A Pessimistic Look at Holiday Sales

[marmar]

from 24/7WallStreet:



A Pessimistic Look at Holiday Sales
Posted: November 28, 2012 at 6:30 am


Most evaluations of holiday sales so far have been positive. Black Friday weekend brought record numbers of shoppers into stores, according to groups such as the National Retail Federation (NRF). Research firm Comscore claims that e-commerce sales reached record levels. However, many estimates of how well retailers have done during the holidays do not match one another. And some are very pessimistic, which raises the question of whether holiday sales were really strong at all.

New data from Gallup shows:

Self-reported U.S. consumer spending in stores, restaurants, gas stations, and online averaged $67 per day in the week ending Nov. 25, including Black Friday weekend. This is down from $83 a year ago and the $79 comparable for 2010, and essentially matches the 2009 weekly comparable of $69.

By Gallup’s measure, spending was not much better than at the bottom of the recession.

The difference between Gallup and much of the balance of the research on holiday activity is that it is “self-reported.” Data from institutions like the NRF are based on outside evaluations of foot traffic and spending measured though evaluations not based on the consumer’s own responses. It could be argued that the difference makes the Gallup data more accurate, because it comes from the consumer’s own mouth. ................(more)


The complete piece is at: http://247wallst.com/2012/11/28/a-pessimistic-look-at-holiday-sales/#ixzz2DXBXTrIQ

[leveymg]

1. This would go right along with the '30s Marathon Dancing quality of people camping out in line

for days in advance of "Black Friday", the most hyped of all shopping High Holy Days.

I wonder how many of those people were actually paid place-sitters and hoping to be "discovered" (paid by PR firms).

Read that new homes sales estimates have also been downgraded this morning. Wonder what other indicators are going to have to be trimmed back or thrown out with the Xmas Tree come the New Year?

[Sekhmets Daughter]

2. I'm beginning to wonder about Gallup....

This morning I received an email from Gallup claiming most Americans, 54% in fact, don't believe the federal government should be responsible for health care. Really Gallup? Is that why most Americans voted for Barack Obama? Somehow their polls don't match the realities on the ground.

I'm not disagreeing with the numbers...it's too early to know which set is correct...but I'm not sure Gallup can be relied upon for anything anymore.

[onenote]

3. average per shopper spending only tells a portion of the story

What also matters is the number of people shopping/spending. I've read (haven't had a chance to find the link) that the number of people shopping/spending was up over last year. So a decrease in the amount that each shopper spent can be and appears to have been more than offset by an increase in the number of shoppers willing to part with money over the Black Friday weekend. (To give an easy to understand, albeit extreme example, imagine that the average spending per shopper in year one was $50 and there were 100 shoppers, for a total of $5000 in spending). Now imagine in year two that the amount spent per shopper was half as much -- $25 -- but the number of shoppers tripled to 300 -- total amount spent would have increased from $5000 to $7500.

Until the end of the shopping season we won't know how this year's holiday sales stack up against previous year's. It could be that people will spend as much as they did last year but spent less of it on Black Friday weekend (and more on CyberMonday and during the rest of the buying season). Or maybe not. Maybe the total number of folks buying will increase, but maybe, when all is said and done, it will decrease.

[sadbear]

4. If we really are dependent on how much useless crap we buy during the holidays,

we are in deep shit.