Wal Mart, not surprisingly, took the first step. Forbes reported on October 1:
Wal-Mart Toys With Xmas Strategy: Retailer will target cash-strapped consumers with low-priced playthings for their tots.
"Wal-Mart took the holiday-season initiative on Wednesday, announcing that it would be cutting prices on several toys in 3,500 American stores as a way to draw shoppers for the important year-end period. Wal-Mart (nyse: WMT - news - people ) said it made the call after conducting a survey that showed consumers will start Christmas shopping earlier this year in order to stretch their holiday dollars. Though Wal-Mart caters to low-income shoppers, retailers have been hurt by sluggish spending due to rising food and energy prices, the housing slump and a generally weak economic climate. (See "Trouble On The Street For Retail.") The industry doesn't see a quick fix to those trends and is anticipating a subdued holiday season."
Read the full article: "Wal-Mart Toys With Xmas Strategy."
One day later, KB Toys strikes back. From Forbes:
"Retailer matches Wal-Mart's $10 pricing strategy.
KB Toys said Thursday that it would be cutting prices on more than 200 toys to $10 or less in an effort to draw consumers to its stores and to compete against the large discount retailers. Wal-Mart (nyse: WMT - news - people ) made a similar move on Wednesday. (See "Wal-Mart Toys With Xmas Strategy.") The discount store has been able to fare the rough economic climate better than most as people flock to it for one-stop shopping. But smaller retailers like the privately held KB Toys have been having a hard time of it."
Read the full article: "KB Toys Strikes Back."
So how black will "Black Friday" be for retailers? And how will these pricing wars pan out? We welcome comments from our readers and will be keeping track of developments.
No comments:
Post a Comment