2011 Holiday Retail Sales Outlook

Holiday Christmas Tree 2010Retail sales during the winter holiday season represent an indicator of economic activity and consumer sentiment. According to the National Retail Federation, average holiday spending for the weekend following Thanksgiving was up 9.1 percent, with the average holiday shopper spending $398.62. Total spending for the weekend was estimated at a record-breaking $52.4 billion. Despite the large weekend increase, overall holiday spending is projected to increase by 2.8 percent from 2010, slightly higher than the 10-year average holiday sales increase of 2.6 percent.

Each forecaster uses different methods to predict holiday sales but all of them have predicted an increase this year. The National Retail Federation (NRF) predicts an increase of 2.8 percent in holiday sales to $465.6 billion. The Deloitte & Touche Annual Holiday Survey forecasts a range 2.5 to 3.0 percent while the International Council of Shopping Centers (ICSC) forecasts a large range of 0.3 to 2.8 percent increase.

NRF’s Holiday Consumer Intentions and Actions Survey reported that consumers plan to spend a total of $704.18 nationwide, with Midwesterners averaging $680.81.

2011 National Retail Federation
Projected Midwest Holiday Spending

*The sum of the totals may be greater than 100 percent because the respondents can choose more than one answer.

Gift GivingDeloitte’s survey shows that almost half of 2011 holiday shoppers will shop online, a thirteen percent increase from 2010. This makes shopping online tied with discount stores for the number one shopping destination. Shoppers will be utilizing the internet in other ways such as checking discounts online (57 percent), reading reviews and researching gift ideas (49 percent) and going online to check family gift wishes (46 percent).

According to BIGresearch, nearly six in ten shoppers plan to make additional personal purchases to take advantage of steep discounts and sales. Shoppers will be focused on making their dollar stretch by looking for sales and special promotions. According to people surveyed in the Midwest, almost half (46 percent) indicated that the decision to shop at a particular store would be determined by price or discounts, followed by selection of merchandise (17.8 percent) and quality of merchandise (13.0 percent). Another 11.7 percent indicated everyday low prices would be the most important. Other consumers rated customer service (5.3 percent) and convenient location (4.6 percent) as most important.

Black Friday and Saturday, the first two holiday shopping days after Thanksgiving, have been dubbed thus because they represent the days when most retailers traditionally move the bottom line from red (losses) into the black (profit).

The NRF's Black Friday Weekend Survey, which covers Thursday, Friday, Saturday and projected Sunday Sales, reported that consumers nationwide spent an average of $398.62. Black Friday weekend got off to a recording breaking start with most purchases being driven by retailers' efforts to lure shoppers with aggressive discounts and opening stores as early as Thanksgiving evening. Of those who shopped on Friday, almost one-fourth were in the stores by midnight of Thanksgiving trying to get a head start as many of the retailers began sales earlier. Total sales for the weekend topped $52.4 billion, with 226 million people out shopping and visiting online retailers, up from 212 million last year.

2011 Top Black Friday Weekend Spending Categories

2011 Balck Friday Spending Chart

*The sum of the totals may be greater than 100 percent because the respondents can choose more than one answer. 

Many retailers are breathing a collective sigh of relief with the record sales for the start of the 2011 holiday shopping season. The NRF’s Black Friday Weekend Survey shows that 7.9 percent of holiday shoppers have already completed their shopping.

This year’s in-demand holiday items include the smart phones, tablets, iPad, Nintendo 3DS, Monster High Dolls, Rock Star Mickey, Lalaloopsy Dolls, Sing-A-Majigs, Leapster, and Let's Rock Elmo.

According to comScore, Inc., a company that monitors internet traffic, Black Friday online shopping totaled $816 million, up 26 percent from last year. Cyber Monday reached 1.25 billion in online spending, up 22 percent, representing the heaviest online spending day in history and second day on record to surpass the billion-dollar threshold.

Extra time to shop may also boost sales this year. The holiday retail season has 30 shopping days between Black Friday and Christmas Eve, one of the longest seasons in terms of the number of spending days.

Still, consumer sentiment toward buying, along with economic and weather conditions, will play a large role in the overall results of retail spending this year. The accuracy of the analysts' predictions will remain to be seen as the holiday season continues.

View the 2001 Actual Spending through the 2011 Holiday Season Spending Forecast prepared by the International Council of Shopping Centers (ICSC) here.

Sources: International Council of Shopping Centers, National Retail Federation, Deloitte & Touche USA LLP, and comScore, Inc.



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