Colorado Springs Retail Briefs: October 19, 2007

Shoppers will be looking for the special deals this holiday season and spending will be a bit restrained, although consumers still plan to spend more this year than last -- and that includes gifts for themselves.

According to the National Retail Federation's 2007 Holiday Consumer Intentions and Actions Survey, conducted by BIGresearch, U.S. consumers plan to spend an average of $816.69 for holiday- related shopping.

Shoppers plan to spend an additional $106.67 on "non-gift" purchases by taking advantage of special promotions and discounts to treat themselves. This brings total planned holiday-related spending to $923.36, an increase of 3.7 percent from 2006 and in line with NRF's economic forecast of 4 percent.

"Shoppers will be a little more conservative with their spending as they become more aware of the softness in the economy," said NRF President and CEO Tracy Mullin. "It is safe to say that many retailers will be competing on price, causing this holiday season to be very promotional -- a tremendous win for consumers."

While the traditional kickoff to the holiday season is Black Friday, the day after Thanksgiving, most people won't wait to begin bargain hunting. This year, 40.3 percent of shoppers said they will begin holiday shopping before Halloween.

This year, more than half (53.8 percent) of consumers want to receive a gift card or gift certificate as a holiday present, though those items won't be the only ones on shoppers' wish lists. Consumers also want everything from clothing and accessories (50.1 percent) to books, CDs, DVDs, videos and video games (50.8 percent).

Other popular categories include consumer electronics or computer- related accessories (36.4 percent), jewelry (23.8 percent) and home decor or home-related furnishings (22 percent).

Although shoppers choose to buy in stores for a variety of reasons, two major factors will be driving consumer traffic this holiday season.

The majority of shoppers continue to say that everyday low prices (12.8 percent) and sales or price discounts (38.2 percent) bring them into the stores. Though this will be a promotional holiday season, other factors, like customer service (4.9 percent), product quality (12.8 percent) and merchandise selection (22.6 percent) will help retailers drive traffic.

Additionally, 6.3 percent of shoppers said they choose to shop at stores with the most convenient location.

Modest September sales gains

While September sales gains were moderate, they were better than expected. Some categories fared well, although unusually warm weather didn't help clothing and clothing accessories retailers, whose sales increased 0.3 percent unadjusted year-over-year and decreased 0.4 percent seasonally adjusted from August.

According to the National Retail Federation, retail industry sales for September (which exclude automobiles, gas stations and restaurants) rose 2.2 percent unadjusted compared to last year and 0.2 percent seasonally adjusted compared to August.

September numbers reported by the U.S. Commerce Department show total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) increased 0.6 percent seasonally adjusted from August and 2.9 percent unadjusted year-over-year.

Wal-Mart reported a 1.5 percent increase in sales at stores open at least a year, known as same-store sales.

Limited Brands Inc. had a 4 percent drop in same-store sales, worse than the 1.5 percent decline Wall Street expected.

The Wet Seal Inc. reported same-store sales decreased 7 percent, slightly better than the 8.1 percent analysts expected. Pacific Sunwear of California Inc., another teen retailer, had a 2.7 percent gain, better than the 0.5 percent forecast.

Consumer demand for popular electronics such as cell phones and MP3 players helped boost electronics and appliance stores sales 0.9 percent seasonally adjusted compared to August and 3.4 percent unadjusted year-over-year.

September sales grew 1.7 percent on a year-over-year comparison at U.S. chain stores, according to the International Council of Shopping Center's index.

The weakness in sales at clothing stores was offset by another strong gain in auto sales, which jumped 1.2 percent during September, following a 3.3 percent increase during August.

Sales at gasoline stations also rose strongly during September, up 2 percent, following a 2.6 percent drop during August. However, this increase primarily reflected the fact that pump prices were rising last month after having declined the previous month.

Copyright 2007 Dolan Media Newswires
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