NEW YORK – The holiday retail landscape is changing as consumers shift more of their holiday buying to the days after Christmas.
“The whole equation has been shaken up,” said Kit Yarrow, a consumer psychologist and professor of marketing at Golden Gate University in San Francisco. “Consumers feel so much more in control. They have all the power, and they are wielding that power.”
The enormous popularity of gift cards and the growing temptation to await the best bargains until after Dec. 25 is taking the panic out of holiday buying, turning procrastination into a strategy for snaring bargains. But that approach is stressful for many retailers, forcing them to hustle fresh wares onto their floors for round two of the season.
Stores made a big effort to jump start the holiday season with advertising campaigns launched a few weeks earlier than usual. But after a solid start to the holiday season, consumers stayed away from the malls until the final days before Christmas. That had retailers pinning more hopes on the post-Christmas season.
Higher energy costs have added to consumers’ burdens, even though unemployment is relatively low and personal incomes have been rising. And a quirky calendar also played a role; Hanukkah was late, and there was an extra shopping day between Thanksgiving and Christmas.
Still, Michael Niemira, chief economist at the International Council of Shopping Centers, believes this holiday season revealed a fundamental change of shoppers lacking urgency to buy.
“The economics don’t necessarily suggest a major change in consumer spending, so I am not clear what it is,” said Niemira, noting that gasoline prices have fallen from their recent highs. “The traffic at the malls didn’t seem to be that strong. I think the retailer has to figure out how to get the customer to buy early.”
In fact, Niemira expects that this past Friday will likely be the busiest day of the holiday season in terms of traffic; previously he had predicted Saturday, Dec. 17.
Niemira still believes that retailers will meet their modest sales forecast for a 3 percent to 3.5 percent for the November-December period, based on a strong sales surge last week. The forecast is based on same-store sales or sales at stores opened at least a year.
Results from the International Council of Shopping Centers for last week will be released today.
Scott Krugman, a spokesman at the National Retail Federation, is still sticking by the association’s retail sales forecast for a 6 percent gain.
Krugman expects the week after Christmas could account for as much as 15 percent of holiday retail sales, citing an expected 6.6 percent increase in gift card sales this holiday season. Last year, the post-Christmas week accounted for 10 percent of holiday sales. In fact, many stores such as Wal-Mart Stores Inc. have seen gift card sales exceed expectations.
A better picture of how retailers fared will be known next week when retailers report their December sales results.
Niemira believes that even if more shoppers than expected redeem their gift cards over the next week or so, it would push sales only to the higher end of his forecast. Gift cards are recorded as sales when they are redeemed.
Still, plenty of retailers have a lot riding on the next few weeks. According to survey conducted by Accenture, more than half of the consumers polled said they will spend more than the value of the card.
Several big mall operators such as Taubman Centers Inc., which operates or owns 23 malls in 11 states, and Santa Monica, Calif.-based Macerich Co., which operates 80 malls nationwide, reported that traffic so far has been strong this week. But they are counting on the burst of sales to continue over the next few weeks, helping to shore up business for the fourth-quarter period.
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