Heading into the 2010 holiday shopping season, early indicators suggested consumers were becoming more confident and willing to spend. Retail sales data, ecommerce growth, and renewed interest in luxury goods all pointed to a stronger retail environment than in previous years. At the same time, retailers were rolling out new promotions and rewards programs to attract shoppers, while consumers increasingly turned to online and mobile channels to research gifts, compare prices, and hunt for deals.
If only expectations could be made to come true, then 2010 will be a positive year for consumer spending. An influx of new consumer surveys and retailer pronouncements are pointing mostly upwards. First, MasterCard’s monthly SpendingPulse analysis suggests multiple good news fronts, most notably apparel, the long-depressed luxury category, and the more consistently-hot ecommerce category:
For the pre-season period through November 13, 2010, Total Apparel sales were up 9.7% against the same period last year. This number is an acceleration over October’s year-over-year increase of 8.2% for the category, and further builds on the 7 out of 10 months’ year-over-year gains for the sector in 2010. One should note however that the year-over-year comparisons are easier in early November compared to December for Apparel.
The SpendingPulse Luxury ex-Jewelry Index, which tallies sales at high-end restaurant, food stores, department stores and general apparel categories, was also a gainer. Through November 13, the Luxury Index was up 6.7%, in sharp contrast to the same period last year, when luxury fell by 9.2%, and again building on October’s year-over-year momentum, wherein the category was up by 4.2% year over year.
eCommerce returned to double digit gains, continuing to build on the 7%-plus gains of August, September and October, hitting an 11.4% year-over year increase.
Target indicated a positive outlook for holiday sales, and noted that consumers using its new credit card program were projected to spend 50% more at its tires over the course of a year.
The discount chain benefited from the strong performance of its credit card business in its third quarter. It said it believed that it would lure more shoppers during the holidays with a new credit card program that offers 5 percent off all purchases and a bigger array of fresh food.
So what are the likely hot items on this year’s shopping lists? Recently published analysis from Yahoo! search results provide some hints:
The survey also concludes that, on average, consumers are spending approximately $900 this holiday season on gifts for about 12 people. What are folks shopping for? Technology-related products and jewelry are showing mass appeal for the 2010 gift-giving season. For example, Yahoo! search data shows that:
Searches for “iPad gift” are spiking 800% this month on Yahoo!
“SLR digital camera”
searches on Yahoo! are up 126% this month
Searches for “Tiffany’s jewelry” are up 5,405% on Yahoo!, and searches from users seeking information on “how to buy jewelry” are off the charts, with 41% of searches from males
The results of the study also revealed that the majority of holiday shoppers are interested in offers and promotions, with free shipping being the key. In addition, the research results show that two out of three mobile phone users will use their devices while shopping this holiday season to hunt for deals, take and send pictures, and search online for comparisons while on-the-go.
Unknown, of course, is whether consumers will choose to pay now or pay later. Battered credit card receivables are hoping for the best…..
While the outlook for the 2010 holiday season appeared encouraging, much depended on whether consumer optimism translated into sustained spending. Growth in apparel, luxury goods, and ecommerce signaled improving confidence, while technology products and jewelry emerged as popular gift categories. However, questions remained about how consumers would finance these purchases and whether the momentum would continue beyond the holiday season. Retailers and card issuers alike were hoping that stronger spending trends would carry into the new year.
See source articles at:
Yahoo! Shopping Reveals 2010 Consumer Holiday Shopping Trends
SpendingPulse: Retail Sales for First Half of November Show Uptick Heading Into the Holiday Season
Target Says It Expects Better Holiday Saleshttp://www.nytimes.com/2010/11/18/business/18retail.html?_r=1&src=busln
