Steep discounts on clothes, toys and electronics enticed shoppers to stores this weekend but they still are making fewer purchases leading into the final stretch of the holiday shopping season.

Based on early reports from analysts and malls, sales results were generally mixed to moderately down even as store traffic appeared strong this past weekend, the second-to-last of the season that can make or break many retailers.

Stores offered big discounts to shoppers who have been pulling back their spending, concerned about the recession and job stability. Shoppers came to stores for these discounts but largely stuck to their shopping lists and basic items like clothing, analysts say.

Traffic levels at stores were comparable to last year, said Marshal Cohen, chief industry analyst at market research group NPD Group. People were looking for deals but not as willing to spend their money as last year.

"The number of consumers actually making purchases were down and when they did purchase they purchased less," Cohen said.

Results were mixed across the country, with electronics still doing well and stores like warehouse-club operator Costco Wholesale Corp., he said, were mobbed.

"It wasn't as good as last year but it wasn't as doom and gloom as everyone was expecting," he said.

This Saturday was the strongest yet this season, said Karen MacDonald, a spokeswoman at mall operator Taubman Centers Inc. Traffic was up at stores throughout the country, but in terms of sales, business overall ranged from slightly above, to flat, to slightly below last year's levels, she said. Apparel was a top seller while high-end jewelry and home furnishings were weak.

Figures released Sunday by SpendingPulse pointed to more signs that shoppers are continuing their frugal ways, despite a decent Black Friday spending surge. SpendingPluse is a data service provided by MasterCard Advisors that estimates U.S. retail sales across all payment forms, including cash and checks.

From Nov. 28, the day after Thanksgiving known as "Black Friday," through Dec. 6, luxury sales dropped 34.5 percent compared to the same period last year, while overall apparel sales fell 22.9 percent. Electronic sales fell 22.3 percent.

Michael McNamara, vice president at SpendingPulse, said consumers are resisting big-ticket items priced $1,000 or more.

"Spending has obviously contracted, but the key question is will it contract even further," he said.

Online sales last week fell 1 percent to $3.81 billion from the same week last year, according to research company comScore Inc., which called the drop 'marginal.'

From Cyber Monday on Dec. 1, which marked the kickoff to the online holiday shopping season, through Friday, sales were up 3 percent to $8.26 billion from last year, the firm said Sunday. Tuesday last week marked the heaviest online spending day on record with $887 million in sales, the firm said, adding that it expects online retailers to continue offering discounts on products and expedited shipping to spur sales. It noted apparel and accessories sales were up 21 percent in the first 12 days of December, while books and magazine sales rose 18 percent.

But not all shoppers are easily parting with their money.

John Collins, an event planner who lives in Brooklyn, was at Crate & Barrel in Manhattan looking at table lamps and a fondue set. But he wasn't sure if he was going to buy anything. He said he wasn't feeling inspired to buy considering everything that's going on.

"It's not the time to spend money on lavish presents," he said. "It's time to get back to smaller, thoughtful presents, especially with an uncertain year coming up. No one I know wants to spend a fortune right now."

This season could shape up to be the worst in decades as the economy spins into recession and consumers worry about their slumping investments, rising prices and job stability.

Same-store sales are expected to be down as much as 1 percent in November and December, according to Michael P. Niemira, chief economist at the International Council of Shopping Centers.

If that holds true it would mark the weakest season since at least 1969 when the index began. The only holiday period that was almost as weak was 2002, when same-store sales rose by only 0.5 percent, Niemira said. Same-store sales are sales at stores opened at least a year and are considered a key indicator of a retailer's health.

Slumping sales are weighing on retailers. Last week they forced retailer KB Toys to file for bankruptcy protection for the second time in four years. The 86-year-old company plans to begin going-out-of business sales at its stores immediately.

With spending expected down, stores have been stepping up their discounts to try to capture whatever money consumers decide to part with.

At The Mall at Short Hills, N.J. the storefronts featured bold discount signs to lure consumers in. Chico's FAS Inc. offered shoppers up to 65 percent off, while Cole Haan offered $50 off purchases of $250 or more. Ann Taylor Stores Corp.'s Loft division slashed its clearance merchandise an additional 40 percent, making items like colorful suede shoes, originally priced at $79, now marked down to $12.88. Saks Fifth Avenue reduced its sale prices by half, for a total of up to 70 percent off.

