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Holiday Forecasts: Partly to Mostly Merry

Written by RetailWire Staff

It's not quite as good as an unexpected gift, but the National Retail Federation (NRF), the Platt Retail Institute (PRI) and FedEx expect shoppers will be spending more during the holidays than last year. How much more is the real question.

FedEx is the most optimistic, as it expects to deliver 13 percent more shipments (280 million) during the holiday season, presumably benefitting from a solid increase in online purchases. NRF is forecasting a 4.1 percent increase and PRI is looking for a gain of 4.4 percent to 4.8 percent on top of last year's jump of 5.6 percent.

PRI says its forecast is more optimistic than others because unemployment is down vs. year ago, household net worth is up, consumer sentiment has improved, the shopping season is two days longer and the winter in the Northeast is forecast to be colder. Also, spending on big ticket items is up, indicating a return of consumer confidence.

Bloomberg News reports that the consumer sentiment index, as tracked by Reuters/University of Michigan, is at its highest level since the fall of 2007, prior to the Great Recession. Symphony IRI Group's MarketPulse Q3 study offers a somewhat contrary take with 45 percent of consumers planning to spend less this season.

According to NRF (based on a study of nearly 9,000 consumers conducted by BIGinsight), just over half say the state of the economy will affect how they spend, down about 10 points from last year. Three in ten will do more comparative shopping online and nearly half will look for sales more often. NRF's survey takers said the most important factor in where to shop is sales/discounts.

Nearly 40 percent of overall shopping will be done online and more than half of smartphone owners and almost two-thirds of those who own tablets plan to research and make holiday purchases via their devices (NRF). Shop.org is forecasting online sales gains of 12 percent versus last year.

NRF sees the lion's share of spending occurring for gifts with most of those for family. Significant spending will also occur on food, candy, greeting cards, flowers and decorations. Six in 10 shoppers will buy themselves a gift, according to NRF, with the amount spent averaging nearly $140. Younger adults spend even more on themselves. While consumers wish to receive traditional gifts like clothing, books games, etc., the most requested gift is a gift card, which is desired by six in ten.

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