday shopping, according to a September study by market research firm NPD Group.

"The retailers are in survival mode. It's about stealing each other's market share," said Marshal Cohen, chief industry analyst at NPD. "Amazon is the Grinch. They're stealing the growth."

Abi and Sush Gyawali — both 27-year-old biology graduate students at the University of Missouri — were among hundreds of people who lined up outside J.C. Penney in Columbia, Missouri, before the store opened at 2 p.m. Thursday.

Abi Gyawali normally shops online on Amazon or BestBuy for Cyber Monday, where he said he finds some of the best deals. But he said the couple wanted to check out the scene at the local mall Thursday before friends came over later to share a meal.

"It's good," he said. "At least people are not as crazy as they behave in big cities."

With the jobless rate at a 17-year-low of 4.1 percent and consumer confidence stronger than a year ago, analysts project healthy sales increases for November and December. The National Retail Federation trade group expects sales for that period to at least match last year's rise of 3.6 percent and estimates online spending and other non-store sales will rise 11 to 15 percent.

Amazon is expected to be a big beneficiary as it cements loyalty among its Prime members and moves into new services and private-label merchandise. The company has introduced more than 20 such brands in the past two years in clothing, electronics, groceries and more, says Bain.

That leaves stores looking at rivals to see where they can pick up sales. There are extra dollars up for grabs this year, after thousands of store locations have closed and several retailers including Gymboree and Toys R Us filed for bankruptcy protection.

Greg Foran, CEO of Walmart's U.S. division, said that the retail giant's holiday shopping season appeared to be off to a good start. It got things going in the first minutes of Thursday with an online sales event that featured a range of deals from toys to TVs to slow cookers and Google Home mini gadgets.

"We are in good shape," Foran told The Associated Press. "We have a bit of momentum and we had a good kickoff online, and with a bit of luck we are going to have a good 24 hours and be ship shape for the weekend, and go from here to the 25th of December."


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