Consumers had said all along they were going to cut their spending, stick to basics and look for deals, and they've kept their word, said C. Britt Beemer, chairman of America's Research Group. Retailers got them to come out to stores with discounts of 50, 60 even 70 percent off, but this weekend discounts didn't translate into sales.

"The malls had traffic but the stores didn't seem to be so swamped," he said.

Apparel seemed to be a big item this weekend, he said, especially for children. Many parents skipped out on back-to-school shopping this fall and are now looking for clothing deals as Christmas gifts. They'd rather cut spending on themselves before cutting spending on their kids, he said.

Toys R Us Chief Executive Jerry Storch said people still want to buy toys for their kids, and traffic was strong this weekend.

"What we've heard from the customers is that the last thing they're going to cut from their budget is a toy for their child and that's held up consistently," he said.

Michelle Acton was looking for deals when she took her children, 5 and 1, to Target in Brentwood, Tenn., near Nashville, to pick out Christmas gifts using money sent from relatives. She spent $80 on action figures and a set including a stroller and play pen for a baby doll.

Acton, a nurse, is looking for deals and spending less on gifts this year because her husband was laid off from his job in the drywall industry in February. She said the family has been pinching pennies ever since.

Lisa Cumbey, 49, of Richmond, Va., said that with her big circle of friends and large family, she's cut her spending this year. People are moving away from the need to buy things, she said at Mongrel, a gift shop in Carytown, a trendy stretch of boutiques near downtown Richmond, Va.

"Our families all agreed not to do presents, our co-workers all agreed not to do presents, so I'd say we've cut it by 80 percent," Cumbey said. "Nothing extravagant."

The ripening recession triggered by all the overspending of the last five years has left retailers with a splitting headache--and the holiday parties haven't even started yet.

While early data for last weekend was mildly encouraging, a recent National Retail Federation survey estimated that 3% more consumers are already shopped-out, versus this same time last year.
How to ease the pain? For starters, understand that discounting alone won't get you there. Sure, bargain hunters abound: The same people who recently made investments as if they were on a spree are now approaching their shopping as an investment.
"People who used to love to shop now surf the net to find the best deal," says Mike Moriarity, leader of A.T. Kearney's Consumer and Retail Practice.

Online spending at U.S. retailers on Monday jumped 15 percent over with the comparable day a year ago to $846 million, comScore said Thursday, as consumers sought out bargains in a tough economy.

The Monday after Thanksgiving was nicknamed "Cyber Monday" by the National Retail Federation to describe the surge in online spending when customers return to work after Thanksgiving and shop from their desks.

Online shopping is popular among consumers who want to compare prices for the best deal, so usage can increase in a tough economy when shoppers are paying more attention to costs.

ComScore (nasdaq: SCOR - news - people ) said a 22 percent rise in the number of buyers drove the increase, even though the average amount shoppers spent declined 5 percent. ComScore attributed the drop in dollars per buyer to each buyer completing fewer transactions.

ComScore representative Gian Fulgoni said nearly two million more consumers bought items online this year because of "extremely attractive" prices offered by retailers.

"But because of their reduced spending power, it's also evident that those who did buy were unable or unwilling to spend as much per person as we saw last year," Fulgoni said in a statement.

The most visited retail site was eBay Inc. (nasdaq: EBAY - news - people ), which recorded nearly 13 million visitors, up 45 percent from last year, followed by Amazon.com Inc. (nasdaq: AMZN - news - people ) with 9.2 million visitors.

Police were reviewing video from surveillance cameras in an attempt to identify who trampled to death a Wal-Mart worker after a crowd of post-Thanksgiving shoppers burst through the doors at a suburban store and knocked him down.

Criminal charges were possible, but identifying individual shoppers in Friday's video may prove difficult, said Detective Lt. Michael Fleming, a Nassau County police spokesman.

Other workers were trampled as they tried to rescue the man, and customers stepped over him and became irate when officials said the store was closing because of the death, police and witnesses said.

At least four other people, including a woman who was eight months pregnant, were taken to hospitals for observation or minor injuries. The store in Valley Stream on Long Island closed for several hours before reopening.

Police said about 2,000 people were gathered outside the Wal-Mart (nyse: WMT - news - people ) doors before its 5 a.m. opening at a mall about 20 miles east of Manhattan. The impatient crowd knocked the employee, identified by police as Jdimytai Damour, to the ground as he opened the doors, leaving a metal portion of the frame crumpled like an accordion.

