"It's well-known that at least half of the shopping that occurs during the holiday season happens during the last few weeks, making the final stretch of utmost importance to retailers," said NRF President and CEO Matthew Shay. "With the big day falling on a Saturday this year and a lot of shopping left to be done, retailers will continue to push aggressive promotions in the weekdays leading up to it, hoping to remind shoppers they only have one more weekend to shop."
According to the survey, 37 million people (16.9%) had not even started their shopping as of late last week, lower than the estimated 42 million people who said so during same point last year. Additionally, 22 million go-getters (10.1%) say they have already finished, up from 8.6 percent who had finished by this time last year. Though they started the season with a bang, men admit to having completed slightly less than women at this point (48.5% vs. 50.4% respectively).
It seems many shoppers are well aware they only have one big weekend left to shop. According to the survey, most holiday shoppers (32.4%) plan to complete their list prior to Saturday, December 18. Though, Friday, December 24 (11.9%) is expected to be the second busiest day between the 18th and Christmas Day.
Of the people who say they have used their smartphone to shop this holiday season, more than one-quarter (26.0%) have used the phone to make an actual purchase. Nearly one-third (32.5%) are specifically using their phone to receive text messages with special offers and 34.6 percent are reading what their peers are saying in customer reviews. It seems locating store hours or locations (50.7%) and perusing their options by browsing for gifts (60.2%) are the most popular ways shoppers have used their phones thus far.
"Just as we saw with the emergence of Internet shopping, mobile shopping, too, is already starting to catch on in terms of being a generator of sales for retailers," said Phil Rist, Executive Vice President, Strategic Initiatives, BIGresearch. "Tracking down mobile coupons and reading customer reviews remain extremely popular options for shoppers as they look for the best price, product and even store location."
Department stores can expect the larger share of traffic over the next few weeks (38.4%), though online retailers (37.6%) and discount stores (36.5%) will also be popular shopping destinations for last-minute shoppers. Electronics stores (19.4%), clothing or accessories stores (18.8%) and outlet stores (10.8%) will also see their share of procrastinators in the coming days.
When it comes to gifts that have been bought so far, most say they have purchased clothes or clothing accessories (43.9%). Though books, CDs, DVDs, videos or video games (38.1%) have also been popular purchases. Consumers also bought toys (35.3%), gift cards (29.9%), consumer electronics (21.3%), food or candy (20.0%), and home décor (15.2%).
When asked which payment method they have used the most, four out of ten (40.9%) have used their debit or check cards most often. Nearly one-third (31.1%) have used their credit cards and nearly one-quarter (24.4%) have used cash. A mere 3.6 percent have relied on checks.
Christmas Day itself will largely serve as a day for consumers to cook (45.6%), visit friends and family (66.0%) and watch TV (52.8%), but nearly one-quarter (24.1%) will browse the Internet as well. NRF has revised its holiday sales forecast to 3.3 percent, or $451.5 billion, up from the original 2.3 percent expected increase.
(Source: National Retail Federation, 12/15/10)
In the study -- based on responses from 123,601 new-vehicle buyers and lessees, of which 81,350 replaced a vehicle that was previously acquired new -- Ford and Honda rank highest in a tie among automotive brands in retaining vehicle owners, with each retaining 62%.
Fielded between February and May, and August and October this year, the study measures the reasons for -- and the rate at which -- automotive brands retain their existing customers and gain them from competitors. For the latter, importance of a fun-to-drive and styling have also gotten more important among the reasons customers are switching to a different brand.
Raffi Festekjian, director of automotive product research at J.D. Power, says as the economy improves, consumers are responding more to emotional -- versus purely practical -- reasons for staying with their vehicle brand or switching to a different one. "We are seeing more emotional characteristics creep in," he says. "Ford is pleasing their current buyer base, producing models that resonate well. We had our Initial Quality Study in June, and in that Ford specifically ranked the highest they have ever ranked. So they are continuing to have good news with products that connect with consumers."
He says the fact that emotional factors are driving loyalty and conquest partly reflects the fact that big differences in vehicle quality and fit and finish no longer exist. "Good quality is a price of entry now."
The study finds that the importance of fun-to-drive vehicles as a reason for owner loyalty has increased by eight percentage points in 2010, compared with 2009. Meanwhile, the importance of resale value as a reason to stay loyal has decreased by 10 percentage points from 2009.
The firm says Ford's retention rate is primarily driven by the Edge, F-Series and Fusion models -- while for Honda, retention is driven by the Accord, CR-V and Pilot.
The study says Ford has an edge on fun, as owners are more likely than Honda owners to say they have remained with their brand due to the perception that their new vehicle is fun to drive or has good styling, per J.D. Power. Honda owners are more likely than Ford owners to cite resale value and safety as reasons for repurchasing the brand.
