Wal-Mart stocks up for a very 'ugly' Christmas

Weighed down by the election and other stresses, Americans are ready to let loose this holiday — and Wal-Mart (WMT) thinks that sending cats into space just might do the trick.

Following three solid years of sales for tacky Christmas sweaters, the world's largest retailer this season increased its selection of holiday and novelty items by 40 percent. That includes a more robust offering in ugly sweaters, featuring out-of-this-world felines and a DJ Santa spinning records.

"Customers just can't get enough of it, and the tackier the better," said Deanah Baker, a senior vice president who oversees Wal-Mart's apparel. "The more you can put on it the better it sells."

Wal-Mart shared details on its holiday merchandising strategy at an event in its Teterboro, New Jersey, store on Wednesday. Along with a focus on novelty items, the big-box retailer will be offering more exclusive items than it ever has, including a $398 Disney Princess carriage.

Despite a tough environment for clothing, which is being bogged down by deflation and disinterested consumers, Wal-Mart cited strength in its apparel business during the first half of the year. And while Baker doesn't predict the category will get any easier over the holidays, "we continue to get better," she said, speaking about the quality of Wal-Mart's product.

Wal-Mart isn't the only retailer ramping up its selection of unsightly yuletide gear. Target (TGT) on Tuesday said that it had bought enough matching holiday pajama sets to dress half a million families.

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