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Television retailers are going to have one simple message for shoppers this coming holiday season: Supersize it.
The lack of anything really new to tout means that mass merchants, online and specialty retailers will try to get people to trade in that once fancy 42-inch flat screen TV for one that is 60- or even 90-inches, and at lower prices that wouldn't have been fathomable a couple of years ago.
The only problem: If consumers play hard to get, then margins -- for manufacturers and to some extent, retailers --could get slammed.
The margin pressure "is being felt on all sides," said Ben Arnold, NPD Group's director of industry analysis, adding that manufacturers are being squeezed harder.
On average, a 50- to 52-inch LCD TV is expected to sell at $829 this year versus $1370 last year. But the price of a 50-inch LCD TV could fall to as low as $529 or even $499 on Black Friday, the kickoff to the biggest selling season of the year, said Tamaryn Pratt, principal of Quixel Research.
While retailers can try to combat the profit hit by selling more high-margin installation services or TV accessories, manufacturers have fixed production costs to meet no matter what they earn on the televisions they sold, Arnold added.
Top retailers Best Buy, Amazon.com, Wal-Mart and Target told Reuters they were planning to carry a bigger assortment of large screen TVs this year.