Economic recession? Global pandemic? Public health crisis?
It’s not going to stop Americans from hitting up retail stores to spend their hard-earned money, at least according to fall retail data and holiday spending forecasting. And being that the holiday shopping season is literally right around the corner, this continuous desire to shop is the bit of optimism that many retailers need to power them through a year that’s been anything but ordinary.
Let’s take a look at what’s sure to be an unusual holiday shopping season.
Accepting the Risk
While there’s no question that retail sales are still threatened by the rising number of COVID-19 cases nationwide – the United States eclipsed a record 100,000 positive cases on Wednesday, November 4 – sales are still higher in recent months than economists had originally forecasted.
In fact, in the month of September alone, retail sales climbed by about 1.9 percent, with the largest gains being in clothing and accessories (11 percent), and sporting goods, music and books (~6 percent). That nearly 2 percent uptick is a lot more than economists originally forecasted, and it spells good news for the remainder of the year.
What Does the Holiday Spending Season Look Like?
According to economists, the holiday spending season will still be fruitful – albeit Americans are expected to spend less on average than they did last year. In fact, according to data from the National Retail Federation, consumers are planning to spend about $50 less on average when it comes to food, gifts and other items around the holidays this year. According to surveyed shoppers, most plan to spend a little less than $1,000 on holiday items this year. This will still amount to a year-over-year growth in retail sales, however it’s a far cry from the 4.1 percent growth that was seen in 2019. Unsurprisingly, due to the virus, many shoppers may opt to shop online with their favorite retailers rather than visit a store in person. In fact, estimates have online retail growing at a whooping 18.5 percent this holiday shopping season.
Other Factors at Play
For retail to really close 2020 on a strong note, an additional stimulus package could prove extremely beneficial. According to economists, an additional package could help ensure that retail’s recovery stays on the right track and doesn’t stall out anytime soon, especially if Americans are presented with additional stimulus checks to spend. An additional stimulus package would also likely provide support for retailers that either voluntarily closed or were forced to close stores based on their location, much like it did when Congress passed the CARES Act last spring during the early days of the pandemic.
How are you most likely to shop this holiday season? Are you planning on hitting up the stores in person or do you see yourself doing most of your holiday shopping online? Are you planning to be more budget conscious than last year?