Big-Screen TV’s Will Be Deeply Discounted This Holiday Season

U.S. consumer’s can expect to see price cuts of up to 40% from a year ago on big-screen TVs, plus free shipping deals and even a 36-month financing option, in the run-up to “Black Friday” on November 25, the unofficial start of the holiday selling season.

Unlike last year, when large-box electronic retailers held the line on discounts, there could be an all out literal blowout this holiday shopping season. “As we look at the holiday season, we are going to play offense,” Hhgregg Inc Chief Executive Officer Dennis May told Reuters in an interview last week. “We are going to be very promotional. We are going to be aggressive.”

While consumer confidence has been lagging as of late in the sluggish U.S. economy, so has the need to replace TV’s or upgrade to larger ones. Adding to the mix is the lackluster cycle in the TV market. Early last week, Japan’s Sony Corp. warned investors that its TV division is headed for its eighth consecutive annual loss, while rival Panasonic Corp forecast its biggest annual net loss in a decade.

Global demand for televisions is expected to fall about 1% in the fourth quarter, according to Paul Gagnon, director of North American TV research for consulting firm Display Search. This will help fuel the deep discounts that bargain shoppers will be looking for.

“It is starting even earlier than usual. You are seeing sharp promotions. You are seeing Wal-Mart out there with a TV this weekend and Amazon.com with special deals. It is upping the overall intensity,” Bernstein analyst Colin McGranahan said.”It is going to be a dogfight. Everyone’s going to be fighting because demand is not great.”

Best Buy has announced it would offer free shipping on online orders from November 1 through December 27. On TVs costing more than $899, the world’s largest consumer electronics chain is offering 36-month financing, a 60-day price guarantee and a promise to even pick up the TV from the customer’s house if the model was not what he or she really wanted. “Given economic realities, consumers are definitely more discerning this holiday season, definitely looking for the best value for their money,” Mike Mohan, senior vice president and general manager of Home Theater at Best Buy, said.

Needless to say, the smart consumer looking to upgrade a television to a larger size probably won’t have to look too hard for a few good deals. It looks as though they will be bombarded from all directions with good deals. It will be a matter of which one to take advantage of.

written by

Kyle Pinder has has over five years trading and research experience in the large cap space. While still in grad school, Kyle trades daily and keep Active Investor up to date with the latest breaking news coming out of Wall Street and Washington.
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