Two surveys of American consumers about the biggest shopping weekend of the year portends another “dismal” holiday season for retailers. Both Gallup and the National Retail Federation concluded that per-capita spending dropped 8.6% from the previous year, which had been one of the worst in a generation. The NRF, the major trade group for retailers, details the bad news:
Washington, November 29, 2009 –As the closely-watched Black Friday weekend winds down, a National Retail Federation survey conducted over the weekend confirms the expected: more people spent less. According to NRF’s Black Friday shopping survey, conducted by BIGresearch, 195 million shoppers visited stores and websites over Black Friday weekend*, up from 172 million last year. However, the average spending over the weekend dropped to $343.31 per person from $372.57 a year ago. Total spending reached an estimated $41.2 billion.
“Shoppers proved this weekend that they were willing to open their wallets for a bargain, heading out to take advantage of great deals on less expensive items like toys, small appliances and winter clothes,” said Tracy Mullin, NRF President and CEO. “While retailers are encouraged by the number of Americans who shopped over Black Friday weekend, they know they have their work cut out for them to keep people coming back through Christmas. Shoppers can continue to expect retailers to focus on low prices and bargains through the end of December.”
Gallup found almost exactly the same thing in their separate survey:
Americans report spending an average of $106 each day on the Friday and Saturday after Thanksgiving this year, down 8.6% from the $116 average reported on those same days last year.
Gallup analysis has suggested that spending for Christmas gifts this year will be roughly the same as last year, a weak forecast given last year’s dismal overall holiday spending. Gallup’s current day-to-day assessment of overall spending on the critically important days after Thanksgiving appears consistent with this earlier forecast. …
Estimated daily spending for the two days after Thanksgiving this year is an average of $106, compared to a daily average of $116 last year. This is an 8.6% drop, similar to what the National Retail Federation has reported. Precise estimates for spending on specific days are based on smaller sample sizes, have larger margins of error, and Gallup does not usually report them. It can be said, however, that the estimate for Thanksgiving Day itself was very low in both 2008 and 2009 — as would be expected. But the daily spending trends on Friday and Saturday after Thanksgiving this year appear to be reversed in comparison to 2008. Last year, Americans reported spending more on Black Friday than on Saturday; this year, Saturday was the bigger day.
The percentage of Americans who report spending any amount of money on these two days this year is comparable to the percentage for the same days last year. On Black Friday and on Saturday, Gallup estimated that about 70% of Americans spent at least some money on each day.
Last year, Gallup predicted a bad holiday season for retailers based on that dropoff from Friday to Saturday. An increase, as seen this year, may mean better news as we get closer to Christmas. However, the 8.6% decline seen by both Gallup and NRF from an already-bad baseline in 2008 strongly suggests that this will be another slow year.
Gallup asks a good question in its analysis. After all of the economic turmoil in 2008-9, have we hit a “new normal” of lower spending and more frugal lifestyles? Will we ever see a return to extravagant gift-giving and consumption, or will the American consumer become more fiscally conservative and learn to save more? This year will make for a bad test case, since so many are unemployed or underemployed, but the question may loom large for retailers even after some sense of recovery takes place.
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