According to the National Retail Federation (NRF), the holiday shopping season is off to a lukewarm start. While there were more shoppers in stores over the past three days, they spent less money than in the past.
The NRF found that 195 million people visited stores or websites over the Thanksgiving holiday and the associated weekend. That is up from 172 million last year. However, overall spending dropped to $343 from $373 last year. Total spending over the weekend is estimated at $41.2 billion.
In comments accompanying the release of the data, the NRF said that consumers were seeking low prices and that big sellers over the first weekend of the holiday shopping season were lower cost items like small appliances, toys, and winter clothes. Retailers "have their work cut out for them to keep people coming back through Christmas."
The destination of choice for shoppers seemed to be department stores. Over the weekend, nearly half (49 percent) of all shoppers visited these stores, up 13 percent from last year. Other places that people visited were electronic stores, clothing stores, and grocery stores. The percentages of people visiting those stores were 29 percent, 23 percent, and 20 percent, respectively.
The most popular purchases were for clothing, books, and toys. Sporting goods, personal care and beauty items, and gift cards saw increases in the percentages of people who purchased them from last year.
Analysts said that caution prevails among shoppers. Whether it's online or in stores, the pie is unlikely to grow, they said.
It is important to remember that the kickoff weekend doesn't necessarily correlate with results from the rest of the holiday shopping season. Last year, for example, sales for the weekend were off by one percent. However, sales for the holiday season dropped by 6.3 percent according to MasterCard.
Despite this, retailers like to use the Thanksgiving weekend to get shoppers into their stores. They're especially interested in getting shoppers to spend early so that they can book that revenue this year, with continued uncertainty over the consumer's willingness to spend. There are signs that shoppers are sticking to lists and budgets. So, stores are using discounts to lure them in. However, unlike last year, when the near collapse of the financial system took retailers by surprise, this year, through tighter inventory control and planned discounts, retailers should be able to profit even from highly discounted items.
Analysts say that waiting until the last minute, which worked well for shoppers last year as retailers were desperate to clear out excess inventory, is unlikely to be a winning strategy this year. Tighter inventory control will reduce the need for fire sale prices to move inventory, analysts said.
In an economy with double digit unemployment, it's unlikely that shoppers will really open up their wallets. Thus, investors in retail stocks, which have seen a huge run up, should be as cautious as shoppers have been thus far this holiday season.
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The NRF found that 195 million people visited stores or websites over the Thanksgiving holiday and the associated weekend. That is up from 172 million last year. However, overall spending dropped to $343 from $373 last year. Total spending over the weekend is estimated at $41.2 billion.
In comments accompanying the release of the data, the NRF said that consumers were seeking low prices and that big sellers over the first weekend of the holiday shopping season were lower cost items like small appliances, toys, and winter clothes. Retailers "have their work cut out for them to keep people coming back through Christmas."
The destination of choice for shoppers seemed to be department stores. Over the weekend, nearly half (49 percent) of all shoppers visited these stores, up 13 percent from last year. Other places that people visited were electronic stores, clothing stores, and grocery stores. The percentages of people visiting those stores were 29 percent, 23 percent, and 20 percent, respectively.
The most popular purchases were for clothing, books, and toys. Sporting goods, personal care and beauty items, and gift cards saw increases in the percentages of people who purchased them from last year.
Analysts said that caution prevails among shoppers. Whether it's online or in stores, the pie is unlikely to grow, they said.
It is important to remember that the kickoff weekend doesn't necessarily correlate with results from the rest of the holiday shopping season. Last year, for example, sales for the weekend were off by one percent. However, sales for the holiday season dropped by 6.3 percent according to MasterCard.
Despite this, retailers like to use the Thanksgiving weekend to get shoppers into their stores. They're especially interested in getting shoppers to spend early so that they can book that revenue this year, with continued uncertainty over the consumer's willingness to spend. There are signs that shoppers are sticking to lists and budgets. So, stores are using discounts to lure them in. However, unlike last year, when the near collapse of the financial system took retailers by surprise, this year, through tighter inventory control and planned discounts, retailers should be able to profit even from highly discounted items.
Analysts say that waiting until the last minute, which worked well for shoppers last year as retailers were desperate to clear out excess inventory, is unlikely to be a winning strategy this year. Tighter inventory control will reduce the need for fire sale prices to move inventory, analysts said.
In an economy with double digit unemployment, it's unlikely that shoppers will really open up their wallets. Thus, investors in retail stocks, which have seen a huge run up, should be as cautious as shoppers have been thus far this holiday season.
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