Holiday BOOST
Forecast: Sales will rise between 3.8% to 4.2%
NEW YORK — With mere hours until the official start of the holiday shopping season, the nation’s retailers are gearing up for what should be another brutally competitive shopping period.
The good news? Many retail CEOs say the U.S. consumer is financially healthy given the economy remains strong and the unemployment rate is near a 50-year low. But keeping up with shoppers’ behavior has been challenging for retailers, whether it’s the yearslong shift to shopping online or the more recent desire to rent or buy second-hand clothes and other items. Retailers also face increasing pressure from online leader Amazon.
Here are some key trends and milestones to watch:
THE FORECASTS:
The National Retail Federation forecasts that holiday sales will rise between 3.8% and 4.2% even as the ongoing U.S.-China trade war creates some uncertainty around pricing and supplies. Sales growth at the top of that range would double the disappointing 2.1% growth seen in November and December of 2018, which fell well short of the group’s prediction of 4.3 % and 4.8 %.
WHAT MAKES THIS HOLIDAY SEASON DIFFERENT?
This holiday season is the shortest since 2013 and six days shorter than the 2018 season because Thanksgiving falls on Nov. 28. Retailers say such a compressed season will put more pressure on them to make every day count. Walmart and others are trying to get into the minds of shoppers sooner, with earlier deals and advertising. This season is also different because more retailers like Walmart and Amazon are offering next-day delivery.
KEY MILESTONES FOR DATA:
Analysts will be sifting through key data throughout the season. The first big milestone comes after the five-day Thanksgiving weekend, when the NRF releases the results of its survey that offers insights into shoppers’ intentions on that first big weekend of the holiday season. The weekend, which includes Cyber Monday, isn’t necessarily a good predictor of how the whole season will go, but it can reveal some trends.
WINNERS AND LOSERS:
Heading into the official start of the holiday season, big discounters like Target and Walmart and others that have consistently won over shoppers with their low prices and expedited shipping should be among the clear winners. Off-price discounters like T.J. Maxx, which have fared well by offering customers a treasure hunt experience should also do well. Meanwhile, it’s a mixed bag regarding department stores.