According to business owners, holiday spending actually rose in Mountain View, at least for businesses selling low-priced goods.
"People were getting things that were rich in quality but not in price," explained Nick Chaput, owner of Dana Street Roasting Co. and president of the Central Business Association. "I got the feeling that they were treating themselves" — but on smaller items like books, rather than expensive items like iPods.
In this environment, certain stores thrived. Although he wasn't seeing the usual post-September climb in sales leading up to the holiday season, Chaput says his coffee shop saw increasing sales beginning two weeks before Christmas. He estimates that sales increased 10 to 15 percent each week, rather than the 2 percent he'd expected.
Similarly, Books Inc. on Castro Street experienced an increase in sales leading up to the holidays. Customers there actually seemed excited about shopping, said manager Steven Sparkman.
Many of the items sold at Books Inc. were nicer, more expensive gift books, such as coffee table or cook books, Sparkman said. He added that some customers even requested hardcover copies of books already out in paperback in order to give a nicer gift.
"Let's say you've got a photographer" you're shopping for, Sparkman said. "You can afford a book about photography, even if you can't afford a new camera lens."
While sales at stores with lower-priced items exceeded expectations, other retailers were hindered by a hard economic year.
"Lean times require lean payrolls and lean inventories," said Wayne Whelan, co-owner of Therapy, a clothing and gift store on Castro. "We bought less, and we sold a higher percentage of what we had based on the fact that we had less on hand."
December sales were lower at Therapy's Mountain View store than they were in the 2008 holiday season. But the chain of stores, which includes five other locations in San Francisco, Campbell and Burlingame, saw December sales that were roughly even with the year before despite lower inventory.
"My expectations for this year are much higher than they were for last year," Whelan said. While he reduced inventory for 2009, he is buying more this year and is optimistic that he can sell it.
Most local merchants are still feeling the impact of the economy, but there is a sense of guarded optimism, said Chamber of Commerce president Oscar Garcia.
"I think the attitude of people in the business community is that 'We survived 2009, so what can we do differently to thrive in 2010,'" he said.
Garcia said more business owners are coming to events held by the Chamber to learn how to increase sales. At a networking event for small and mid-sized businesses, he said, nearly 300 people attended from as far away as Berkeley and San Jose. Normally such events average 120 to 150 people.
Nationally, consumer spending rose for the holiday season. Sales in November and December increased 1.1 percent to $446.8 billion, according to the National Retail Federation, which had forecast a 1 percent decrease in sales over that period. In 2008, holiday sales dropped 3.4 percent nationally.