It’s time for the Barataria annual Holiday Shopping Report! As we’ve done every year, the best information from those who analyze and predict the season ahead is put into one place. It’s a bit later than usual this year due to severe bizziness on my part, but it’s coming in ahead of the dreaded Black Friday.
Ready for a huge Christmas buying season? So are most retailers. But there are some important caveats.
Let’s start with the meat of it, the overall prediction. The National Retail Federation(NRF) predicts this holiday season will ring up a 3.6% gain, to $656 billion. To do that, they expect to hire 640-690k people, a very similar rate of hiring to last year’s 675k. $117 billion of this will come online, a solid 9% gain over 2015.
The total holiday season sales account for 25% of the total retail sales of $2.6 trillion for the year, and are measured over November and December. Essentially, those two months see a bump of 2/3 or so over the other months.
One feature that will continue is the long, lingering death of “Black Friday” mayhem. The tradition started back when data was hard to collect and retailers wanted to make a big splash that they could brag about at the start of the season as a prediction of how the overall take would go. That’s not necessary anymore, with real-time data, so there is little point to huge overtime costs being met with deep discounts in a solid loser of a day all around. You just don’t get anything for it.
A record number of stores are also announcing that they will be closed on Thanksgiving Day – including the entire Mall of America here in Minnesota.
The other problem with the “holiday season” is that it has already started. The entire month of November is now included in the accounted for take as consumers shop early to get ahead of the crowds. The NRF says that 40% of all shoppers started before Halloween, although these purchases account for less than 10% of the overall sales. The need for “Black Friday” has already passed into history, if not the tradition.
If you want to know everything about holiday shopping, the most comprehensive outlook comes from the annual survey of consumers put out by Price Waterhouse Coopers (PWC). There is a wealth of little tidbits in there, including:
- 72% of all consumers plan to shop locally,
- 63% of all shoppers plan to buy something for themselves, and
- Hipsters spend on average twice as much as non-hipsters, whatever that means.
It’s going to be a great year for retailers, and they have geared up appropriately. The key appears to be both value and personalization this year, so expect a lot of free initialed embroidery and other little perks if you shop early. Large consumer items like electronics will still be part of the mix, but retailers are attempting to add a lot of value with small things that make it more personal. This is a solid trend away from “value”, which is to say selling things entirely on price.
That’s how we get a solid 3.6% bump, above the 3.4% net gain of the last seven years on average.
This may not seem like a huge change over 2015, and it really isn’t. All the trends which have been in place for years are simply continuing. This is entirely consistent with a move away from the real bottom of consumer fear, launching us in to 2017 with confidence.
All of these surveys were taken before the election, of course, so there is always the possibility that things will change. It seems unlikely, however. Most people don’t really pay attention to things like politics and the economy runs on its own calendar. If there is a significant deviation, however, it’s likely to be downward and very likely to be blamed on Trumpaphobia.
What is the 2016 Holiday Shopping Forecast? Merry and bright – with a little bit of something for everyone. This will be a big help if we do indeed continue to turn the economy around and get things moving again.