“U.S. retailers enter the holiday season vowing to control discounting that has wreaked havoc on their results in the past, but competition between stores, consumers trained to expect discounts and a still-recovering economy point to a difficult year,” Kylie Gumpert and Siddharth Cavale report for Reuters. “The holidays are the most important time of the year for retailers as well as some shoppers: about a third of some stores’ profits are made in the last two months of the year, and discounts can make or break those results.”
“A new forecast from market research firm NPD indicates that holiday shopping could show the slowest year-on-year growth since 2009, and a survey from consultant PricewaterhouseCoopers shows shoppers are increasingly looking for deals,” Gumpert and Cavale report. “PricewaterhouseCoopers expects health and wellness products, athletic apparel and select electronic items like Apple Inc’s iPhone and high-definition televisions to be hot this year, for instance.”
“‘The consumer has been permanently conditioned to expect significant discounts,’ said Steven Barr, who leads PricewaterhouseCoopers’ U.S. Retail and Consumer team. His firm’s survey data show that 87 percent of consumers say price will be the prime factor in deciding what to buy this holiday, up 3 percentage points from last year,” Gumpert and Cavale report. “While the economy has picked up from last year, overall spending is being crimped by stagnant wage growth and rising costs for healthcare and education, according to the consultant. Several analysts surveyed by Reuters said they had seen Christmas décor and service offers already, as retailers try to bring in shoppers before heavy discounts started… ‘In a good economy these types of promotions may not have come this early,’ said The National Retail Federation’s Kathy Grannis Allen.”
Read more in the full article here.
MacDailyNews Take: Apple Watch will be a hot-seller, too. Watch and see.