As promising holiday predictions continue to roll in, retail experts are beginning to try and tease out where all that money will be spent, as more stores try to find ways to win shoppers back to stores, through better experiences and omnichannel offerings of their own.
The International Council of Shopping Centers says consumer spending will grow 4.5% this season, reaching $807 billion, with $685 for gifts and other holiday items and $122 billion on food and beverages. Some 92% of those surveyed plan to buy gifts and other holiday items, with the average per-person spending $706.40, with $522 budgeted for gifts.
The ICSC estimates that 84% of all shoppers plan to visit malls and shopping centers.
That increase isn’t surprising, says Tom McGee, the association’s CEO. “With a strong economy, consumer sentiment and a good job market, we expect a strong holiday season.” Consumer confidence is at its highest levels since 2000.
He tells Marketing Daily that while much has been made of the recent “retail apocalypse,” with the closure of stores ranging from Toys R Us to Lord & Taylor to Henri Bendel, he believes “we’re in the midst of a retail renaissance. It’s certainly been a time of disruption, but after a decade of retailers investing heavily in digital channels, I think we’ll see them spending the next decade spending more money on the physical environment they offer.”
While shopping mall vacancies are at their highest in seven years due to closures, he says demographic shifts favor retail in general, no matter what the channel. “Millennials, the biggest demographic group in U.S. history, are just about to move into their heaviest consuming years, when they get married, buy homes and have kids,” he says.
Forrester, however, isn’t nearly as bullish about mall sales. It’s forecasting a gain of just 1.7% in U.S. in-store holiday sales, reaching $567 billion. It expects a 14% jump in online holiday retail sales in the U.S., growing from $129 billion last year to $151 billion. And it anticipates that online shoppers will spend an average of $785 each, 11% higher than in the 2017 holiday season.