Most of the major predictions are now in for the holiday shopping season. Here we've put together a roundup of what various trade associations and research outlets are predicting. Projections range a bit this year. Some groups are calling for a slight decline, other say sales will be flat and some say sales will show a slight uptick.
In part, the differences stem from the different way the groups look at the numbers. ICSC and Retail Forward, for example, look at same-store sales while the National Retail Federation looks at total sales. For its part, Deloitte is working off Commerce Department data. NPD bases its projection on surveys it completes. And ShopperTrak's metrics are based off its proprietary foot traffic counts. Collectively, the data gives a fairly well-rounded picture of what the experts are expecting to see for the critical season.
The bottom line is that all the groups expect the season to be stronger than 2008's disastrous holiday shopping season, but the recovery will be modest.
The association has not yet put up its Holiday Watch page for 2009. But it has released its forecast.
The ICSC expects same-store sales, or sales at stores open at least a year, for the "traditional" holiday shopping season of November and December to rise 1 percent. Same-store sales for the "new" holiday season of November though January are expected to rise 1.5 percent, it said.
A year ago, the ICSC said same-store sales in November and December fell 5.8 percent, while they dropped 5.4 percent for the November though January time frame.
National Retail Federation
The NRF looks at total sales rather than same-store sales. The association's Holiday Headquarters is up and running. The association predicts retail industry sales to decline 1 percent this year to $437.6 billion. Last year, its numbers indicated sales fell 3.4 percent.
The National Retail Federation today released its 2009 holiday forecast, projecting holiday retail industry sales to decline one percent this year to $437.6 billion.* While this number falls significantly below the ten-year average of 3.39 percent holiday season growth, the decline is not expected to be as dramatic as last year's 3.4 percent drop in holiday retail sales nor as severe as the 3.0 percent decline in annual retail industry sales expected for all of 2009.
Deloitte's predictions are that holiday sales will be flat.
Deloitte's Retail group expects total holiday sales to reach $810 billion, which would represent a zero percent change in November – January holiday sales, excluding motor vehicles and gasoline, over last year. This would be an improvement over last season's 2.4 percent decrease, the first decline in holiday sales according to Deloitte's analysis of Commerce Department data dating back to 1967.
Like ICSC, Retail Forward looks at same-store sales. The research group is forecasting flat growth—compared with a 4.5 percent decline a year ago—for the holiday fourth quarter in the key holiday retail segments combined.
In looking at some of the highlights, the group says:
- Sales at apparel and accessories channels are forecast to decline about 2% during the fourth quarter holiday period compared with a more than 9% drop last year. Most of the continued decline will be at department stores which continue to feel the brunt of a combination of economic, competitive and demographic trends.
- The broad group of mass retailers that includes discount department stores, supercenters, warehouse clubs and small-format value stores is forecast to grow sales 2.5% this holiday season. This is an increase from 2.0% a year ago.
- The homegoods channel will see sales decline more than 2% compared with a 7.4% decline last year. Consumer electronics stores will experience the biggest decline in part due to Circuit City's exit. Building and home improvement retailers will see sales declines ease to -2.0%. This channel is expected to be the first to benefit from improvements in the housing market and is forecast to see slight sales gains emerge in early 2010.
Shopper Trak, which specializes in traffic counting software, is the most recent group to offer a prediction.
The group predicted:
[T]otal holiday sales will rise 1.6 percent compared with a year ago, which would be good news for retailers compared with last year's steep decline.
The research firm also expects a 4.2 percent decline in foot traffic from last year's holidays.
Last year, holiday sales fell 5.9 percent while foot traffic dropped 15.4 percent, according to ShopperTrak estimates. The research firm tracks customer traffic at more than 45,000 stores.
The NPD Group
The NPD Group published its outlook a week ago. Its survey of 2,000 shoppers showed that 30 percent planned to spend less than last year--a four percentage point increase from the number that gave that response a year ago. A chart at the site also lists the top 10 categories consumers plan to target for gifts and how the responses compare with 2008.
“That 4 percent increase is certainly a sign of the times. On the other hand, that 4 percent is not as dramatic as it could have been.” said Marshal Cohen, chief industry analyst, The NPD Group, Inc. “I think consumers will be looking for the right gift, rather than the most extravagant or expensive one. That combined with the soft numbers we are up against from holiday last year, and I think we will see growth, albeit a modest 0.5 to 1.5 percent.”
It is the 0.5 to 1.5 percent growth that takes us â€˜back to the future' and to holidays past when growth rates of 5 percent or more were unheard of and unexpected. For Holiday 2009, not only will actual spending levels go â€˜back to the future' but the kinds of gifts being bought will â€˜go back' to more traditional holiday gift items.