Walmart kicks off online holiday deals early in intense season

Reuters

By Dhanya Skariachan

NEW YORK, Nov 1 (Reuters) - U.S. retailers facing theshortest holiday season in years are preparing to assailcustomers with deals and promotions this week, before they haveeven digested their Halloween candy.

Wal-Mart Stores Inc is kicking off its online dealson Friday, a month earlier than usual - underscoring worriesthat intense discounting aimed at luring budget-consciousshoppers could result in the most tepid holiday spending rise infour years.

U.S. retailers have traditionally kicked off theall-important holiday shopping season on or the day afterThanksgiving and saved some of their best online deals for"Cyber Monday," the Monday after Thanksgiving when workersreturn to offices and use computers to make holiday purchases.

This year, the holiday falls on Nov. 28 and a result thereare six fewer shopping days between Thanksgiving and Christmas,prompting many retailers to jump the gun on incentives.

Some analysts say the holiday season, which typicallyaccounts for the lions' share of most retailers' annual revenue,will be the most heavily discounted in years as competition forshrinking budgets ramps up.

Walmart will hold an online sales event on Nov. 1 that willfeature items from JVC 42-inch LED televisions for $299 to Xelio10.1-inch tablets for $49. Those are Walmart.com's lowest pricesin those categories.

The world's largest retailer is also offering free shippingon about 99 percent of its online items this year for ordersover $50. Last year, only 15 percent of its assortment qualifiedfor free shipping.

The earlier deals and bigger incentives come after data firmShopperTrak forecast the slowest holiday sales growth since2009, and other data showed consumer confidence tumbled inOctober as a partial government shutdown rattled households.

"We have had the debt-ceiling crisis and payroll taxincreases. There has just been a lot of pressure on the customerall year along," Joel Anderson, president and chief executive ofWalmart.com U.S. told Reuters earlier this week.

Morgan Stanley analyst Kimberly Greenberger expects thisholiday season to be the most promotional one since 2008. Shesees ecommerce accounting for about 12 to 13 percent of overallholiday retail sales versus last year's 11 percent.

LEADING THE CHARGE

Wal-Mart Stores Inc is on track to hit $10 billion in globalecommerce sales this fiscal year and expects to make more than$13 billion in such sales next year.

But Walmart is not the only one to court holiday shoppersearly.

Toys R Us, which started airing holiday ads earlier thanlast year and began a cash-back offer of up to $100 forloyalty-program members who buy certain toys by Oct. 31, is nowpromising them special access to Black Friday deals beforeanyone else.

Amazon.com Inc showed it was gaining market shareat a rapid pace, last week when it released earnings. It alsoshowed that it was still investing in techology, content,supply-chain management and international markets.

Target Corp says it, too, is spending more onholiday advertising, extending its price-match policy andexpanding its "buy online, pick up in store" service to all U.S.stores by Nov. 1.

"It has been a difficult, choppy year from an economicstandpoint," said Kathryn Tesija, Target's executive vicepresident of merchandising and supply chain. She expects holidayshoppers to be very budget-conscious.

Walmart and Target, both of which struggled to keep up withonline demand in 2011, said their websites are now betterequipped to handle any potential spike in traffic.

"We have really stress-tested in every form, function andfashion," Anderson said, adding that Walmart's website will beable to make more personalized offers to online shoppers andproduce more relevant results when they search for an item.

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