Based on current retail trends and broader macroeconomic data, U.S. retail stores this holiday season (November through December) will see a 3.8% increase in overall sales (excluding automobiles and petroleum) from last year, with margins consistent with recent holiday seasons, according to a forecast from store retail analytics firm RetailNext that was emailed to Retail Dive.
Digital sales will rise 14.9% from last year, while brick-and-mortar stores can expect a 2.1% increase, according to the report. Total annual retail sales are on track to surpass $5 trillion for this year, and online orders should break through the $550 billion level, the firm said.
Top seasonal performers will include off-price, warehouse clubs, do-it-yourself home improvement and specialty stores in the jewelry, men’s fashion and home furnishings segments, according to the report. Department stores and larger format discount stores will be most challenged and could trend downward 3%-4%, with only a few high performers bucking the negative trend, RetailNext said.
Some of the boost this year isn’t quite additive, as RetailNext expects holiday shoppers to wait past October, like last year, for much of their seasonal shopping.
"Holiday 2016 saw consumers slightly shift some of their holiday purchasing from October into November and December, and represents a trend of shoppers waiting until closer to actual events to make their purchases," RetailNext vice president of retail consulting Shelley E. Kohan said in a statement. "A continuation of those shopper behaviors will put even greater emphasis for retail to make the most of the last two months of the calendar year."
The one-day holiday blockbuster events are losing influence with shoppers, she noted. Black Friday is giving way to a more diffuse pattern, as shoppers look for deals starting at Halloween. And mobile promises to play an even bigger role than last year, both online and off, according to Kohan, which could take away some of Cyber Monday’s power.
"As a result, the industry will see more online purchases on Thanksgiving and Black Friday than it will on Cyber Monday itself, as retailers work hard to create online/in-store synergies within their organizations to serve engaged, empowered and captivated shoppers," she said.
Online shopping at the holidays continues to surge, according to other forecasts. E-commerce’s share of total retail sales during the all-important season — which all told will rise 3.1% to $923.15 billion (or 18.4% of the year’s total retail sales) — will climb to a record 11.5%, according to a report from eMarketer. Department stores are in trouble: a lot of that online shopping will go to one retailer (Amazon), according to CPC Strategy, which also found that some 72.1% of consumers plan to look for gifts on Amazon. Still, physical stores remain dominant, with 60.4% of shoppers planning to go to the physical stores run by Walmart, Target or other big box retailers, and 38.6% planning to shop through those retailers’ websites, according to CPC Strategy.