Our economy has been ill. Jobs are hard to find and most of us don’t have the extra money to spend on frivolous or unnecessary gifts. Retailers need us to spend to help the economy, but we are hesitant. Will America shell out the bucks for Christmas this year?
The answer isn’t a simple one. It seems that every agency or expert has an opinion and none are in agreement. The National Retail Federation (NRF) predicts that sales will increase 4.1%, this year, increasing overall sales to $616.9 billion. This would be the first significant gain in three years. This figure is based on improved job availability and improvements being made in housing situations. Still, shoppers will likely be cautious about holiday spending.
While minor improvements are being made, the air of restraint is all around. People are uneasy and are going to be very careful when making their spending decisions for the holidays. This means a lot of price-shopping, watching for online deals, stores that price-match, and scrutinizing sale flyers.
Many physical stores are connecting to online shoppers with the “purchase online and pick up in store” strategy. The shopping is done on the web site, but the shopper needs to go into the store, where they will hopefully make more purchases, to pick it up.
NRF Chief Economist Jack Kleinhenz says that, “In the grand scheme of things, consumers are in a much better place than they were this time last year, and the extra spending power could very well translate into solid holiday sales growth for retailers; however, shoppers will still be deliberate with their purchases, while hunting for hard-to-pass-up bargains.”
Shoppers search for bargains and retailers work to provide them. Both sides are uneasy. Consumers want to provide the best gifts for those on their holiday list and retailers want to increase sales after an iffy start to 2014 and a relatively show summer season.
A Gallup poll confirms the NRF prediction. Their figures from a mid-October poll predict average American spending at $781, the highest since 2007.
PricewaterhouseCoopers (PwC) says that shoppers will be of two distinct groups: survivalists and selectionists. Survivalists are those making less than $50K per year and make up 67% of shoppers in America. The selectionists make more than 50K per year, 33% of the American shoppers. Survivalists will spend very frugally. Selectionists will be careful with their disposable income, but will spend significantly more than survivalists.
PwC also predicts an increase in preplanning online prior to shopping to prevent impulse purchases and decrease time spent looking for the best deal.
As retailers cross their fingers and hope for a rosy outcome for holiday shopping, is anyone thinking about the actual holiday? Perhaps gathering with family to share a meal, visit, listen to holiday music or play music together is the real gift. Not that any of us mind opening a few presents, but we should remember that the holiday season isn’t all about shopping and dollar signs. It’s about family. Now if you’ll excuse me, I haven’t finished buying my gifts yet.