Beemer Lowers Forecast for Christmas

December 2, 2008  by in UnCategorized   

By Home Furnishings Business in Furniture Retailing on December 2008 America’s Research Group Founder and CEO Britt Beemer announced Wednesday that he’s predicting the Christmas 2008 retail season to generate 3.5 percent less sales than last year after forecasting a 1 percent drop in mid-November.

Beemer based the revised forecast on disappointing data from the third America’s Research Group/UBS Christmas 2008 Survey conducted over the past weekend and the fact that fewer consumers will give gift cards this year, a finding from survey number two.

“When you look at the numbers, you see that over the weekend consumers were frugal and focused, staying within their budgets and concentrating on the deals and advertised specials,” Beemer said. “Add to that the finding that some consumers will give cash or nothing at all instead of gift cards this year makes me very pessimistic.”

Of those consumers who planned to shop over the weekend, 37 percent shopped on Friday and another 37 percent did not shop at all, the highest numbers in over 10 years. Almost one fifth (19.4 percent) shopped at only one store this year, the highest number since 2001 when 23.5 percent shopped at only one store.

Seventy percent (70.2 percent) of consumers said that they stayed within their budgets, an indicator of this year’s disciplined shopper. In addition, 88.1 percent bought items they had seen advertised. Both figures are a nine-year high. Also, 88.1 percent of consumers shopped at one of the “early bird” specials on Black Friday, a number surpassed only in 2005, when 91.3 percent hit the specials.

Of those consumers who normally give gift cards but won’t this year, 64.4 percent will give money instead. Only 35.6 percent said they would give gifts instead, dashing retailers’ expectations that fewer gift cards could boost gift sales. Of those consumers who will give fewer gift cards, more than a third (36.4 percent) say that there is a chance they could give nothing at all. These are data from the second America’s Research Group/UBS Christmas 2008 survey released Nov. 20.

Another ominous sign for retail traffic during December is that almost twenty percent (19.1 percent) of shoppers say they have finished 90 percent or more of their shopping this year, compared to 13.6 percent last year; and 63.1 percent said that they would finish their shopping in three days or less.

Consumers seem to be shopping less online if they can’t find an item in the store. When asked if they went online because they could not find an item in the store, only 12.3 percent said “yes,” a nine-year low.

The one winner this Christmas appears to be Wal-Mart, where 61.3 percent of consumers shopped for gifts versus 59.3 percent last year. In addition, 78.3 percent of those shoppers who did not go to Wal-Mart this weekend said they expected to shop there this Christmas season.

The America’s Research Group/UBS 2008 Christmas Survey, consisted of 809 telephone interviews from a pool of 849 consumers who said in previous surveys that they intended to shop over Thanksgiving Weekend. It was conducted Friday, Saturday and Sunday, Nov. 28–30, at America’s Research Group headquarters in Charleston, S.C.