Despite continued economic uncertainty partially due to rising fuel prices, analysts at Deloitte predict that consumers will follow last year’s increase in holiday spending with yet another increase.
Deloitte believes retailers can expect an increase in the range of plus 3.5%-4% this holiday shopping season. And for non-store sales, the increase will likely be in double digits, between 15%-17%. The overall gain is not expected to be as robust as was 2011’s, however, when sales came home 5.9% to the good.
“Economic headwinds nagging consumers this fall include stubbornly high gasoline prices that continue to creep up and soft housing and job markets,” said Carl Steidtmann, Deloitte’s chief economist. “While consumers turned out in the summer to give retailers solid gains for a few months, that pace may be difficult to sustain through the end of the year. Consumers and businesses alike may pause in advance of the election; however, retailers may benefit from a post-election consumer spending boost.”
The total spend is expected to amount to $920B-$925B.
“Non-store sales continue to outpace overall growth, but increasingly influence consumers’ experience with the retail store, from trip planning, to in-store product research, and post-purchase reviews and sharing,” said Alison Paul, vice chairman, Deloitte LLP and retail & distribution sector leader. “This holiday season, retailers’ most lucrative customers may be the ones they engage across physical and virtual storefronts.”
The price of gas is actually working in the favor on non-store retail venues, notes Paul – consumers can do their shopping adding a gasoline surcharge to the endeavor.
Deloitte expects retailers are going to adjust to new realities. “This year, we anticipate retailers will come to the starting gate with true omni-channel pricing strategies, as opposed to disparate or reactionary strategies of the past,” said Paul. “Consumers should see more price transparency across mobile, online and store channels, and retailers will use these same channels to gain insights into their core customers’ behavior. Retailers that interpret and respond to real-time information about shoppers can hit the right notes on pricing and promotions that drive traffic without eroding margins.”
RBR-TVBR observation: What we like about this is that it is a gain on a gain. A more difficult set of comps was established last year and we’re on the road to beating them anyway.
It will be incumbent on broadcast sales forces to remind their clients to both make the case to visit both their brick and mortar locations as well as their virtual addresses to make sure they get their fair share of the holiday spending bounty.
