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A Few Popular Presents Rise Above Recession

By Ylan Q. Mui
Washington Post Staff Writer
Tuesday, December 30, 2008

The presents have been unwrapped, the tree taken down. And Santa still hasn't brought you that Wii.

Don't worry. You are not alone.

Despite the economic gloom and doom that saddled this Christmas shopping season, a few products rose above the recession and flew off the shelves faster than eight magical reindeer. Gifts such as the Nintendo Wii, Amazon's electronic book reader Kindle and those furry Ugg boots remain in short supply-- a sign that consumers may not be quite ready to cut every indulgence out of their budgets.

"If people think it's going to be rare and in short [supply], they're more apt to make it more of a priority," said Dan Butler, a vice president at the National Retail Federation, a trade group.

The Wii video game console has been one of the most elusive gifts since it debuted in November 2006. This year, the Wii and Nintendo's DS gaming console set sales records in November, and they are on track to beat the record for the most video game systems sold in one year, according to the company. Nintendo also opened a mini-store within the Toys R Us in Times Square to showcase the Wii and popular games such as Wii Music and Wii Fit -- both tough scores in their own right.

Retail analysts said the Wii was an attractive purchase this holiday for families searching for one gift that everyone could enjoy. Stores such as Best Buy and Wal-Mart stocked up on the console to lure customers on big shopping days such as Black Friday. But they still could not keep pace with demand. The day after Christmas, Google reported searches for the Wii were up 28 percent compared with the previous year.

Another hot technology this season was Amazon's Kindle, which still ranked as the best-selling electronic on the company's Web site yesterday afternoon, even though it was completely out of stock. An Amazon spokesman would not say how many have sold, but the company did post a message on its Web site for frustrated shoppers.

"Due to heavy customer demand, Kindle is sold out," it read. "Please ORDER KINDLE NOW to reserve your place in line."

Expected ship date: eight to 10 weeks.

Nintendo's Wii and the Kindle were two small bright spots in what has been a difficult season for electronics retailers.

According to a survey by SpendingPulse, a service by MasterCard that estimates national sales, spending on electronics and appliances during the past two months fell by more than 26 percent compared with last year.

Products with price tags above $1,000 performed particularly poorly. The Wii sells for roughly $250 while the Kindle goes for $359.

Apparel was another dismal sector this year, with holiday sales expected to fall about 20 percent, according to SpendingPulse. Retail analysts have deplored the lack of "newness" and "must-haves."

But somehow, those sheepskin Ugg boots costing more than $100 have yet to go out of style.

"It didn't even matter whether it was warm-weather or cold-weather climates," said Marshal Cohen, chief industry analyst for NPD Group, a market research firm. "It was selling out."

Several styles of the boots, including the classic short, classic tall and crochet versions, were sold out on Nordstrom's Web site yesterday and are not expected to ship for at least a month.

Nordstrom limits sales of Ugg products to four per customer at the request of the manufacturer, which was worried about shoppers reselling them online, said Brooke White, a spokeswoman for Nordstrom.

"Despite the economic downturn," she said, "when you have product that customers want, they're still going to seek it out."

Indeed, many products that are supposedly sold out wind up on the Internet -- often with a higher price tag. A search for crocheted Uggs yesterday turned up nearly 1,000 results. More than 3,300 Wiis were sold on eBay on Dec. 15 alone, the company said. Even the Kindle makes a cameo.

"The problem with selling out of anything is that everything is so readily available everywhere that there's just more product than we need," Cohen said. "Everybody has so much stuff."

Still, Butler said manufacturers and retailers often limit availability of popular items to ensure demand for the next year and to create the priceless buzz of exclusivity. Selling out can actually be a state of bliss for a retailer.

"The goal is to have exactly as much as you need to sell to the customer and not have anything left over," he said.

Other merchandise also performed well, even if it didn't reach that elusive sell-out status. Amazon said it sold enough copies of "Breaking Dawn," the fourth installment of the widely popular "Twilight" series of books, to scale Mount Everest eight times.

Toys R Us reported Legos and iPods -- particularly in pink -- were among its top sellers. And good luck trying to find the red Bakugan Dragonoid, said Gareb Shamus, publisher of Toy Wishes magazine. (If you don't know what it is, it's already too late.)

Still, this thin silver lining was swallowed up by what has been a largely stormy Christmas. Retail experts are anticipating the weakest holiday sales in decades, with little relief on the horizon for next year.

"One or two items don't make a season," Cohen said.

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