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December 8, 2016

Skip the Stress: Our Short and Sweet Holiday Gift-Giving Guide

Buying gifts for friends and family can be daunting, no matter how well you know them. Luckily, our partner CivicScience is here to give you some data-driven information that might help put you at ease, so you can focus on the important things (food and family, of course). In this short post uncover what your friends and family prefer to give as gifts, what your friends and family prefer to receive as gifts, and which gifts are most often returned or exchanged.


December 8, 2016

Consumers are Paying the Price for Toys this Holiday

I had to do a double-take when I saw the data for U.S. toy sales during Thanksgiving week. While I predicted last month that higher-priced items would be a growth driver for the industry this holiday season, I don’t think any of us expected that 85 percent of the industry’s growth during this week would come from price-points over $20. Digging deeper into this price phenomenon, the story – believe it or not – only gets more interesting.

To put these figures into perspective, comparing Thanksgiving week this year to last, we see the gap that existed in higher price-points is now starting to be filled. The $30-39.99 range was underserved last holiday season, while this year it grew at the highest rate over this important week. The strongest dollar growth came from toys priced over $70.

 

 

The top two categories driving growth in these higher price-points during Thanksgiving week both fall under the Outdoor & Sports Toys supercategory: Blasters/Foam Shooters & Accessories filled in the hole we saw in the $30-39.99 range last year, and Skates, Skateboards & Scooters drove most of the growth for the over $70 pricing. Looking back to last year, we may recall that the “hoverboard” types of skateboards were very popular until they were banned due to fire issues. With the issue now resolved, we’re seeing explosive growth once again with these items.

What’s driving this trend in higher-priced toys? It begins with the fact that the toy industry experienced growth over the last couple of years. With this growth, I believe both manufacturers and retailers are more open to investing in new ideas and taking risks. Success breeds innovation, which breeds more success and innovation, and the snowball effect continues to roll.

I also believe that retailers this holiday have become more bullish to higher price-points and accept that parents are willing to pay more for the climactic moment on Christmas morning, when their child opens that big gift under the tree.

There’s also a bigger picture trend at play that we’re seeing around the country and across industries. Consumers are building their personal brand on social media, whether through selfies on Instagram, videos on Facebook, and so on. They want to be part of a broader, social community in an individual way. We’re seeing that toys has a role in this development as well; parents and family members seek that big reaction on Christmas morning, to film and photograph and to share on social media for their family and friends to see. They seek that special reaction, and they are willing to pay a high price for it.    

Each week throughout the holiday season, NPD publishes its Holiday Shopping Bag 2016 Weekly Report, sharing weekly point-of-sale results for key general merchandise categories including toys, apparel, technology, athletic footwear, and prestige fragrances. Week after week, the story has been positive for the toy industry, and I expect this optimism will continue in the time to come.


December 7, 2016

Thanksgiving Week Sales More Than Doubled the Prior Week’s Sales, But, So Far, Holiday 2016 is Still Falling Short

NPD Holiday Shopping Bag 2016 Weekly Report

Thanksgiving Week takes its rightful place as the true start of the holiday shopping season. According to The NPD Group’s weekly point-of-sale results for key general merchandise categories, dollar sales in the fourth week of the 2016 holiday shopping season, which included Thanksgiving Day and Black Friday, more than doubled that of the prior week. While the peak week closely followed the trend seen in 2015, sales were 1 percent lower than Thanksgiving Week 2015. Cumulatively, dollar sales in the first four weeks of the 2016 holiday shopping season fell 3 percent behind the first four weeks of the 2015 holiday season.

Week Ending November 26, 2016*

Overall Performance

  • Dollar sales in the fourth week of November 2016 were 1 percent lower than the fourth week of November 2015.
  • Toys and Prestige Fragrances each beat their week 4 2015 dollar sales results by 3 percent – the only industries to outperform last year for the week and cumulatively over the first four weeks of the season.
  • Toys more than doubled their sales from the prior week.


Top Performing Categories

  • PCs (Notebooks)
  • Home Automation
  • Sports Toys
  • Games/Puzzles
  • Streaming Audio Speakers

Note: Instant Print Cameras also had noteworthy growth

“Retailers of all types set out to lure consumers with an increase in promotions, and it worked…for a few categories, but not for everything. Less conventional holiday winners beat out anticipated headliners, like last year’s wearable fitness tracker success story. But, big TVs are also making their mark on the 2016 holiday season, and a handful of other categories are gaining momentum,” said NPD’s Chief Industry Analyst, Marshal Cohen. “While the pace picked up over Thanksgiving Week, overall the season is still lagging a bit and what follows is the post-Black Friday lull. The challenge facing retailers now is to make the new, more spread-out holiday shopping season work to their advantage, and keep the hottest items in stock as consumers shop with the expectation of continued deals galore.”

