NRF: Holiday Retail Sales Up 3% to $579.8 Billion

Total holiday retail sales increased 3 percent to $579.8 billion, according to the National Retail Federation. Meanwhile, online sales for the holiday season increased 11.1 percent. Both results were below forecasts.

NRF, the retail trade association projected growth to be 4.1 percent for the two-month holiday period. Shop.org, the multi-channel retail trade association, forecasted a 12 percent growth in online sales for the months of November and December.

Solid consumer spending in the month of December helped retailers finish the year with a healthy holiday shopping season, NRF said. However economic uncertainties sent a cautious consumer to the stores. December retail sales (excluding automobiles, gas stations and restaurants) increased 0.8 percent seasonally adjusted from November and increased 2.1 percent unadjusted year-over-year.

“For over six months, we’ve been saying that the fiscal cliff and economic uncertainty could impact holiday sales. As the number shows, these issues had a visible impact on consumer spending this holiday season,” said Matthew Shay, NRF President and CEO.

December retail sales, released by the U.S. Department of Commerce, showed that retail and food services sales (which include non-general merchandise categories such as automobiles, gasoline stations, and restaurants) increased 0.5 percent seasonally adjusted month-to-month and increased 4.7 percent adjusted year-over-year.

Other findings from the NRF’s December retail sales report include:

• Clothing and clothing accessories stores' sales increased 1 percent seasonally-adjusted month-to-month and increased 2.5 percent unadjusted year-over-year.

• Electronics and appliance stores’ sales decreased 0.6 percent seasonally-adjusted month-to-month and decreased 0.4 percent unadjusted year-over-year.

• Furniture and home furnishing stores’ sales increased 1.4 percent seasonally-adjusted month-to-month and increased 3.0 percent unadjusted year-over-year.

• General merchandise stores’ sales were unchanged seasonally-adjusted month-to-month and decreased 3.4 percent unadjusted year-over-year.

• Health and personal care stores’ sales increased 1.4 percent seasonally-adjusted month-to-month and decreased 0.7 percent unadjusted year-over-year.

• Nonstore retailers’ sales increased 0.5 percent seasonally-adjusted month-to-month and increased 9.6 percent unadjusted year-over-year.

• Sporting goods, hobby, book and music stores’ sales increased 0.6 percent seasonally-adjusted month-to-month and increased 4.7 percent unadjusted year-over-year.

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NRF: Valentine’s Day Jewelry Sales Expected to Reach $3.5 Billion

Tiffany's Elsa Peretti open heart pendant in 18k rose gold.

Consumers are expected to shell out $3.5 billion on jewelry this Valentine’s Day, up from an estimated $3 billion last year, according to a National Retail Federation survey.

More than 17 percent of consumers said they are planning on buying their loved ones something sparkly, up from 15.5 percent last year, according to the NRF’s 2011 Valentine’s Day Consumer Intentions and Actions Survey, conducted by BIGresearch. About 9.5 percent of shoppers will be buying their gift from a jewelry store.

This is the second survey this week that predicts more shoppers will be buying jewelry for their loved ones on this romantic holiday. The IBISWorld survey said that jewelry sales will experience a year-over-year increase of 11.3 percent.

Overall, according to the survey, the average person will shell out $116.21 on traditional Valentine’s Day merchandise this year, up 11 percent over last year’s $103. Total holiday spending is expected to reach $15.7 billion.

“Having surpassed expectations during the holiday season, it seems consumers are not done spending on gifts, which bodes well for the economy,” said Matthew Shay, NRF president and CEO. “Jewelry, candy and apparel sales should provide a nice boost for retailers during the typically slower months of January and February.”

Having cut back on spending in recent years, couples this year will spend an average of $68.98 on their significant other or spouse, up from $63.34 last year. Even family pets will be feeling more of the love this year. The average person will spend $5.04 on their furry friends, up from $3.27 last year. Consumers will also spend an average of $6.30 on friends, $4.97 on classmates and teachers, and $3.41 on co-workers.

Greeting cards will be the most popular gift (52.1 percent), according to the survey. However, spending across the board is expected to be up this year. Clothing ($1.6 billion vs. $1.5 billion in 2010) and dining out ($3.4 billion vs. $3.3 billion in 2010) will also be popular gift options. In addition, celebrants will spend $1.7 billion on flowers, $1.5 billion on candy and $1.1 billion on greeting cards.

As usual, men will spend the most on Valentine’s Day gifts. The average man plans to shell out more than twice as much ($158.71) as the average woman ($75.79).

“Though the economy will still be on their minds, Valentine’s Day holds a special place in many Americans hearts,” said Phil Rist, BIGresearch executive VP, strategic initiatives.

