Retailers launched seasonal sales earlier this year, scrambling to cope with a shorter-than-usual holiday shopping season and adding more promotions to deal with finicky consumers in the midst of the U.S. election.
In the retail industry, holiday spending is expected to grow less this year than last year, prompting companies like Macy's, Lululemon Athletica, Skechers and Academy Sports & Outdoors to take countermeasures. According to the Wall Street Journal.
Spending is likely to rise 2.5% to 3.5% in November and December, for a total of $979.5 billion to $989 billion, according to the National Retail Federation's forecast.
This growth rate is slowing from last year's 3.9% increase and 4.7% increase in 2022, according to NRF.
Money-strapped consumers are becoming increasingly hesitant ahead of the presidential election. Consumer confidence unexpectedly fell in October, according to the University of Michigan Consumer Sentiment Index.
That hesitation, combined with a shorter-than-usual holiday shopping period between Thanksgiving and Christmas, poses a new threat for struggling retailers.
“The days are more important because there are fewer days,” Chuck Grom, senior retail analyst at Gordon Haskett, told the Journal.
Shoppers plan to seek out deals this year, with 62% of Americans expecting to feel a financial strain this holiday season, according to a Bank of America survey.
Nearly six in 10 survey participants said they plan to do more winter shopping at discount stores than last year.
So Academy Sports & Outdoors plans to hold a sale early this year in November to maximize holiday shopping days, Academy Chief Financial Officer Carl Ford told WSJ.
Ford said the move is an attempt by the company to cater to its primarily middle-income consumer group, who prefer credit cards and buy-now-pay-later options at checkout. It is said that the number of people is increasing.
“They've been budget-focused for some time,” he told the Journal. “I don’t think it’s going to magically get better.”
Academy has toned down its discounts in recent years, focusing sales on specific sales seasons like back-to-school and Memorial Day. But Academy promotions will pick up again this holiday season, Ford said.
Sneaker brand Skechers is focusing on innovation to win over customers during the competitive holiday season. The company plans to launch a number of new products, including a collaboration with farm equipment supplier John Deere, new golf shoes and slip-in shoe options, Chief Financial Officer John Vandemomore told the publication. Ta.
“Some might argue that we over-innovate because we test too many things to see what works,” Vandemoer says. “However, the current environment shows that we cannot stand still.”
Vandemoer said he doesn't expect “solid holiday growth” this year.
Macy's, which also owns Bloomingdale's and luxury cosmetics company Bluemercury, is adding beauty and fragrance gift sets and festive apparel to its holiday collection in an effort to boost sales.
Macy's executives said last month at the Goldman Sachs Global Retailing Conference that the company will add 40% new products across categories this holiday season and expand its regular holiday sales to include more products. Ta.
Lululemon, the women's sports apparel retailer, will add more seasonal colors and styles to its products this year, executives said.
However, the company still expects sales to take a hit of about 3% due to the shortened holiday shopping season.
Hita Herzog, chief research officer at H Squared Research and adjunct instructor at Parsons School of Design, says that in a saturated retail environment with tons of promotions, cost-conscious customers are forced to pay high prices. He said he would not be able to make them shop.
“Prices for basic items like food, fuel and clothing remain high. Sticker shock does not bode well for discretionary purchases, especially around the holidays,” Herzog previously told the Post.
“If consumers have to choose between paying for Thanksgiving dinner and participating in Black Friday shopping, they will allocate more of their budget to gifts than to food,” she says. said.
