But despite an overall sluggishness, some categories are way up. Not surprisingly the hottest category at the start of the selling season was flat panel TV. The group reported that LCDs above 30 inches experienced 208.5 percent revenue growth and 297 percent unit growth. LCDs under 30 inches grew 26 percent in revenue and 86 percent in unit volume. Plasmas saw a 63 percent jump in revenue and a 140 percent increase in unit volume.
But with this growth came deep cuts in margins because of the low list prices. But Baker says the effect has a positive side. “You have to be real careful about what you say about pricing on Black Friday, because what many people are offering is well below cost. There’s money that comes out of other buckets to pay for those prices, which is why you see limited quantities,” he says “What I think it does do, however, is drive the interest people have in seeing these products as something everyone can now afford.”
Still, some in the industry wonder if such low prices risk a consumer perception that the prices have to remain this low the rest of the year.