Wednesday, November 29, 2006

Who is driving the SALE?

You probably have sensed that the sale started very early this year. Almost all department stores started sale, or private sale, before Thanksgiving.

What happened? Who started first? What are the consequences?

It started with the Neiman Marcus private sale two weeks before Thanksgiving. There was a link to the department store's website with the entire Chloe and Alexander McQueen's ready-to-wear collection at 30% off. The private sale only lasted for one day, but many bag lovers grabbed the Chloe bags within hours.

When I visited Bergdorf Goodman at around the same time, I was informed by the sales people that they could put certain items on hold for me as pre-sale. I was surprised by how early it came, but went ahead to pick up some clothes without hesitation.

Then the domino fell. All department stores including Saks Fifth Avenue started "pre-sell" a week from the Thanksgiving fearing that the customers would be drawn to Neiman Marcus only.

Why did they start the sale so early this year? The economy is doing well, and the stock market is at historic high. They could have kept selling things at retail price hoping that the bankers buy those nice gifts before Christmas. But the stores didn't wait.

One related event was a comment made by Mr. Prada in a fashion award event. He called for early fashion show schedule and gained support from major department stores in the US to stock their pre-collection inventory months ahead of the normal time. It also seemed to me that the department stores increased their budget for cruise (pre-spring) collections and increased their inventory. If that was the case, then it totally made sense for the department stores to mark down the price early just so they made enough room for the cruise collection shipments.

As the last part of the sale chain, small business felt the pressure. All those boutiques selling contemporary clothing are now marking things down to 30% to 80% off the original price already. The Alexander McQueen boutique received customer's phone call right after the Neiman Marcus private sale requesting an earlier sale. The store started their private sale days before their normal schedule due to the customer requests they received.

I am very curious to see what happens next year. Is it a new practice now? Is it going to be sustainable? Well, the bottom line is that we consumers and fashion lovers gain. At least I've got my long-waited Alexander McQueen clothes and my Fendi skirt.


Ian said...

When is the normal time for sales? I thought it was closer to December/January?

Jing said...

In the states, it started already. Normally it's the day after thanksgiving, but this year they did it a wk or two earlier.