Great expectations? Retailers do what it takes to have a holly, jolly season
This article first appeared in the St. Louis Beacon, Nov. 24, 2010 - Holiday shopping NOW. No waiting.
That's been the message for weeks, as the nation's retailers extended their holiday growing season. Since October, when Christmas trees sprouted next to jack-o'-lanterns in store aisles, pre-holiday sales have jumped the gun on the day after Thanksgiving -- Black Friday -- the traditional start of the shopping season.
Local Kohl's stores were open until midnight last weekend, offering a host of pre-Thanksgiving deals. And Kmarts and Walgreens are no longer the only outlets for T-Day shoppers craving a side of bargains to go with their turkey and mashed potatoes. Walmart supercenters are open 24/7, including Thanksgiving. Sears has announced that its stores will be open from 7 a.m. until noon on Thanksgiving morning, and Toys "R" Us will open at 10 that night.
Retailers whose brick stores will be closed on the holiday will be open for business online. Click. Click.
Who wants to watch holiday parades and football, anyway?
"Surveys indicate that there will be a slight increase in sales this year," said Haim Mano, an associate professor of marketing at the University of Missouri St. Louis.
And he adds this: "I think they will consider any increase a celebration."
Mano, who studies consumer behavior, notes that in addition to a growing emphasis on internet shopping and social networking sales tools, retailers have turned to the tried-and-true: layaway, low- or no-interest installment plans -- and because we all love a bargain -- marking up the original prices on items so they can be immediately discounted.
"Keep in mind that the retailers -- our 'good friends' -- are trying an awful lot to make us go into the store or go online to buy. They're going to have sales. They're going to have promotions. They're going to 'Tweet,' " Mano said.
"And Christmas starts in July. I'm joking -- it's August," he said.
Shoppers Cautious but More Willing to Spend
With the national unemployment rate stuck at 9.6 percent and the down-in-the-dumps housing market still dealing with a projected 3 million foreclosures this year, holiday shopping remains a hard sell for retailers. But if consumer surveys are to be believed, cautious Americans will spend as much or more this holiday season as they did last year.
According to a joint national poll conducted earlier this month by the Credit Union National Association and Consumer Federation of America:
- 57 percent of Americans surveyed said they would spend the same or more this year, while 41 percent said they would spend less than 2009.
- 23 percent acknowledged that they felt better about their overall financial situation this year.
The 25th annual holiday survey by the accounting and financial firm Deloitte also suggested that Americans plan to spend more this year, even though half of those polled felt that the U.S. economy is either in a recession or heading back to one. The survey, conducted between Sept. 23 and Oct. 10, found that:
- 62 percent planned to spend the same or more this season -- an increase of 11 percent over 2009's holiday survey and the highest level since 2006.
- Overall, consumers plan to spend about $466 on gifts, the first increase since 2004.
But there are also signs that American consumers have seen the light about avoiding debt and saving for a rainy day: Almost half (46 percent) of those surveyed by Deloitte said they would pay cash for more gifts than they have in the past, and 36 percent said they have permanently cut back the amount of money they spend.
Deloitte expects total holiday sales to reach $852 billion this season. That would be a 2 percent increase over last season in holiday sales from November through January, excluding motor vehicles and gasoline.
'People Will Spend'
Mano said that unemployment remains a major hindrance, but consumer confidence is beginning to grow among those Americans who are employed. He expects that this year's holidays sales will be slightly improved over 2009, but still not at the levels of 2006 or even 2007.
"We're not rebounding in any way yet, but consumers are getting more confidence," Mano (right) said. "People will spend. The question is whether they are going to spend more or less. The people who are very strongly influenced by the downturn are not going to spend as much. The rest of the population is likely to want to go out and spend a little more. On average, we're going to see a very small increase."
He said that we've become a nation of bargain-hunters, and he expects to see higher sales at stores that appeal to thriftiness: Walmart, Target and discount clothing stores, such as T.J. Maxx and Marshalls. Struggling retailers, such as Circuit City, were already shaken out of the market.
He believes that more affluent Americans are returning to their spending ways, though middle-class consumers will still think twice before buying high-ticket items, such as big-screen TVs and electronic gadgetry. Make that some electronic gadgetry: We might not be replacing that refrigerator this year, but, oh, how we love our smart phones.
Mano said it is going to take some time before Americans return to their pre-recession shopping habits, but he doesn't believe it will take years and years.
"I am not a prognosticator. I can't predict what will happen," he said. "But we are still a nation of immediate gratification-seeking people. People who can do this, will."'
Who's Shopping This Holiday Season?
American consumers plan to spend a little more this year, even though they are less confident about the economy, according to the 25th holiday survey by the accounting and financial services firm Deloitte. Overall, they plan to spend about $466 on gifts, the first increase since 2004.
Here are more findings:
* 66 percent of consumers in the survey said their financial situation is the same or better than last year. On the other hand, half felt the economy is either in a recession or heading back to one.
* 62 percent planned to spend the same or more this season -- an increase of 11 percent over 2009's holiday survey and the highest level since 2006.
* Consumers making $100,000 or more a year were the most positive, with nearly 45 percent believing that the economy will improve in 2011. This group planned to spend about $826 on gifts.
* Almost half (46 percent) said they would pay cash for more gifts than they have in the past.
* 36 percent said they have permanently cut back the amount of money they spend.
* 73 percent said they plan to change the way they shop this season in an effort to save money.
Deloitte started its annual holiday survey in 1985 to gauge consumer expectations, the economic climate and related spending and purchase patterns. This year's survey of 12,418 consumers was conducted online between Sept. 29 and Oct. 10. To read the entire survey, click here.