Discount stores (36.6%) will be the most popular shopping destination, but department stores (30.5%), specialty stores (19.4%) and online (18.1%) will share much of the holiday traffic as well. Others will check out their local florist (16.8%) and jewelry store (9.5%).

With co-workers, children and children’s classmates/teachers to buy for, young couples/parents will spend far more than their parents or grandparents on Valentine’s Day. Adults 25-34 will spend an average of $189.97, compared to the $60.22 adults 65+ will spend.

Jewelry is Making a Comeback this Holiday Season

Jewelry has returned to many holiday wish lists, a sign that discretionary spending is back in vogue this holiday season, according to a just released survey.

A total of 23 percent of people surveyed will be asking for jewelry this holiday season, a 10 percent jump from last year’s 20.8 percent, according to the National Retail Federation’s 2010 Holiday Consumer Intentions and Actions Survey, conducted by BIGresearch.

Gift cards will remain the most requested holiday gift this year with 57 percent of people asking for plastic, followed by clothing (48.2%) and books (47.3%).

Overall, U.S. consumers plan to spend an average of $688.87 on holiday-related shopping, a slight rise from last year’s $681.83, according to the annual survey.

As in years past, most holiday gift-givers will spend the largest portion of their budget buying gifts for family ($393.55) and friends ($71.45), though they’ll still carve out room in their budget for small tokens of appreciation for both co-workers ($18.26) and others ($34.82). Total spending on gifts ($518.08) is expected to rise 2.1 percent from last year, which is in line with NRF says. Americans will also spend an average of $41.51 on decorations, $26.10 on greeting cards and postage, $86.32 on candy and food, and $16.86 on flowers.

“Consumers will still shop with the economy in the back of their minds, but we’re starting to see shoppers take baby steps toward a new normal,” said, Matthew Shay, NRF president and CEO. “As Americans open up their wallets for more discretionary gifts like jewelry or take advantage of sales to buy for themselves, retailers will begin to truly believe that the worst may be behind them.”

According to the survey, 61.7 percent of shoppers say the economy will impact their spending, down from last year’s 65.3 percent. Many shoppers say they will compensate by spending less (81.5%), comparison shopping online (30.9%) or with newspapers and circulars (28.1%), shopping for sales (54.1%) or using more coupons (40.6%). Although the economy continues to impact shoppers, a number of survey results indicate that shoppers may be ready to emerge from their shells this holiday season.

When asked which factor will be most important when shopping this holiday season, the majority of shoppers said that sales or price discounts (41.8%) or everyday low prices (12.7%) were most important. While those factors either declined or remained flat this year, two other categories rose in importance. The number of people who counted customer service as the most important factor rose from 4.4 percent last year to 5.3 percent this year, while shoppers who touted quality as the overriding factor rose from 11.8 percent to 12.7 percent.

“Price is paramount during any recession, but when the economy begins to recover other factors take on greater importance,” said Phil Rist, executive vice president, Strategic Initiatives, BIGresearch. “When shoppers consider other factors like customer service and quality in buying decisions, retailers have the ability to highlight a variety of other features to help their company stand out from the competition.”

Another sign that shoppers feel a bit of breathing room in their budget, the number of persons who say they will make a holiday purchase from a discounter dropped from 70.1 percent last year to 65.1 percent this year. Popular holiday shopping destinations will include department stores (54.5%), grocery stores (46.7%), the Internet (43.9%) and clothing stores (33.6%).

Americans aren’t only shifting where they’re shopping—how they’re shopping is changing, too. Mobile devices like iPhones and Androids are becoming more popular among consumers, and many shoppers plan to use these devices this holiday season to look for gift ideas, compare prices and find items in nearby stores. According to the survey, more than quarter of adults with a smartphone will use these devices to research or make holiday purchases, and that number jumps to 45 percent among young adults 18-24. Retailers are expected to take advantage of this trend by offering more robust mobile apps and Web sites, along with enhanced features like mobile reviews, to cater to Americans looking to shop from their phones.

Yet another hopeful indicator: the number of people who plan to take advantage of holiday sales to make non-gift purchases for themselves will rise 8 percent this year (52.9% in ’09 to 57.1% this year), with the average holiday shopper spending $107.50 on themselves, up from $101.37 last year.

Though the holiday season won’t kick off for many retailers until at least November 1, a sizeable number of shoppers are already planning ahead. According to the survey, 37.2 percent of Americans will begin holiday shopping by Halloween. Women are the most likely to begin shopping by the end of October (42.1%) while young adults 18-24 are among the least likely (27.7%).

NRF expects holiday sales to rise 2.3 percent to $447.1 billion.