Coming Next Week: Holiday Shopping Bag Results for Cyber Monday Week – see if continued promotions tempered the post-Black Friday lull!

* Information is collected from a panel of leading retailers that provide weekly point-of-sale data covering in-store and online sales of Apparel, Toys, Technology, Athletic Footwear, and Prestige Fragrances

Note: Shifts may occur from week to week in reporting results, due to retailer reporting updates.


December 7, 2016

Shoppers Don’t Like Anything About Holiday Shopping

“It’s the most wonderful time of the year,” or so the Muzak piped into the mall speaker system declares as holiday shoppers scramble to complete gift lists on time and under budget. The holiday season fills some of us with stress, while others actually enjoy the season. What gets the holiday shopper excited about the gift-buying season, and how can stores improve the experience?


December 6, 2016

Top 6 Home Entertaining Trends of Holiday 2016

An essential part of the holidays is gathering with your people to celebrate family, friends, and the milestones of the calendar year. For many Americans, this means decking the halls fantastic, making a mountain of food, and buying anything and everything to make the entertaining process easier—and more fun. We combed our POS and consumer databases to discover what people buy to entertain throughout the holiday season. Find out what’s hot during Holiday 2016 across the home and food sectors.

1. People Are Eating at Other People’s Homes More

In general, and specifically with the Millennial cohort, meals eaten outside the home have been on the decline over the past few years in the U.S. Americans are dining out less and eating at home more, with 82 percent of all meals consumed sourced from home. Chalk it up to consumers tightening their wallets post-recession and slow and narrow economic improvements that aren’t significant enough to shake Americans’ conditioned cost-savings behavior.

Meals eaten at other people’s homes have increased, too. Between 2013 and 2015, the number of meals eaten at another person’s home wavered between 32 and 33 meals per person each year, on average. In 2016, this figure jumped by 19 percent to an average of 38 meals eaten at another person’s home over the course of the year, shown by our National Eating Trends® survey and custom research.



Source: The NPD Group/National Eating Trends® and custom research

Our Vice President and Food Industry Analyst David Portalatin attributes this jump primarily to the dinner meal occasion—which increased from 9 to 11 meals eaten at another person’s home from 2015 to 2016. “In-home or away from home, dinner is the most social meal occasion by far, during which Americans are least likely to eat alone. Only 33 percent of dinner meal occasions were eaten alone this year, compared to 48 percent of total meal occasions,” David explains. And at home, Americans eat dinner with guests during 9 percent of all dinner occasions—the highest for any meal occasion.

2. Millennials Stay Home on New Year’s Eve

The tendency for consumers to dine at their own home or the homes of other is perhaps best illustrated on New Year’s Eve—and it’s strongest among Millennials. In the week leading up to the turn of 2016, we asked U.S. adults how they planned to spend New Year’s Eve. Among those who went to a bar, club, or restaurant, the generational breakdown was pretty even: 39 percent of New Year’s Eve restaurant goers were under 35, 30 percent were aged 35-54, and 30 percent over 55 years of age. But looking at survey respondents who planned to host or attend a house party on New Year’s, 60 percent were under 35 years of age—demonstrating that Gen Y and Z are opting to skip overpriced cover charges and the fight for the bartender’s attention in favor of cozier evenings in someone’s home.

Source: The NPD Group/National Eating Trends® and custom research, December 20-30, 2015

3. People Eat at Home on Christmas and Thanksgiving—But Still Buy from Foodservice

Entertaining around the holidays is foremost about the people. Aside from the company with whom we surround ourselves, it’s all about the food. So what, and where, are people eating for the biggest meal occasions of the holiday season—Thanksgiving and Christmas?

David Portalatin describes Thanksgiving and Christmas as overwhelmingly celebrated at home. On Thanksgiving specifically, home is where the stomach is. Our National Eating Trends survey found 48 percent of Americans eat at home on Thanksgiving Day, while 44 percent are invited over to someone else’s home. This leaves only 3 percent of Americans who go out to eat at a full-service restaurant.

Restaurants shouldn’t shutter their doors completely on Thanksgiving, though. To start, more than 19 percent of consumers eat Thanksgiving Day breakfast at a restaurant (the main feast isn’t the only meal of that day). And even when people entertain at home, they still look to restaurants to provide appetizers or entrées for their affairs. We found 29 percent of Thanksgiving Day meal occasions included one item sourced ready-to-eat at foodservice, while only 57 percent of these meals are completely homemade.

For Christmas Eve meals, consumers are twice as likely as Thanksgiving to go to a full-service restaurant (6 percent vs. 3 percent). Since the Christmas holiday entails meals on both the eve and day of, it affords those celebrating the opportunity to enjoy both the comforts of home cooking and the luxury of a prepared meal.

