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Survey: Majority of families impacted by economy this holiday

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Washington, D.C. Two-thirds of American families will be negatively impacted by the downturn this holiday season, according to a survey released Tuesday by the National Retail Federation.

NRF’s 2009 Holiday Consumer Intentions and Actions Survey, conducted by BIGresearch, also revealed that U.S. consumers plan to spend an average of $682.74 on holiday-related shopping, compared to $705.01 last year.

“While last holiday season was filled with chaotic confusion, adjusting to uncertainty has now become routine for many Americans,” said NRF president and CEO Tracy Mullin. “This holiday season will be a bit of a dance between retailers and shoppers, with each group feeling the other out to understand how things have changed and how they must adapt.”

Nearly half (43.3%) of holiday shoppers surveyed said that sales and price discounts will be the most important factor when deciding where to shop. About 13% cited everyday low prices as the overriding factor.

Factors such as selection (21.0%), quality (11.8%), convenience (4.9%) and customer service (4.4%) declined from last year, according to the findings.

The majority of holiday shoppers (70.1%) will shop discounters this year, though more than half (55.8%) will also purchase at department stores. Grocery stores (45.0%), the Internet (42.4%), apparel retailers (33.8%) and electronics stores (31.8%) will also be popular destinations, the survey found.

In addition, 11.4% will buy gifts or other holiday-related merchandise at thrift stores or resale shops. 

Retailers are compensating for soft sales this holiday season by cutting back on inventory.

“In anticipation of weak demand, many retailers scaled back on inventory levels to prevent unplanned markdowns at the end of the season,” said Mullin.  

Other survey findings included:

  • Thirty-nine percent of shoppers will begin their holiday shopping before Halloween, which is comparable to previous years; about 75% of the holiday budget will be spent on gifts, which is comparable to past years; and spending on family members will drop 2%, while gifts for friends and co-workers will see double-digit drops.

Survey bright spots included candy and food spending -- which will increase by $10 this year over last -- and gift cards, which remain at the top of the recipients’ wish lists.

“While the economic climate has shown some improvement from last holiday season, retailers are not out of the woods yet,” said Phil Rist, executive VP, Strategic Initiatives, BIGresearch. “With a variety of factors still up in the air, including uncertainty over job security, many Americans just aren’t buying into the talk of recovery.”

NRF continues to expect holiday sales to decline 1.0% to $437.6 billion.

 

© 2014