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BLACK FRIDAY SALES UP OVER LAST YEAR

Though the holiday season is far from over, retailers across the country are breathing a collective sigh of relief after shoppers headed to stores and web sites in droves over the Thanksgiving Day weekend. According to the National Retail Federation’s 2008 Black Friday Weekend survey, conducted by BIGresearch, more than 172 million shoppers visited stores and web sites over Black Friday weekend, up from 147 million shoppers last year.

Shoppers spent an average of $372.57 this weekend, up 7.2 percent over last year’s $347.55. Total spending reached an estimated $41.0 billion.

“Pent-up demand on electronics and clothing, plus unparalleled bargains on this season’s hottest items helped drive shopping all weekend,” said NRF president and CEO Tracy Mullin. “Holiday sales are not expected to continue at this brisk pace, but it is encouraging that Americans seem excited to go shopping again.”

Friday (November 28) was clearly the busiest day of the weekend with 73.6 million people hitting stores and web sites for doorbuster sales. Though traffic did subside after Friday, retailers were also buoyed by two-day sales as 56.9 million people shopped on Saturday (November 29), up from 48.3 million last year, while another 26.2 million people planned to shop on Sunday (November 30). Thanksgiving Day also continues to increase in importance as the number of people who shopped on Thursday was up 48 percent over last year (16.2 million people vs. 10.9 million people).

Those who shopped on Friday lived by the adage that the early bird catches the worm. The survey found that 23.3 percent of shoppers were at stores by 5 a.m. while more than half (57.6%) were at stores by 9 a.m.  Bargains appeared to be so good that people have more of a jumpstart on shopping.

According to the findings, Americans have completed slightly more shopping than they had one year ago (39.3% vs. 36.4%), indicating that traffic and sales over the next several weeks will moderate.

“Though retailers should be encouraged by strong traffic and sales over the weekend, consumers are still being cautious,” said Phil Rist, executive vice president, strategic initiatives, BIGresearch. “Weekend shoppers indicated that they are still sticking to a budget and thinking carefully before making any holiday purchases.”

Though retailers in all categories were featuring big bargains, a majority of shoppers visited discount stores for holiday deals. According to the survey, more than half (54.7%) of the weekend’s shoppers visited discount stores. Nearly half (43.0%) shopped at a traditional department store, up 11.1 percent from 38.7 percent last year. About one-third of shoppers visited specialty stores like clothing or electronics stores (36.0%) and shopped online (34.0%).

As expected, many shoppers (50.9%) purchased clothing and accessories over the weekend while 39.0 percent bought books, DVDs, CDs and video games and 35.9 percent purchased consumer electronics. Toys were also big sellers, as 28.5 percent of shoppers bought a toy. Gift card purchasing dropped ten percent with 18.7 percent of shoppers purchasing a gift card over the weekend, down from 21.0 percent last year. 

NRF continues to project that holiday sales will rise 2.2 percent this year to $470.4 billion. 

GIFT CARD SPENDING DROPS

Shoppers’ price-conscious mentality is taking a toll on the season’s most-requested present: gift cards. NRF’s sixth annual Gift Card Survey, conducted by BIGresearch, found that gift card sales will fall nearly six percent this holiday season to $24.9 billion, down from $26.3 billion last year. Fewer people plan to purchase gift cards this year (53.5% vs. 56.6% last year) and gift card shoppers will be spending less overall on the cards ($147.33 vs. $156.24 in 2007).

“Since gift cards never go on sale, some price-conscious shoppers will be passing up gift cards in favor of holiday bargains,” said NRF president and CEO Tracy Mullin. “Retailers may need to make minor adjustments to holiday plans as fewer people may be hitting the stores in January to redeem gift cards.” 

The survey found that the biggest gift card spenders this year will be men, who will spend an average of $156.98 on the cards, and Americans over age 45, who will spend $168.02.

Preliminary gift card research conducted for NRF by BIGresearch found that the main reason shoppers plan to buy fewer gift cards this holiday season was because they feel the cards are impersonal (22.7%), that they would rather stretch their dollar by buying merchandise on sale (10.9%), and because they do not want to buy a card with expiration dates or added fees (9.8%). Other shoppers say they simply do not know which gift card a person would want (7.7%), while a small number of people say that they are worried the gift recipient will lose it (3.9%) or that the retailer will go out of business (3.1%).

Though gift card spending is expected to decrease, more people than ever will be asking for the cards this holiday season. According to NRF’s first holiday spending survey, released in October 2008, 54.9 percent of consumers would like to receive a gift card this holiday season, up slightly from 53.8 percent last year. Gift cards will be the most requested gift this year, followed by books, CDs, DVDs, videos or video games (50.0%) and clothing or accessories (49.8%). 

“Most consumers have been holding back on spending for themselves all year long and would love nothing more than receiving a gift card that would let them buy whatever they want,” said Phil Rist, vice president of strategy for BIGresearch. “Being able to walk through a store and select their own present would be a gift in and of itself for many Americans.”

When it comes to buying apparel and electronics, shoppers are most interested in hearing from their peers about products, retailers and past shopping experiences. In a recent survey, conducted for the Retail Advertising and Marketing Association by BIGresearch, consumers say that word of mouth is still the number one influencer in their apparel (34.3%) and electronics (44.4%) purchases.

In addition to first-hand knowledge, product reviews (36.8%) and retail advertising inserts (29.2%) – or circulars – will also resonate with consumers in their electronics purchases this holiday season. Shoppers looking for the best deal on apparel items, from new jeans to winter coats, will check out circulars (33.3%) and in-store promotions (30.4%).

“Retailers offering great deals will use many channels this holiday season to make sure their customers aren’t left in the dark.” said Mike Gatti, executive director, Retail Advertising and Marketing Association. “If retailers can’t get the word out to shoppers about their sales and promotions this holiday season, the lowest prices in the world won’t bring customers into the stores.”

The study also found traditional advertising vehicles like broadcast television (25.9%), direct mail (20.0%) and emails (20.6%) still remain steady influencers for consumers’ electronics purchases. Shoppers say that newspaper ads are more influential this year compared to last year (22.9% vs. 20.2% in 2007) as consumers continue to be diligent with bargain hunting.

Product placement is another huge driver in adults’ purchase decisions. When it comes to electronics purchases, 13.2 percent say it influences their decisions, while 11.5 percent say it influences their apparel purchases. Blogging also influences 6.0 percent of the average population’s electronics choices and 3.3 percent of their apparel purchases.

Young adults are often much harder to reach in terms of advertising and marketing campaigns. Many surf the web while watching television; some engage in other activities, such as text messaging, while reading the newspaper, and even more watch television while reading their mail. According to the survey, 45.0 percent of 18-34 year olds watch television while browsing the web, 25.8 percent engage in other activities while watching TV and 26.0 percent surf the internet while listening to the radio.

“Americans are serious multi-taskers,” said Gary Drenik, CEO, BIGresearch. “Retailers need to communicate through the right channels this holiday season to ensure shoppers hear them.”