The National Retail Federation is looking for sales in the final two months of the year to surpass the $600B mark, comprising a modest yet significant gain over total 2012 sales during the same period and out-pacing the sales growth rate over the past 10 years. However, the government shut down could have a strong negative effect.
The predicted total is $602.1B, a gain of 3.5% compared to last year and 0.2% better than the 10-year average holiday sales growth of 3.3%.
CEO Matthew Shay. “Overall, retailers are optimistic for the 2013 holiday season, hoping political debates over government spending and the debt ceiling do not erase any economic progress we’ve already made.”
Discussing the shutdown, Shay said, “Our forecast is also somewhat hinging on Congress and the Administration’s actions over the next 45 days; without action, we face the potential of losing the faith Americans have in their leaders, and the pursuant decrease in consumer confidence.”
The stakes for many retailers are high, with holiday sales accounting for anywhere from 20%-40%. These sales will be impacted not only by what’s going on in Washington, but also by changes in the housing market and the overall consumer appetite for big-ticket items.
“The economy continues to expand, albeit at an unspectacular pace,” said NRF Chief Economist Jack Kleinhenz. “In order for consumers to turn out this holiday season, we need to see steady improvements in income and job growth, as well as an agreement from Washington that puts the economic recovery first. Our forecast leaves room for improvement, while at the same time provides a very realistic look at the state of the American consumer and their confidence in our economy.”
Online shopping, naturally, is predicted to continue growing, by 13%-15% to about $82B. “Online and mobile continue to be a leading area of growth for retailers. In this economy savvy, cost-conscious consumers go to the web to do their research and get the best bang for their buck,” commented Shay. “In addition to researching what their peers are saying online about products and gifts this holiday season, consumers will use the buy online pick-up in store option, retailers’ apps and mobile websites to find something special for their loved ones.”
NRF also believes the nation will add between 720K-780K jobs via seasonal employment.
RBR-TVBR observation: We already have seen at least one store in our area add several aisles of holiday-related items right next to its temporary Halloween section, which to us is the perfect invitation to start pitching them.
And remember this important reality: If events do conspire to dampen holiday spending this year, the diminished spoils are going to go to the retailers who do the best job of marketing their wares in troubled times. The bold will win; the timid will not only lose, but will lose big.
Your job as broadcast sales pros is to make sure your clients are among the bold winners and survivors. In other words, if things do go sour beyond belief in Washington, use it to your advantage anyway!