Hyundai, Lexus and Toyota are tied for third place, each getting 60% of customers to stick with the brands. The biggest improvement is from Kia, improving 21 percentage points from last year to 58% in 2010.
The firm says that this year 16 of the 34 ranked brands have improved their customer retention rates versus last year, while 14 have declined and four have remained flat. Across the industry, the rate at which customers are staying loyal to car brands hasn't changed from 2009; 48% of U.S. car and truck buyers are loyal, per the firm. Domestics are doing better at keeping their customers: this year, according to the study, 69% of owners who traded in a vehicle from a domestic brand purchased another domestic vehicle, compared with 68% last year.
According to the companies' research, which involved a nine-question survey sent to more than 700 U.S. households, 11% of consumers said they planned to use reward points or miles to augment their holiday spending this year. Of that group, 70% said they would use those points on purchases for other people, rather than for themselves.
According to the survey, more than 70% of consumers said they were occasional or frequent users of rewards programs. Of those users, 8.1% of them said they planned on spending more on holiday purchases this year, compared with 6.6% of the total respondents.
"Retailers who use data from their reward programs to respond to customers' most pressing concerns at critical times like the holiday gift giving season can enhance the shopper experience and leverage relationships in a way that deepens loyalty to their store or their brand," said Epsilon Loyalty Solutions Vice President John Bartold, in a statement.
Meanwhile, a separate survey found that Canadians are much more likely to use rewards programs than Americans. According to the Air Miles and American Express Holiday Rewards survey, 91% of Canadians use rewards programs, compared with 72% of Americans. Eighteen percent of Canadians said they plan to use those programs for holiday purchases, compared with 8% of Americans.
Americans, on the other hand, are more likely to shop online than Canadians, at a rate of 73% vs. 44% for general sites. However, when the online shopping involves a loyalty or rewards site, Canadians are three times more likely to shop online.
Few companies were clobbered harder than Starbucks in the recession. The coffee chain with outposts on every corner came to represent all that was wrong with American businesses and shoppers: unchecked expansion, self-indulgence and mindless credit-card swiping.
But now customers who swore off frivolous spending during the recession are lining up again for their $4 caffeine fix. The company's net income nearly doubled and revenue rose 17 percent in the most recent quarter compared with a year earlier, as more Americans allowed themselves a small treat.
After seeing their retirement funds and home equity shrink severely, consumers tightened their belts in a shift some economists dubbed the New Frugality. Fortunately for the world's largest latte purveyor and other peddlers of small luxuries, Americans have a short memory when it comes to the economy.
Affordable luxury goods like gourmet coffee, lingerie and high-end skin cream have been enjoying a comeback since the stock market began to rally in August and higher-income Americans started feeling better about their finances.
At Estee Lauder Cos., whose brands include Clinique and MAC cosmetics, CEO Fabrizio Freda says customers who traded down to drug store brands when times were tough are returning. Revenue was up 14 percent last quarter, driven by brisk sales of high-end moisturizers and eye creams.
Specialty items like the "Miraculous" push-up bra have buoyed the company that owns Victoria's Secret and Bath and Body Works. Revenue rose 12 percent last quarter at Limited Brands Inc. as shoppers treated themselves to its stock in trade.
"People didn't feel good about having little indulgences" in recent years, says David Palmer, an analyst with UBS Investment Research. "The Suze Orman-type talk shows were telling you to kick your Starbucks habit."
Now, he says, austerity fatigue may be setting in.
For Michele Burkhammer, a nurse clinician for the Montgomery County Fire and Rescue Service in Rockville, Md., austerity was the only option after she was furloughed and her husband lost his job. She started buying groceries at Walmart and pared her list to the essentials.
These days, her husband is back to work, and she's fed up with pinching pennies. She still doesn't splurge on herself, but she recently bought Ralph Lauren khakis and other high-end items for her 3-year-old son. She's also returning to upscale and organic grocers.
"Shopping is starting to be enjoyable again," Burkhammer says.
Trading back up has raised hopes for the holiday season. Research firm ShopperTrak bumped up its holiday sales growth forecast to 3.2 percent from 2.9 percent after a solid start in November.
The recession technically ended in June 2009, but the recovery has been fitful. Manufacturing has been stronger, though hiring has not. Home prices have stabilized somewhat since bottoming out in the spring of 2009. A 17 percent gain in the Standard & Poor's 500 stock index since the end of August has helped raise consumer confidence, and with it spending, particularly among the upper class.
"When people feel their household wealth rising, they're more confident and that has a dramatic impact on consumption," says Chris Christopher, an economist with IHS Global Insight.
Still, it's unclear whether this signals the beginning of a broader retreat from thrift. Shoppers still are making lists and, for the most part, sticking to them. The unemployment rate rose to 9.8 percent in November, holding a damper on spending in millions of households.
