CHICAGO – Helen S. Wright calls herself a “Super Bowl Shopper.”

She visits stores regularly, browsing for fun, picking up small gifts for friends and comparing prices. These days Wright won’t even consider plunking down her money for something unless it is on sale.

“Why pay full price if you don’t have to?” Wright said.

It is a question that more and more shoppers are asking themselves these days.

With one of the most promotional holidays in decades still fresh in consumers’ minds, where outlet-style discounts of up to 70 percent were commonplace at mainstream stores, going back to paying full price is a tough sell. Indeed, the snow isn’t even melted yet and many big chain retailers including Chico’s, J. Crew and Lord & Taylor are slashing prices on early spring good as soon as they hit the shelves.

“Down 20 percent is the new full price,” said Marie Driscoll, director of consumer discretionary retail research at Standard & Poor’s in New York. “It’s what you have to do to get the consumer even thinking about shopping.”

Merchants are trumpeting markdowns at the front of the store and even in their windows in hopes of drawing reluctant shoppers through the door.

From her perch behind the cash register at a cosmetics store, sales clerk Stacy House has watched the markdown mindset take root. She witnesses customers putting back products that aren’t discounted, even when the full price is a good deal. “People will line up at the register and if they find out it’s not on sale, they will leave it and not come back,” said House.

“It’s more a state of mind in this economy. You are looking to get a deal rather than looking at the actual price.”


Fewer than 5 percent of shoppers say they will pay full-price for an item compared to 11 percent a year ago, according to an America’s Research Group survey of 1,000 shoppers earlier this month.

FBR Capital Markets analyst Adrienne Tennant likewise notes customers are showing little interest in full-priced items. She warns that this new pattern of “waiting for the markdown” is going to take its toll on retailers’ profits in 2009.

“We believe that the extreme discounting we have seen in the past several months has ‘trained’ shoppers to wait until merchandise goes on sale before purchasing,” said Tennant in a report this week. “This weekend, we noted a large number of discounts on new product, which leaves us further concerned about margins.”

The promotional fever isn’t going to go away as long as chain stores that are on the verge of going under slash prices to raise cash. Discounting at the weaker chains forces trickles throughout the retail landscape, prompting stronger chains to mark down as well in order to keep their customers.

“It’s the only way retailers can survive,” said Bonnie Carlson, president of the Promotional Marketing Association in New York. “They have to show that they’re very aware of what’s going on and that they’re catering to the consumer.”



(c) 2009, Chicago Tribune.

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AP-NY-01-29-09 1851EST


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