Fri December 27, 2013
Anemic Holiday Sales Growth, But Bump In Online, Mobile Buying
Originally published on Fri December 27, 2013 5:15 pm
ROBERT SIEGEL, HOST:
From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel. Retailers are wrapping up a lackluster holiday season. Overall, sales were tepid, but growth exploded online, on mobile devices and with the sale of gift cards. NPR's Sonari Glinton has that story.
SONARI GLINTON, BYLINE: As important as the lead up to Christmas is, increasingly it's this time that's become important. I'm here at one of these premium outlet malls just 90 miles east of Los Angeles near Palm Springs where I wanted to come find some consumer who were looking for and getting deals. Pardon me, ma'am, do you mind if I ask you a quick question for NPR about shopping?
MAKAYLA DUBENESKI: Sure.
GLINTON: OK. You did a lot of it today, huh?
GLINTON: Makayla Dubeneski(ph) was loaded down with packages waiting for her husband to get the car.
DUBENESKI: You know what? This is the first I'm really doing the after-Christmas shopping, just had - was out in California near the outlets so I decided to come by.
GLINTON: How much of your shopping would you say you did online?
DUBENESKI: Oh, 90 percent. In terms of gifts for other people? Yeah, 90 percent. My family doesn't live nearby so I was shipping things to different parts of the country and it was just a little bit easier.
HORACIO GARCIA: I did all my shopping online.
MEGAN PIPPIN: I did 50 percent.
GLINTON: That's Horacio Garcia(ph) and Megan Pippen(ph) who were visiting from overseas. They also had bundles and bundles of packages. I asked them how much more shopping they did online this year than they did last year.
PIPPIN: The online shopping increased. Well, it's very easy for us, obviously, since we don't have a lot of options to shop where we live.
GARCIA: Yes, I like it more. I like more shopping online.
GLINTON: So why are you here then?
PIPPIN: We don't know. We asked ourselves the whole morning that. Because it's a deal we felt like we'd try and we didn't want to spend any money on ourselves before Christmas so we thought maybe after Christmas we'll be OK with spending money on ourselves when things are cheaper.
KATHY GRANNIS: Self gifting is a very big part of the entire holiday experience for both consumers and retailers.
GLINTON: Kathy Grannis is with the National Retail Federation. She says because of self gifting and nearly $30 billion in holiday gift card sales, the post-Christmas season is increasingly important. Grannis says for retailers, this year has become the year of the mobile shopper.
GRANNIS: As much as 50 percent of the e-commerce traffic they saw on Black Friday derive from a mobile device. And that is huge and I think unparalleled to anything we've seen at any other holiday season so far.
GLINTON: While online sales grew by 13 percent, that wasn't enough to boost the overall retail picture. Holiday sales were up by only 2.3 percent, according to MasterCard. Chris Christopher is an economist with IHS He says add to the slow growth, retailers have lots of inventory. That means the discounts are going to keep on coming.
CHRIS CHRISTOPHER: It's not the best thing for retailers and, of course, you know, if you're a seller, that's the last thing you want to sort of see is the price of your items falling dramatically. It's very competitive and this year, there seems to be excessive discounting compared to last year.
GLINTON: Christopher says consumers are demanding lower prices and convenience. He says the rapid increase in online sales caused glitches with delivering goods on time.
CHRISTOPHER: Consumers are going to remember what happened if they wait till the very last minute so they might hedge a little bit about that, but the cyber sales and the retail space is a locomotive that you can't really stop right now.
HOWARD DAVIDOWITZ: But there is a recognition now that the customer has changed.
GLINTON: Howard Davidowitz is a retail consultant and investment banker.
DAVIDOWITZ: The consumer is more price-conscious than anytime in my memory and retail earnings are being guided downward because they've got tremendous pressure on margin because the consumer wants cheap.
GLINTON: It may be a race to the bottom, but with each season, brick and mortar retailers are losing just a little more ground. Sonari Glinton, NPR News, Cabazon, California. Transcript provided by NPR, Copyright NPR.