Frank Mangini, who lives in the Queens borough of New York, is back to making regular trips to Whole Foods, but only for specialty items he can't find at his local supermarket.
"I was trying to lay off a little bit" during the recession, he says. Even with the economy picking up, he says he's "trying not to overdo it." But he's happy to shell out for his favorite organic green tea.
After taking a drubbing during the recession, Whole Foods Market Inc. has been luring back shoppers. Revenue rose 15 percent last quarter. The company, the biggest national seller of organic and natural groceries, says shoppers are buying more higher-priced brands and trading up on pricey items like seafood, cheese and housewares.
"Middle-class people want to make these little splurges on basic luxuries like Victoria's Secret so that they're not breaking the bank or the wallet but are getting out of the doldrums of the recession," said Sherif Mityas, a partner in the retail consultancy firm A.T. Kearney.
These small splurges are unlikely to spark a broader recovery. After all, Starbucks or Whole Foods binges set shoppers back just a few extra dollars.
You'd have to see sales of bigger-ticket items like automobiles, designer handbags and extravagant vacations rebounding -- and see people racking up credit-card debt again -- to say Americans' frugality has ended, says Kenneth Goldstein, an economist at the Conference Board. And that's unlikely as long as unemployment remains stuck above 9 percent. Even with car sales improving, the industry will sell 4 million fewer cars in the U.S. than it did in 2007.
Alan Levenson, chief economist at T. Rowe Price, says Americans couldn't revert to old spending patterns even if they wanted to because banks aren't willing to lend. The personal savings rate remains high, and although consumer spending rose an annualized 2.8 percent in the third quarter, the biggest bump since 2006, that's not enough to rev up the overall economy.
Certainly there's pent-up demand, Levenson says, but shoppers are "not blowing anybody's doors off."
(Source: The Associated Press, 12/09/10)
Arbitron Inc.'s RADAR 107 National Radio Listening Report, which was released yesterday, shows an increase of 3.3 million radio listeners age twelve and older per week, versus the December 2009 report. The number of persons twelve and older listening to radio each week now reaches an estimated 239.8 million -- 93.2 percent of all Americans twelve and older.
In addition to persons twelve and older, radio listening increased year-over-year across major demographic groups, with adults aged 18 to 34 showing the biggest gains. The number of adults aged 18 to 34 who are weekly radio listeners increased nearly 960,000 in the past year, and adults aged 25 to 54 gained more than 750,000 in the same period. Meanwhile, teens aged 12 to 17 continue to embrace radio broadcasts with an average weekly increase of 365,000 versus last year's report.
Despite the proliferation of competing media platforms, radio continues to reach just about everyone on a regular basis. RADAR 107 indicates that, over the course of a week, radio is listened to by over 92 percent of all teens aged 12 to 17, 94 percent of adults aged 18 to 34, and 95 percent of adults in the 18 to 49 and 25 to 54 age brackets.
Hovering like a beacon at the culmination of the season is the Super Bowl, the single biggest party event of the year. Over 43 million Americans participate in Super Bowl parties each year, with host families spending $70 on average -- second only to Thanksgiving.
As the pre-game drive period approaches, here are some important merchandising and promotional ideas for the retail playbook.
2011 Super Bowl Playbook
1. The game day crowd is converging on the couch...and Mom makes the calls!
According to Nielsen, nine out of 10 U.S. households will be watching Super Bowl XLIV at home, or at a friend's or relative's house -- instead of at a restaurant or bar. In making it all happen, Mom makes 69 percent of all Super Bowl-related purchase decisions and, according to research, loves the highly social, shared-viewing experience of the NFL.
2. Partnering with brands gets game time favorites onto shopping lists and into baskets to help maximize the retailer's sell-in period.
Brands such as Campbell are putting substantial resources behind game time favorites. The company spotlights Chunky Soups, Pace Salsa and Pepperidge Farm Goldfish Snacks as its game time "power brands." There will be full Path to Purchase shopper marketing coverage for all three brand portfolios.
3. Think tailgating in the kitchen.
Event-related cooking culture is on fire in America. Tailgaters will be bringing it indoors and looking for smoking hot recipe recommendations -- anything with "chili", "picante", "buffalo", "nacho" or "salsa" in the name will do. Retailers should broadcast recipes in e-newsletters and rotos. A single irresistible appetizer idea can influence an entire shopping trip decision.
4. Kick-off the excitement in-store.
Look to major brands from Campbell for great game time-themed display materials that will not only build incremental sales excitement for those particular products but remind shoppers to stock up on all the game day items they'll need. During the critical weeks in January, retailers that have the space should consider constructing a game time alcove of modular displays to interrupt usual shopping patterns.