"This crowd was out of control," Fleming said. He described the scene as "utter chaos," and said the store didn't have enough security.

Dozens of store employees trying to fight their way out to help Damour were also getting trampled by the crowd, Fleming said. Shoppers stepped over the man on the ground and streamed into the store.

Shoppers, who had snapped their wallets shut since September, turned out in force Friday to grab deals on the traditional start of the holiday shopping season, but it was clear worries about the economy tempered buying.

Preliminary reports from several major retailers including Macy's and Toys "R" Us said that crowds were at least as large as last year's, but many shoppers sounded notes of caution and concern.

Retailers extended their hours, some opening at midnight, and offered deals that were deeper and wider than the deep discounts that shoppers found throughout November.

Best Buy, which threw its doors open at 5 a.m. offered such specials as a 49-inch Panasonic plasma HDTV for $899.99 and a $189.99 GPS device by Garmin. Toys "R" Us was offering up to 60 percent discounts from 5 a.m. to 10 a.m.

But the excitement over the early morning specials proved fatal for at least one store. Police from Nassau County, N.Y. say a Wal-Mart worker died after being trampled by a throng of unruly shoppers shortly after the Long Island store opened Friday. Wal-Mart offiicals would not confirm reports of stampede, but said a "medical emergency" caused them to close the store.

Ellen Davis, a spokeswoman at the National Retail Federation, the industry's largest retail group, said that she was "not aware of any other circumstances where a retail employee has died working on the day after Thanksgiving."

Many consumers, clutching the store circulars, were focused on a few bargains Friday and said they were slashing their overall holiday budgets from a year ago as they juggle paying their rent and other bills while putting food on the table amid layoffs, tightening credit and dwindling retirement accounts.

Even for the growing number of parents who were limiting their gift buying to just their children this year, financial troubles were forcing them to be stingy.

"I have never slept here before to save a few bucks, but with the economy so bad I thought that even a few dollars helps," said Analita Garcia of Falls Church, Va., who arrived at a local Best Buy store at 7 a.m. Thursday with 10 family members. She bought a 32-inch LCD TV for $400, slashed from $500, along with an iPod and several DVDs.

"This year a lot of people I know won't be getting Christmas presents. I have to pay the rent and bills, and I have two little ones at home to think of," Garcia added.

At the Best Buy store in Syracuse, N.Y., a line snaked past stores and around walkways on the second floor of Carousel Center a few moments before the store's 5 a.m. opening -- about eight hours after some people near the front of the line had arrived. Rob Schoeneck, the mall's manager, estimated about 1,000 people were waiting for the electronics store to open and said the crowd was about the same size as a year ago.

Inside, Kira Carinci, 33, a teacher from Cicero, N.Y., searched for the $80 "Guitar Hero III: Legends of Rock" video game and guitar controller bundle for her son but said she is more concerned about money than she was last holiday season. She said she had set aside a certain amount for Christmas spending.

"I don't usually save, so this year is a little different," she said.

By 3:43 a.m., about 50 people had lined up in preparation for the 5 a.m. opening at a Wal-Mart store in Cary, N.C. Shannon Keane, 38, of Cary, who arrived with her son, Miles, 13, at midnight, said she was buying only one item today: an iPod for her son.

"He really wanted this one thing," Keane said. "So we're here for this one thing."

Keane, who was recently laid off from her job at an insurance company, said she was on a budget this year because her unemployment checks were also helping support family in Colorado.

"I really can't focus on gifts," she said. "I have to focus more on helping them pay their bills. It's hard," she said of being a single mom on a small income. "I've always filled the tree. But you have to be honest. This year, I'll do the best I can."

Joyce and Kevin Kirk of Georgetown in southwest Ohio, who arrived at Kohl's at Eastgate Mall in suburban Cincinnati, at 4 a.m Friday, bought toys for the baby and clothing for her older children, mostly at 50 percent to 60 percent off.

She said they decided to focus more on the kids this year and cut down on gifts for other people. Her husband, a construction worker, wasn't getting enough work at his company and recently switched to another company.

