ShopperTrak: Q1 Foot Traffic Will Decline 16.4%

Chicago ShopperTrak reported Monday it is predicting, according to its Retail Traffic Index (SRTI), that total U.S. foot traffic will decline a significant 16.4% in the first quarter, while the company’s National Retail Sales Estimate (NRSE) is forecasting a sharp 4.0% retail sales drop for the same period.

ShopperTrak said it anticipates continued economic pressures, rising unemployment, increasing foreclosures and uncertain credit markets will place consumers in a save, rather than spend, mode throughout the first quarter as they wait for the next big shopping event to spend. Additionally, the 2009 calendar shift which moves Easter from March to mid-April will negatively impact the first quarter as the annual sales and traffic boost from the holiday will shift to Q2.

“Even before the holiday shopping season began, our data and the current state of the economy indicated Q1 could be rather challenging for retailers,” said Bill Martin, co-founder, ShopperTrak. “Although consumers will continue redeeming gift cards and taking advantage of some post-holiday sales throughout January, slow Q1 shopping levels will have the industry scrambling to lure consumers to various retail locations to spend.”

Martin did say, however, that the second quarter could bring some better news, as the middle-class tax break from the new administration instills confidence and Easter and graduation spending take place.