A survey by Consumer Reports shows that consumers plan to start shopping later for the holidays this year than in the past. At the same time, retailers including Wal-Mart, Toys 'R' Us and Circuit City have gone on the offensive announcing special deals well in advance of Black Friday.
According to the Consumer Reports survey, only 22 percent expect to get their holiday shopping done right after Thanksgiving this year compared to 30 percent in 2006. Another 45 percent said they expected to finish shopping for the holidays by the second week of December while 20 percent didn't expect to complete their purchases until Christmas Eve. A full six percent don't expect to finish their shopping until after the season is over.
The study also found that consumers intend to watch their holiday spending carefully so retailers will need to sharpen their pencils.
"Our findings suggest that consumers are tightening their wallets this year more so than last year," said Tod Marks, senior editor, Consumer Reports, in a blog on the publication's website. "The holiday shopping landscape is vast. Consumers need to make well informed decisions on their budget and on their purchases to alleviate the large bills and possibly disappointed gift recipients."
Tops on the list of gifts that consumers want this holiday is clothing (71 percent) following by gift cards (62 percent) and electronics (53 percent).
Meanwhile, a number of retailers are going all out on the publicity and advertising fronts to let consumers know that there are great holiday deals to be had beginning this weekend.
The moves by merchants follows a pattern that has developed in recent years with stores looking to get a head start on the competition. The timing, much earlier than in the past, is the surprise element at play this year. The types of deals being promoted right after Halloween are not normally seen until the Black Friday weekend.
KB Toys is among those merchants looking to motivate consumers to shop earlier for the holidays.
Geoffrey Webb, director of advertising and sales promotion at KB, told The Associated Press, "This is definitely a preview of Thanksgiving. We heard this is going to be a competitive holiday so we are going to be right in the rings fighting it out."
Ken Perkins, president of RetailMetrics LLC, told the news service, "This isn't good news for stores' profits...It's just more evidence that this is going to be a highly competitive season. Why would you start to drive traffic this early unless the retailing environment is not expected to be particularly strong?"
Discussion Question: If consumers are inclined to shop later and spend more on gift cards, will early sales promotions have much of an effect on holiday shopping behavior? Will the early start by some give them an advantage when consumers finally do get serious about their Christmas season shopping even if it is a week or days before the holiday?
Do retailers that start promoting earlier for the holidays have an advantage over those that wait?