Boulder, CO, Oct. 20, 2011 (GLOBE NEWSWIRE) -- 2011 Holiday Retail Sales Projections
With the 2011 Holiday shopping season rapidly approaching, endless questions abound as to what retailers should expect. Despite continued consumer uncertainty over the stock market, higher gas and food prices, sputtering job growth, and modest income growth for 2011, the National Retail Federation is predicting a 2.8% increase in Holiday Retail Sales to $465.6 billion.[i]
Perhaps more intriguing is the fact that projections for online retail sales during the Holiday season (defined as November and December) are quite bullish. According to a report released earlier this year by eMarketer, at least a 12% increase in online retail sales are projected for 2011.[ii] Consulting firm Accenture recently released the results of a survey showing 66% of consumers say they will shop for Holiday gifts online this year, with 59% of shoppers expecting to buy more than half of their holiday gifts online, an 18% increase from 2010.[iii]
Contributing to these projections are several positive metrics that are frequently overlooked, including the fact that there have been 14 consecutive months of retail sales growth and a substantial reduction in household debt over the past year. Plus, Americans are increasingly doing their shopping online through an ever-expanding arsenal of mobile devices including smartphones & tablets.
Experience Gift Industry - Factors Contributing to Strong Holiday Outlook
One industry anticipating substantial growth this Holiday season is the burgeoning "Experiential Gift" industry. Gift Experiences offer consumers the opportunity to give the gift of an experience (i.e. racecar driving, golf lessons, food & wine tours, etc…) rather than typical products like electronics or clothes.
The Experiential Gift industry is still in its infancy in the United States, with the handful of major players having been in existence no more than six years. With the Gift industry as a whole valued at over $300 billion, the room for growth in the Experiential Gift industry in the United States is tremendous. In places like the U.K. and Australia, Experiential Gift companies have been thriving for over 20 years.
According to Bobby Augst, Executive V.P. of Cloud 9 Living - an Experiential Gift company in the U.S., the industry has several factors pointing towards a very strong 2011 Holiday season. First, the overall increase in online shopping bodes well for the industry, as the vast majority of sales for companies like Cloud 9 Living are conducted online. Second, there appears to be a notable shift in consumers’ values, with a greater emphasis being placed on "experiences" as opposed to traditional physical products. For example, Mr. Augst points to the explosive growth recently seen by companies like Groupon and Living Social. Although he notes these companies have little application in the "gifting" industry, their growth is emblematic of the overall shift among consumers towards purchasing experiences rather than "just accumulating more stuff".
"People aren’t looking for ‘stuff’ anymore, they’re looking for experiences", says Susan Menki, VP Behavioral Analyst at Mintel.[iv] Pam Danziger, President of Unity Marketing recently remarked that the lag in experience gifts, and the lag in consumers recognizing giving experiences as gifts was an option surprised her, but she now believes marketers are catching on.[v]
As consumers and marketers continue to catch on and turn to Experiential Gift companies like Cloud 9 Living, all signs are this could be one industry to watch this Holiday season.
By Bobby Augst
[i] NRF Forecasts Holiday Sales Increase of 2.8 Percent to $465.6 Billion, National Retail Federation, available at http://www.nrf.com/modules.php?name=News&op=viewlive&sp_id=1206.
[ii] Quick Stat: At Least 12% Growth Expected for Online Holiday Sales This Year, eMarketer Digital Intelligence, available at http://www.emarketer.com/blog/index.php/quick-stat-12-growth-expected-online-holiday-sales-year.
[iii] Accenture Study Finds Consumers’ Holiday Spending Will Be ‘Careful’ and ‘Controlled’ in 2011, Accenture, available at http://newsroom.accenture.com/news/accenture-study-finds-consumers-holiday-spending-will-be-careful-and-controlled-in-2011.print.
[iv] New Gift-Card Trend Swaps Stuff for Social Capital, Advertising Age, Beth Snyder Bulik, available at http://adage.com/article/news/gift-card-trend-swaps-stuff-social-capital/149582.
[v] Id.