"We just can't do as much this year because of the economy," said Joyce Kirk, who aims to cut her holiday budget to $1,000. She usually spent $3,000 to $4,000 on Christmas gifts

Black Friday received its name because it historically was the day when a surge of shoppers helped stores break into profitability for the full year. But this year, with rampant promotions of up to 70 percent throughout the month including even at luxury stores like Saks Fifth Avenue amid a deteriorating economy, the power of this landmark day for the retail industry could be fading.

Still, while it isn't a predictor of holiday sales, the day after Thanksgiving is an important barometer of people's willingness to spend for the rest of the season. And particularly this year, analysts will dissect how the economy is shaping buying habits in a season that many analysts predict could see a contraction in spending from a year ago.

Last year, the Thanksgiving shopping weekend of Friday through Sunday accounted for about 10 percent of overall holiday sales, according to ShopperTrak RCT Corp.

The group hasn't released estimates for Black Friday sales this year, but experts believe it will remain one of the season's biggest selling days, even as shoppers remain deliberate in their spending.

"This is definitely a hit-and-run mentality," said C. Britt Beemer, chairman of America's Research Group. "They are running in, grabbing the deal and running out. This is what I am seeing this morning."

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AP Retail Writer Ashley M. Heher in Chicago; AP Technology Writer Rachel Metz in Syracuse, N.Y.; and Associated Press Writers Barbara Rodriguez in Raleigh, N.C.; Kelly P. Kissel in Lake Charles, La.; Lisa Cornwell in Cincinnati; Tamara Lush in Pembroke, Pines, Fla., and Jacquelyn Martin in Falls Church, Va. and Colleen Long in New York, contributed to this report.

NEW YORK (CNNMoney.com) -- Cash strapped Christmas shoppers will have a tighter hold on their pocketbooks this holiday season, according to a national consumer survey released Friday.

U.S. households intend to spend an average of $418 on presents this year, down from $471 last year, according to a survey of 5,000 U.S. households from consumer research firm The Conference Board.

A lot of consumers just don't have the cash to spend said Scott Hoyt, senior director of consumer economics at Moody's Economy.com.

"Even the consumers who have the money aren't keen on letting go of it," said Hoyt.

"Everyone is telling me not to spend any money on them, because they don't have any money, so I am trying not to go out buying a bunch of expensive gifts for people not planning on buying me expensive gifts," Said Miriam Woodall, a shopper from Birmingham, Alabama visiting Atlanta on Friday.

Over the past several months, the economy has been slammed by tightened lending, trouble in the banking sector, and volatile commodity prices, in a type of crisis that Treasury Secretary Henry Paulson said occurs only "once or twice" every century.

The specter of unemployment casts a long shadow going into Thanksgiving week, millions of Americans have already lost their jobs, and a possible bankruptcy of The Big Three automakers threatens millions more, according to economists.

The number of people seeking unemployment insurance for the first time surged to a 16-year high last week, according to a government report.

"Obviously [consumers] don't want to cancel Christmas, but I think they're going to be a little more budget conscious this time around," said Lynn Franco, director of The Conference Board's Consumer Research Center.

"Because of the economy the way it is today, I don't have the money I once had last year, so unfortunately I am spending less," said Victor Ross, a shopper from Elgin, Illinois.

Retail store traffic - the number of people going into stores - this year is expected to fall by 9.9%, according to a retail industry survey.

"It's going to take more than the usual discounts and incentives from retailers to get consumers to spend more freely," added Franco in a statement.

The slow holiday season has prompted many retailers to offer discounts early, before "Black Friday," the Friday after Thanksgiving traditionally viewed as the nation's largest shopping day.

Wal-Mart (WMT, Fortune 500), the world's largest retailer, announced a series of price discounts several weeks ago, with emphasis on electronics, and extended its free shipping program by a week to December 17th.

It's a retail environment that Brad Anderson, chief executive of Best Buy (BBY, Fortune 500), the nation's largest electronics retailer, called "the most difficult climate we've ever seen."

Just a week ago, one of Best Buy's main competitors, Circuit City, applied for federal bankruptcy protection.

The number of households who said they intended to spend more than $500 on gifts this year fell to 27%, down from a third last year.

About 39% of consumers said they would shop online for bargains this year, according to the survey, with books topping the list of online gift choices.

The percentage of people shopping online is expected to remain relatively unchanged from last year, according to Franco, but online retailers are still expected to work just as hard as their brick and mortar cousins to attract buyers this year, offering shipping incentives and discounts.