Fellow shopper Carol Maxine rarely used to do her Christmas shopping in department stores. This year, the 30-year-old from Parramatta has bought the bulk of it at upmarket department store David Jones and Grace Bros, part of the mid-market Myer Grace chain owned by Coles Myer, Australia’s biggest retailer.

Ms Maxine readily admits she has been lured into the big department stores by the early Christmas sales and the bigger and better range of “clothing shoes, homeware and electrical”. Since the Boxing Day stocktake sales began in the 1960s, a generation ofAustralians has grown accustomed to reserving a wad of their consumer spending for the week or more of retail bargains that were available after Christmas.

Led by Myer Grace, the department stores are determined to shed their dinosaur image and grab a bigger share. A survey this month by veteran retail analyst Barry Urquhart found women were using Myer, Grace Bros and David Jones department stores as thepreferred destination to do their shopping.

LIKE many Australians, Carley Edmonds and Tom Mutch look forward each year to the traditional post-Christmas sales. This year they are spending up bigger before Christmas, taking advantage of bargains produced by a new retail battle between the nation’s biggest department stores.

The couple spent much of yesterday — only six sleeps before Christmas — visiting “every store” in Sydney’s Pitt Street Mall. They are “definitely” spending more money than last year.

“We’ve been going for the sale items to save money and get better bargains, so we’re able to buy more things for the one person,” Mr Mutch said.

Fellow shopper Carol Maxine rarely used to do her Christmas shopping in department stores. This year, the 30-year-old from Parramatta has bought the bulk of it at upmarket department store David Jones and Grace Bros, part of the mid-market Myer Grace chain owned by Coles Myer, Australia’s biggest retailer.

Ms Maxine readily admits she has been lured into the big department stores by the early Christmas sales and the bigger and better range of “clothing shoes, homeware and electrical”. Since the Boxing Day stocktake sales began in the 1960s, a generation ofAustralians has grown accustomed to reserving a wad of their consumer spending for the week or more of retail bargains that were available after Christmas.

But the new trend of Us-style deep Christmas discounting has been sparked by an aggressive promotional sales campaign by Myer Grace Bros, and matched by David Jones.

Up for grabs this year is $27 billion in Christmas spending, according to the Australian Retailers Association.

That is nearly $1.5 billion more than last year’s spend in the six weeks to Christmas and some $8.5 billion over 2001.

And, led by Myer Grace, the department stores are determined to shed their dinosaur image and grab a bigger share. A survey this month by veteran retail analyst Barry Urquhart found women were using Myer, Grace Bros and David Jones department stores as thepreferred destination to do their shopping.

“That’s probably the most significant change you have seen in shopping behaviour in more then a decade,” says Mr Urquhart.

It’s a sign that after years of losing ground to brighter, bigger, and more aggressively

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marketed “category killer” super stores for everything from clothing to sporting goods and furniture, the big department stores are back in business.

“There is no doubt that retailers are becoming more aggressive pre-Christmas,” says David Clark, chief operating officer at Harris Scarfe , which this week began its “Where Christmas costs less” sale with discounts of up to 50 per cent across 24 stores in Victoria, NSW and South Australia.

Perhaps the most telling sign of how some fashion chains have had to react to the might and power of the department store chains is at Country Road.

On Friday last week, the Australian icon brand kicked off a 20 per cent to 25 per cent discount across most of its mens and womens clothing range as well as homeware. The sale was in reaction to promotions running at David Jones, which carries a large range of Country Road merchandise.

This week, David Jones tightened the screws and introduced a 40 per cent clearance sale.

Australian designer label Marcs last week began offering 25 per cent discounts to lure its target market of “18-35 years old stylish urban men and women”. And upmarket Italian designer label Prada brought forward its sales campaign with 30 per cent off belts, handbags, shoes and some mens and womens clothing.

Not that all retailers like it.

Gerry Harvey, the billionaire who sits atop furniture and electrical store group Harvey Norman said department stores offering pre-Christmas sales had “half developed brains”.

“When you start having your promotions before Christmas, you then tend to take the shine off after Christmas.”

Brett Blundy, who heads Brazin, owner of Sanity Music and Bras’ N Things, is resisting discounts and says any early sale is a sure sign of bad buying earlier in the year.

“I can only assume they have cocked up a few things,” he says.

But, for many retailers, the alternative to pre-Christmas discounting is silence at the tills. Shops assistants at a deserted looking Stewarts Gentlemen Outfitters in Sydney, where a shirt can sell for $200 or more, say a lot of people are waiting for the post- Christmas sales. Maybe the shopers are at Myers or Grace Bros.

Under the hand of Myer Grace boss Dawn Robertson the business has been reinvigorated, with new store fitouts, better merchandise and customer service at its national network of 66 department stores. But to draw in the customers and keep slow stock moving, she is running promotional discount campaigns, and lots of them.

For the 36 David Jones stores, it means the end to the easy domination of the department store market. DJs introduced another Christmas offer on Thursday — its fifth since it kicked off its campaign on November 26.

Myer Grace has run four in the past three weeks but insists that its pre-Christmas strategy had been planned at the start of the year. By September, Christmas shows, catalogues, marketing and merchandise had been finalised with dummy store set ups and trial runs and store managers were gathered to the chain’s Melbourne head office to fine tune the execution.

ARA national president Mr Stan Moore believes this year’s pre- Christmas sale activity by Myer Grace reflects “a level of American influence”.

Ms Robertson was an executive at the US Federated Department Stores Group, which owns Macys and Bloomingdale’s.

“You see the strategy in America … where discounting appears just before Christmas,” Mr Moore says. “The view of the retailers in America is to move volume at deep discount … it’s about gaining additional sales at the expense of your competitor.”

The winners in this are the customers.

Yvonne Fraser was taking advantage of the Adelaide sales to stock up on birthday presents for her husband and overseas relatives next year, while sheep and cattle farmers Sheila O’Brien and Dave Halloran made the two-hour trip from Kangaroo Island to spend over $500 on Christmas gifts.

Ms O’Brien said the sales meant she could buy gifts now rather than hold off for the stocktake sales: “You always feel more committed to buying stuff before Christmas,” she says.

Additional reporting by Rebecca DiGirolamo, John Stapleton and David King

More reports — Page 4

Editorial — Page 16