Consumers looking for great bargains this holiday season will not be disappointed, according to the findings of a new National Retail Federation (NRF) survey.
The NRF 2002 Holiday Consumer Intentions and Actions Survey, conducted by BIGresearch for NRF, also indicates consumers plan to spend an average of $649, an increase of 2.6% from 2001 projected spending. However, most of that money will be spent in large department stores and in search of discounts, according to the survey.
According to the NRF, the world’s largest retail trade association, this year’s research demonstrated that consumers appear to be taking a cautious approach to their holiday spending. According to the survey of 7,686 consumers, 33% of respondents plan to spend less than last year. The majority of consumers (56%) plan to spend about the same as they did in 2001.
“We will be seeing a very cautious consumer this holiday season,” said Phil Rist, vice president, Strategy for BIGresearch, a consumer market intelligence firm. “It is clear that consumers are willing to spend money, but it will ultimately be up to the retailer to give them a good reason to come out and shop.”
NRF’s holiday outlook is slightly more optimistic. Taking into account the current economic indicators, impulse purchases and additional promotional activity, NRF predicts total holiday sales will increase 4% over last year’s registered GAFS sales of $201 billion.
Consumers will be choosing their holiday shopping destinations for a variety of reasons. Forty percent of consumers say sales or price discounts are the most important factors when choosing a retailer. Selection also remains a key factor as 24% of consumers say that selection of merchandise is important when choosing where to shop.
“We will be seeing a very promotional retail environment for the holiday season,” said NRF President and CEO Tracy Mullin. “In essence, all retailers will be discounters. We believe this will provide plenty of incentive for consumers to come out and shop this holiday season.”
According to the survey, consumers appear poised to use a variety of retail formats and channels to fulfill their holiday needs. Most consumers (77%) will shop at discount department stores followed by traditional department stores (53%), Internet (46%), specialty retailers (45%), and catalog (37%).
In addition, the survey found that more than half (55%) of those surveyed say they plan to take advantage of sales or price discounts during the holiday season to make additional non-gift purchases for themselves.
“This has been a very tough selling environment for retailers due in part to our weakened economic climate and the volatile situation with Iraq,” added Mullin. “Expectations for consumer spending are down, but we feel consumers are still willing to open their wallets for a good bargain. That’s what all retailers will be offering this holiday season – really good bargains.”
Not surprisingly, this year’s survey respondents wanted to receive a wide variety of goods this holiday season. Books, CDs, DVDs and video games were the top choice (53%), followed closely by clothing and fashion accessories (51%). Gift cards and gift certificates (41%) will also be very popular this year. Other popular categories included consumer electronics or computer-related items (39%), home décor or home-related furnishings (25%) and jewelry or precious metal accessories (23%).
“It is not surprising to see these categories will be faring well this holiday season,” said Rist. “We expect pent-up demand for apparel and electronics to play a strong role during the 2002 Holiday season.”