U.S. shoppers turned out in strong numbers at the start of the holiday season on Friday to hunt for bargains, though many said they were spending more selectively.
Black Friday, the day after U.S. Thanksgiving, is often the busiest shopping day of the holiday season, during which the retail industry rings in nearly one-fifth of annual sales.
This year retailers and investors are paying close attention to signs of a consumer comeback that could propel the economy, after the 2008 holiday season saw the worst sales performance in nearly four decades.
Retail analysts who hopped from mall to mall across the country on Friday saw larger crowds and said customers were toting more shopping bags than last year.
But they note that an early surge does not guarantee a strong selling season in the weeks up to Christmas, and industry forecasts range from a rise of 2 percent to a decline of 3 percent for sales during the entire period.
There's lots of people in this store -- there are lots of shopping bags, Macy's Chief Executive Terry Lundgren told Reuters, referring to the company's flagship store in Manhattan's Herald Square. But we've got several hours before we can declare victory.
For the most part, shoppers were out for business rather than sport.
Linda Stone showed up early at the SouthPark Mall in Charlotte, North Carolina, with her friends, who have made Black Friday trips a group tradition.
There's more people than we've ever seen, said Stone, clad in a Christmas-themed, snowman sweatshirt. I think there's more people up and around hunting for those deals because of the economy and where a lot of folks are now.
The Standard & Poor's Retail Index was down 1.3 percent on Friday afternoon, slightly better than a 1.7 percent decline for the wider S&P 500 that was fueled by concerns over a possible debt default in Dubai. Retail shares had surged 47 percent this year on hopes for a consumer-led recovery.
For a graphic on U.S. holiday sales trends, click on http://graphics.thomsonreuters.com/119/US_RTLXMS1109.gif
For a Reuters Insider segment on holiday sales, click on http://link.reuters.com/wuj63g
Up to 134 million U.S. consumers say they may shop for holiday gifts this weekend from Black Friday through Sunday, according to the National Retail Federation.
Discount retailers like Wal-Mart Stores Inc and Target are expected to see the heaviest traffic over the holiday weekend, followed by department store chains like Macy's and Kohl's.
Jefferies & Co analyst Randal Konik recommends specialty retail stocks, and said his top holiday picks were Abercrombie & Fitch Co, Coach Inc, Gap Inc and Urban Outfitters Inc.
Konik visited a Long Island, New York, outlet center at midnight and said store traffic was heavier than a year ago, while promotions of 20 to 40 percent off were more prevalent than the discounts of 50 percent or more seen in 2008.
Last year's frenzied bargain-hunting led to the death of a Walmart worker in Valley Stream, New York, after shoppers broke down doors to enter the store at 5 a.m.
Shoppers came out in force before dawn this year as well, but the environment was more controlled as stores took extra precautions such as opening earlier and policing how people walked through their doors.
I was scared to come out. Last year was horrible -- women pushing and grabbing over shoes. This is nothing like that, said Helene Mitauer who was shopping at Express in center city Philadelphia, where the term Black Friday was coined in the 1960s to refer to the start of holiday sales events.
The sales are amazing but I honestly expected more of a really big deal, she said.
SHOPPERS MEAN BUSINESS
Retail chains have insisted they will not be forced to offer the fire-sale discounts seen in 2008 and have spent the last year shrinking inventory and scaling back stores to protect their profits.
At the same time, consumers have spent more time researching their purchases beforehand and strategizing about the best way to get them.
This year it was all about knowing what you were going to find before you walked in the door, said Marshal Cohen, senior analyst at retail consultancy NPD Group. The chaos and frenzy has been eliminated. Now it's a serious business opportunity and a serious savings opportunity for the consumer.
Nate Bryan lined up at 2.30 p.m. EST on Thanksgiving Day to wait for a midnight opening at the Best Buy Co store in Springfield, Pennsylvania, intent on buying a laptop for his daughter. It's normally $1,000 and now cut in half. That $500 can go to other things.
Debbie Techac, who spent more than 12 hours outside a Best Buy store in Phoenix, Arizona, said she planned to buy a Dyson vacuum cleaner cut to $329 from $549, two laptops and DVDs.
Shoppers also said they learned a lesson from years of easy credit and carefree spending.
Lillian Shine, who lives in Oakland, California, expects to spend more this year, since her shopping list included a 40-inch LCD Samsung television for $597. But she said she was paying for the TV in cash and buying fewer gifts.
I'm cash and carry. If I don't have the cash, it's not happening, she said.
(Additional reporting by Phil Wahba and Dhanya Skariachan in New York, Tom Hals in Springfield, Pennsylvania, Jessica Hall in Philadelphia, Joe Rauch in Charlotte, Tim Gaynor in Phoenix and Nicole Maestri in San Franciso; Editing by Michele Gershberg and Matthew Lewis)