Christmas shopping: are consumers waiting for last-minute deals?
The shopping season is in the final stretch before Christmas, but consumers appear to be procrastinating in greater numbers than recent years.
A survey released this week by the National Retail Federation (NRF) shows that the average US shopper had completed just 46.7 percent of their holiday shopping by the second week of December, the lowest since 2004. In 2008, Christmas shoppers had finished 47.1 percent of their shopping by this time on the holiday calendar.
Only 8.6 percent of shoppers reported they were finished for the year, compared with 12 percent in 2005.
Whether shoppers are waiting until the final push, or are scaling back their former shopping behavior remains to be seen. The retail sector is trying to compensate for the sluggish buying by creating last-minute incentives to get people through the door.
Overall, holiday shopping is up only slightly from last year. Research firm ShopperTrak reports that shopping was up by 1 percentage point last week compared with the same week last year. Next week will be the bellwether for this season’s economic health since about a quarter of holiday sales take place starting on “Super Saturday,” the Saturday leading up to Dec. 25, the company reports.
ShopperTrak, which tracks sales at more than 50,000 outlets, predicts that total holiday sales will increase 1.6 percent this season, up slightly from the 6 percent decline last season, the biggest drop in 40 years. Aaron Martin, spokesperson for ShopperTrak, says that while the slight uptick from last year’s bottoming out is positive news, the continued lows may represent “the new norm.”
“We’re not going to see a new turnaround for awhile. The consumer has dug in,” Mr. Martin says. The NRF, meanwhile, forecasts a 1 percent decline in holiday sales from last year.
Even if shoppers come to the stores next week, they may be purchasing on a smaller scale than they did last year. Sales of gift certificates, food, flowers, and personal-care items has risen from last year.
Also, the credit crunch is creating less of a reliance on credit cards. The NRF reports that fewer people are pulling out their credit cards than last year (30.9 percent compared with 33.8 percent in 2008), though it remains the second most-popular way to purchase holiday gifts, after debit cards.
Consumers also appear to be less impulsive in their purchases, a behavior that ShopperTrak’s Martin says is likely to outlast this season. Instead of showing up at a mall and browsing dozens of stores, consumers may target just one or two stores that they know has the item marked at the price they want.
“We have a smarter consumer who has adapted to this economy,” he says. “In the same breath, this is a consumer who wants to spend money on this holiday.”
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