Like next year’s calendars, we start receiving holiday outlooks right about mid to late October. Any number of banks, credit card companies, investment analysts, industry organizations and even retailers themselves distribute crystal ball predictions: Who will buy? What will be bought? How much?
This year is no different in many ways, though superstorm Sandy (which ruined Halloween up and down the East Coast) put a crimp in some forecasts, as residents in hard-hit area will remain focused on recovering their lives, rather than thinking about Black Friday, Small Business Saturday, Cyber Monday or Green Tuesday.
“Our research shows that Sandy clearly depressed the start to the early holiday season with the storm significantly impacting the year-over-year growth rates in key holiday categories over the first week of November,” wrote Michael McNamara, global solutions leader at MasterCard SpendingPulse.
There are signs of post-storm recovery in the affected regions, McNamara continues, but “2012 is likely to be a more traditional season that kicks off closer to Black Friday and sprints its way to December 24.”
Overall, consumers are signaling that they intend to spend a little more this holiday season, according to the 2012 Holiday Spending Intentions Survey conducted jointly by the International Council of Shopping Centers and Goldman Sachs. This overview, published on Nov. 14, reports that nearly a quarter of consumers questioned plan to spend more (19%) or substantially more (5%) on holiday gifts this year. According to researchers here, this is the highest percentage of consumers reporting they intend to increase spending over the previous holiday season since ICSC began asking the question in 2004.
There are a total of 32 shopping days between the holidays of Thanksgiving and Christmas this year, slightly more than usual, given that Tday falls on Nov. 22. Even so, thee’s little change in the types of gifts planned for purchase, according to ICSC. The top three holiday-gift items for 2012 are gift cards (21.3%), apparel (14.1%) and toys and games (14.1%).
The one good thing about gift cards, notes the study, is that they have the power to extend the holiday season into January as their recipients hit the stores in the post-Christmas period.
For food retailers and wellness-related products, the outlook seems to be following the larger “spend more” trend. Technology tracker Inmar finds that nearly 80% of the 500 shoppers they queried say they plan to spend as much or more on food and holiday meals this year as they spent last year during the same period. However, coupons will be important, with 75% stating they’ll be looking for coupons or promotions on the food products they want — and they’ll be using more digital media to track down deals than in prior years.
“Shoppers are realistic. They may have bigger expenses, may have less income, but they want the holiday season to be special,” says John Ross, president of Inmar Analytics. “Increasingly they are turning to technology like their mobile phone to help them keep the season bright.”
One interesting point retailers should seriously consider: Inmar finds that the grocery channel has yet to find any meaningful way of participating in the bounty of Black Friday and Cyber Monday. Yet 61% said they would be interested if food retailers offered Black Friday or Cyber Monday deals.
Now, we all know that a good many wellness retailers and manufacturers are small businesses. The MasterCard survey does find a hiccup in their holiday performance of late. The poll found that spending at small retailers in October slowed to an increase of 4.2% year over year, down from a rate of 5.8% in September. The growth rate fell even further (to 3.6%)
The bright spot going into the holidays is that smaller retailers have had a pretty good year overall. On a year-to-date basis, the sales growth rate excluding auto for small retailers is 7.4% from January through October 2012, compared with a 5.6% growth rate for retail overall during the same time period.
It’s been a bumpy road for smaller operators, but they remain competitive and have plenty of opportunities to boost sales numbers before the end of the year. Here we go!