(Source: Retail Wire, 12/09/10)
Consumers are adding a very important name back to their holiday shopping lists this year: their own.
The percentage of shoppers who say they plan to indulge in a little something extra for themselves has risen four points since last year to more than 57 percent -- the biggest jump in at least six years, according to an industry survey. Sales of jewelry, apparel and consumer electronics are up so far this holiday season from last year, and experts attribute part of the boost to what has become known as "self-gifting."
You didn't think Dad was going to give that 50-inch flat-panel TV to someone else, did you?
"The consumer really is sitting there saying, 'I'm going to take advantage of these deals,' " said Marshal Cohen, senior analyst for NPD Group, a consumer research firm. "This consumer is saying that there really is some pent-up demand."
During the nation's economic downturn, consumers saved money by whittling down their Christmas lists. Spending on gifts for babysitters, co-workers and teachers were slashed, and, in the ultimate act of self-sacrifice, shoppers cut back on themselves.
According to the National Retail Federation, the number of self-gifting shoppers began to fall in 2007 -- the year the recession began -- after steadily increasing for several holiday seasons. Though the number ticked up in 2008, it plunged last year to under 53 percent of shoppers. The amount they intended to spend last year also fell nearly 5 percent to $101.37.
This year, both measures have rebounded along with consumer confidence. And shoppers reported plans to spend an average of $107.50 this Christmas on themselves, the NRF said.
"The economy is picking up a little bit," said Lisa Bennett, as she sipped a Bellini on a recent evening at a cocktail party at Bliss Spa in downtown Washington, D.C. for its top customers.
Bennett said the sense that the recovery is on track made her feel a little less guilty about spending $200 online at Ann Taylor for herself while she was scouring the Internet for gifts for her teen cousins. They got Best Buy gift certificates and J. Crew sweaters; she got two new tops and a dress and then booked an oxygen facial for herself at the spa.
General manager Michelle Caron said customers are not only booking "maintenance" appointments -- the manicures and waxing counted as necessities among some women -- but also reserving more indulgent services such as facials and massages. This holiday, the spa launched a new service dubbed Shopper's Delight, a lower leg massage and exfoliating treatment for $70.
"We've only been getting busier and busier," Caron said.
Industry experts say the return of self-gifting is a telling indicator of consumer health. Over the past two years, as consumers have grappled with high unemployment, falling home prices and a volatile stock market, spending was primarily driven by necessity. Retailers that sold staples such as groceries held up better during the recession than those that stocked discretionary items.
But if shoppers are now willing to buy for themselves, that could mean the big freeze on consumer spending is starting to thaw.
Cohen said self-gifting helped drive the strong sales and shopper traffic over the post-Thanksgiving weekend. His research showed 35 percent of shoppers bought something for themselves, more than he expected.
Self-gifting could also prove lucrative for retailers because it rarely occurs by itself, Cohen said. Shoppers may reward themselves after spending on others or, on the flip side, justify their own purchases by buying a few gifts.
"It's like it becomes a fever," he said. "For every self-gifted item, there's generally another item that gets added to the assortment as well."
At Fair Oaks Mall in the Washington, D.C. area, general manager Robbie Stark said self-shopping dominated the Black Friday weekend, including one four-hour line of teen boys waiting to buy $10 T-shirts at Elite Board Shop, which sells skateboard gear. He said retailers welcome the business to pad holiday sales.
"The more self-buying that goes on, that's good because they're still going to get the gift-buying," he said.
Still, New England Consulting Group founder and chief executive Gary Stibel said any increase in self-gifting is incremental at best. Shoppers put their kids first and their pets second, he said. Parents and spouses take the back seats, leaving only a tiny portion of discretionary income left over for personal indulgences.
"She's trying to take care of everybody, but she more often than not puts herself last," Stibel said of the typical female shopper. "She's too damn conscientious for her own good."
So which actually makes us happier: self-sacrifice or self-indulgence? A study by Harvard Business School associate professor Michael Norton and two colleagues from the University of British Columbia in 2008 examined whether shoppers derived greater pleasure from spending on themselves or on others.
The researchers gave up to $20 away to shoppers with instructions to spend it on themselves or on other people -- perhaps through a gift for a friend or a donation to a homeless shelter. Though most people expected to enjoy keeping the money, Norton said that at the end of the day, those who bought for someone else reported feeling significantly happier.
Of course, devoting a day of shopping for someone else is one thing. But the holiday shopping season is two full months of making a list, checking it twice, then trying to balance your checkbook. Norton said his research did not examine whether the drawn-out process of gift-giving can overwhelm the joy of giving, but he is clearly no Grinch.
"In the moment of giving," he said, "it's still nice to have given a gift to someone."
(Source: The Washington Post, 12/06/10)
