Customer Growth Partners raises holiday forecast
It's shaping up as a happy holiday for the nation's retailers — so much so that one retail research/consulting firm has raised its already strong seasonal sales forecast.
Based on preliminary data for November from the Department of Commerce data, and on its own field research of America’s 50 largest retailers, Customer Growth Partners raised its holiday forecast from its already above-consensus forecast of 4.3% growth to 5.6% growth, the best increase since 2005.
"Accelerating rapidly after several years of tepid growth, holiday spending is seeing its best performance in years, with widespread gains both in stores and online, and across both value and upmarket formats," said CGP president Craig Johnson.
Johnson noted that, for the first time in years, growing spending momentum is evident across all demographics, not just among upper income quintiles.
“The biggest driver of retail spending is growth in real disposable income," he said. "We’re seeing solid job growth in both services and manufacturing, record stock markets, low inflation, and at least moderate wage growth, so all the ingredients are in place for a sustained rebound in consumer spending — which accounts for 70% of GDP.”
If sustained through December, the 5.6% pace would represent the strongest holiday retail growth since pre-recession 2005’s increase of 6.1%.
CGPs 17th Annual Holiday Forecast, issued in October, called for record sales for the November-December Holiday period of $663 billion, up from $635 billion last year. CGP has now raised its 2017 holiday forecast to $671 Billion, yielding the 5.6% year-over-year increase. [CGP’s forecast excludes autos/parts, gasoline/fuel oil, and restaurants.] As predicted in CGP’s forecast, estimated sales to date are paced by:
• Online sales: up 10.5%
• Home Improvement: up 8.5%
• Off-Price Stores: up 7.4%
• Superstores/Clubs: up 6.4%
Not all retail sectors have thrived, however, with women’s apparel retailers and sporting goods seeing sluggish sales at best. Department stores, while far lagging peak performance levels of many years ago, are more of a mixed bag, with better in-store traffic than dour expectations, along with improving online growth, according to CPG.
“Holiday 2017 is poised to turn out better than many expected — and may well be a lot better,” Johnson said. “After years in hibernation, consumers are finally flexing their spending muscles. Now, the cash registers are ringing — giving retailers, despite years in the doldrums, some real holiday cheer, to cheer about.”
CPG ranks the following as among the hottest products of the season:
• Apple’s iPhone X, iPhone 8-Plus and Series 3 Watches
• Nintendo Switch
• Microsoft’s X Box One-S
• WowWee’s Fingerlings• Squishies (multiples sources)
• Spinmaster’s Hatchimals, Air Hog drones, and PAW Patrol Lookout Tower
• Hasbro’s NERF and Star Wars/Last Jedi toys
• Sweaters (perennially the top gift item)
• Biggest self-gifting items: women’s boots and ripped jeans.
Based on preliminary data for November from the Department of Commerce data, and on its own field research of America’s 50 largest retailers, Customer Growth Partners raised its holiday forecast from its already above-consensus forecast of 4.3% growth to 5.6% growth, the best increase since 2005.
"Accelerating rapidly after several years of tepid growth, holiday spending is seeing its best performance in years, with widespread gains both in stores and online, and across both value and upmarket formats," said CGP president Craig Johnson.
Johnson noted that, for the first time in years, growing spending momentum is evident across all demographics, not just among upper income quintiles.
“The biggest driver of retail spending is growth in real disposable income," he said. "We’re seeing solid job growth in both services and manufacturing, record stock markets, low inflation, and at least moderate wage growth, so all the ingredients are in place for a sustained rebound in consumer spending — which accounts for 70% of GDP.”
If sustained through December, the 5.6% pace would represent the strongest holiday retail growth since pre-recession 2005’s increase of 6.1%.
CGPs 17th Annual Holiday Forecast, issued in October, called for record sales for the November-December Holiday period of $663 billion, up from $635 billion last year. CGP has now raised its 2017 holiday forecast to $671 Billion, yielding the 5.6% year-over-year increase. [CGP’s forecast excludes autos/parts, gasoline/fuel oil, and restaurants.] As predicted in CGP’s forecast, estimated sales to date are paced by:
• Online sales: up 10.5%
• Home Improvement: up 8.5%
• Off-Price Stores: up 7.4%
• Superstores/Clubs: up 6.4%
Not all retail sectors have thrived, however, with women’s apparel retailers and sporting goods seeing sluggish sales at best. Department stores, while far lagging peak performance levels of many years ago, are more of a mixed bag, with better in-store traffic than dour expectations, along with improving online growth, according to CPG.
“Holiday 2017 is poised to turn out better than many expected — and may well be a lot better,” Johnson said. “After years in hibernation, consumers are finally flexing their spending muscles. Now, the cash registers are ringing — giving retailers, despite years in the doldrums, some real holiday cheer, to cheer about.”
CPG ranks the following as among the hottest products of the season:
• Apple’s iPhone X, iPhone 8-Plus and Series 3 Watches
• Nintendo Switch
• Microsoft’s X Box One-S
• WowWee’s Fingerlings• Squishies (multiples sources)
• Spinmaster’s Hatchimals, Air Hog drones, and PAW Patrol Lookout Tower
• Hasbro’s NERF and Star Wars/Last Jedi toys
• Sweaters (perennially the top gift item)
• Biggest self-gifting items: women’s boots and ripped jeans.