From the WSJ today:
* NOVEMBER 26, 2008
Count on TVs Being Cheaper For the Duration
Retailers Are Likely to Extend Discounts After Black Friday; The Question of When to Buy
By CHRISTOPHER LAWTON
Good news, shoppers: This year, you may not have to get up at 3 a.m. the day after Thanksgiving to get a good deal on a flat-panel TV.
Television retailers and manufacturers always slash their prices on that day, known as Black Friday, to spur sales on what is typically the biggest shopping day of the year. Then after Thanksgiving weekend, prices usually bounce back to normal levels.
But amid a weakening economy this holiday season, there are signs that many of the discounts will stick around through the end of the year. That means shoppers seeking a TV could have several extra weeks of lower-than-usual prices to find the right deal.
"We're hitting a bad time, and I absolutely believe what's going to happen [is] we're going to see some very aggressive deals on Black Friday," says Riddhi Patel, an analyst with market-research firm iSuppli Corp. "Those Black Friday prices will continue all the way through December."
Indeed, some vendors and retailers have already started discounting their wares. Prices for 32-inch LCD TVs -- the TV industry's most popular size -- and 37-inch LCD TVs fell 2% during September, a month when there was no price decline last year, according to PriceScan, a price- and product-comparison service. In October, prices fell an additional 5%, compared with a 1% decline in the same month last year.
The Black Friday discounts will be even heftier, according to estimates. A 32-inch LCD TV will be discounted 54% to an estimated $399 in limited quantities on Black Friday from an average $875 in October, according to iSuppli. If those prices don't spur sales over Thanksgiving weekend, Ms. Patel says, many of the discounts will continue in December.
The price-cutting is being fueled by more than just the slow economy. Last year, some sizes of liquid-crystal-display and plasma TVs were in tight supply. Wanting to avert any shortage this holiday season, electronics manufacturers increased their output, counting in part on the February 2009 transition from analog to digital airwaves to boost TV sales. But the increase in inventory coincided with the onset of the economic slump, leaving the TV industry in a bind.
A Question of Timing
Discounts are steep -- but may get even steeper.
* On Black Friday, a 32-inch LCD TV will be discounted to $399, down 54% from October, a research group estimates.
* Many retailers, including Best Buy and Wal-Mart, plan more promotions before Christmas.
* If holiday sales are slow, watch for deep post-Christmas discounts as well.
Bob Scaglione, a senior vice president at Sharp Corp., says he has never seen TV vendors bring back "doorbuster" prices -- extremely low prices on specific items -- after Black Friday in the past, but he's "not sure what's going to happen this year." Mr. Scaglione says Sharp has some broader promotions planned for the weeks after Black Friday, but he adds that those promotions are part of a longer-term pricing plan that hasn't changed.
In another sign that TV discounts will be more lasting this year, retailers such as Best Buy Co. and Wal-Mart Stores Inc. are for the first time adding more promotional selling days between Black Friday and Christmas. For instance, earlier this month, Wal-Mart started its "Operation Main Street" initiative, in which each week the company will cut prices on certain products in electronics and other fields.
Best Buy, meanwhile, is for the first time offering special deals on TVs and other electronics to members of its Reward Zone loyalty program, starting the week after Black Friday and going through the holidays. For the first time ever, the company also extended an 18-month no-interest financing deal across the entire store for purchases of $500 or more for the entire holiday season.
Josh Will, Best Buy's vice president for home theater, says the company understands "the economy is tough right now" and adds that it's trying to provide confidence to its customers that they have the best value. Mr. Will says Best Buy's specific doorbuster prices on Black Friday won't resurface after that day, but shoppers will see other, similarly compelling offers on a wide range of TVs after Thanksgiving weekend.
Consumers who wait to buy until after the holiday season may be in for even bigger price cuts. In the past, the days after Christmas and the month of January traditionally have been good times to buy, as vendors discount their wares leading up to the Super Bowl, the most-watched television event of the year. This year, if slow retail traffic continues throughout the holidays, the post-Christmas discounts will be deeper.
Of course, there are downsides to waiting. Supply of some "doorbusters" is limited, so shoppers who wait too long could find fewer choices in some categories, such as TVs with particular screen sizes.
Plus retailers are dangling some attractive deals already. Kmart, a unit of Sears Holdings Corp., featured a 32-inch Osram Sylvania LCD HDTV for $440 earlier this month, for instance. Best Buy this month was offering a 32-inch LG Electronics Inc. LCD TV for $550, down from $800.
Michael Borges, a retired teacher from Westport, Mass., decided not to wait. Earlier this month, the 57-year-old pounced on a preholiday sale at Wal-Mart to purchase a 46-inch high-definition flat-panel television from Sanyo North America Corp. for $798, significantly lower than the average selling price for October. "I really don't enjoy waiting in line for any reason," says Mr. Borges. "I'm glad to have that out of the way."
Other shoppers are holding out for better deals. Brian Reinke, an engineer from Redding, Calif., is planning on buying his nine-year-old son a 50-inch plasma television for Christmas. But Mr. Reinke, who wants to pay $700 to $800 for the TV, says he hasn't yet found a deal he likes. The 30-year-old says he'll definitely shop for a deal on Black Friday, but "if Black Friday is a bust, maybe I'll wait," he says. "I don't have to buy it now."
Write to Christopher Lawton at
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