Wal-Mart’s Roll Back Prices

The Christmas holiday shopping season is off to an early start and the discounts this year look pretty dramatic.

Thanks, in part, to the world's largest retailer.

For ten years, Wal-Mart has cut prices for the holiday shopping season, but never like this.

About 10,000 items marked down at every one of its US stores, from big-screen TV's, to clothes, to toys and appliances.

The retailer says it had to put more items on sale, because it believes the American consumer is running out of dough.

“Our customers are worried about gas prices, they're worried about real estate. I think in general, things are just tighter this year,” explains Julie Roehm, Wal-Mart Senior Vice President.

Do not expect Wal-Mart's rivals to be quite as aggressive. Many of them say it is still too early to get involved in an all-out Christmas price war.

Best Buy says while it may match Wal-Mart's discounts, it is emphasizing service, not price.

Experts say the real reason Wal-Mart is cutting prices is to make up for a lousy year. In which it tried to go too upscale with its fashion, and lost customers.

“Wal-Mart began the holiday season on November first, and they aim to gain a price leadership position, by taking price rollbacks, on many categories, whether it be apparel, electronics and toys,” explains Dana Telsey, Telsey Advisory Group.

This Christmas, the average shopper is expected to spend a little more than they did last holiday season, nearly $800.

In Chicago, independent retailer ABT electronics is keeping a nervous eye on Wal-Mart's strategy.

Meaning the real price wars may be still to come.

One of the busiest shopping days of the year is the day after Thanksgiving.

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