4. The Turkey’s Getting a Spicy Makeover

It’s less expensive to cook a turkey dinner this year, thanks to decreased food commodity prices across the board. So what fare are people serving when company’s over? The simple days of pot roasts and potatoes are now over. While the holidays are typically considered a time for indulgence, our consumer insights partner, CultureWaves, found that a healthier approach to cooking has influenced holiday menus across America. While the turkey may always remain the pièce de résistance on Thanksgiving, it’s gotten a makeover with ethnic spices and unique cooking formats. Whether it’s Cajun-brined, deep-fried, Tuscan-rolled, pomegranate-molassesglazed, or Carolina-barbequed, Americans have their turkey their way.

The turkey’s entourage is changing, too. CultureWaves says traditional side dishes like green bean casserole are being swapped out for healthier alternatives like a cranberry, shallots and quinoa salad, and in many homes, white potatoes and rolls are removed from the table completely. Since our nation as a whole is more health-conscious and accepting of people’s diet choices, the side dish portion sizes are getting smaller on many American tables, and holiday diners are more likely to attempt to stick to their health plan during the holidays.

David Portalatin echoes this sentiment, explaining that Gen Y and Z in particular have grown up with more diversity, access to information, and exposure to new and different things. These experiences have worked their way into their palates, giving younger generations tastes for ethnic cuisines with bold flavors. And for these cohorts especially, meals are more than just sustenance; they’re experiences.

5. Alcohol Gadgets Are Key When Americans Host

Though more at-home eating translates to less promising news for restaurants, the home industry has benefitted handsomely as more people opt to eat at home and spend money on the tools required to create a festive experience for their guests, explains our Executive Director and Home Industry Analyst, Joe Derochowski. Sales of entertaining gadgets grew 11 percent in the 12 months ending in August 2016. Almost all of the top entertaining tools are for alcohol consumption, with cork screws selling best, followed by ice cube trays, coasters, toothpicks, and flasks. The gadgets with the greatest year-over-year growth were ice buckets, wine tool sets, and coasters.


            
                                                 Source: The NPD Group / Retail Tracking Service, 12 Months Ending August 2016

Total beverageware spend was up 7 percent. Barware and entertaining related items drove that growth, including serveware, cups/mugs, ‘Old Fashioned’ glasses, and pilsner/pub glasses. Joe Derochowski says, “similar to New Year’s, when Millennials would rather host their friends than go out to a bar, they also prefer to entertain, be social, and stay connected with their friends at home throughout the year. This helps fuel the growth in entertaining gadgets and beverageware”.

6. Americans Buy Home Scents to Set the Mood

In addition to food, friends, and family, another essential element of a successful home gathering is ambience. A warm and inviting atmosphere can be achieved with physical décor to see and touch. It can also be communicated through smell, be it the warm scent of a burning fireplace, aromas of vegetables roasting in the oven, or the smell of fresh pine. Home fragrance products like candles, diffusers, and room sprays also add to the holiday atmosphere. These olfactory sensations are an essential part of home holiday gatherings. Our retail tracking data shows sales of prestige home fragrances peak around the holiday season (from October to December). Scentiments, our new suite of consumer insights and tools for the U.S. fragrance industry, allows us to take a deep dive on home scents as they relate to entertaining.

Our beauty director and industry analyst, Kissura Craft, describes home scents as the fastest-growing segment in fragrances, outpacing the other segments anywhere from 19 to 27 points. What proportion of Americans use home scents, and which products do they buy? The Scentiments online survey (fielded July through August 2016 to more than 8,000 U.S. adults) found scented candles are the most popular product, purchased by 43 percent of survey respondents. Next in popularity are scented room-spray fresheners (used by 41 percent of respondents), plug-in air fresheners (30 percent), and clip-on air fresheners (21 percent). Most often, consumers use these products in their living or family room (69 percent of respondents) followed by the bathroom (66 percent of respondents).

Many consumers use scented home products to create a welcoming environment for guests, closely linked to home entertaining: 10 percent of buyers use home scents when guests are over. And this number is higher (13 percent) for younger Millennials (aged 18-24). In our Scentiments survey, 49 percent of respondents claimed to make these purchases to create an inviting and comfortable atmosphere. In addition, 35 percent bought home scents specifically to make a good impression when guests are over. This figure skews higher for Millennials (44 percent for younger Millennials and 47 percent for older Millennials, aged 24-34). While we all love the smell of a roasting turkey and fixings, let’s face it—sometimes your guests don’t want to smell (or smell like) onions all evening. That’s why 46 percent of respondents said they buy home scent products to cover or mask odors—of cooking or pets, for example.

Preferences for home scents vary by season, though most consumers tend to stick to their preferred scent families overall. These include sweet/fruity, tropical, food/baking, warm/woodsy, and clean/light. Our survey reported 31 percent of home scent users adjust their scents with the changing seasons. Older Millennials and Gen X are the mostly likely of all age groups to change scents with the seasons (35 percent). People associate autumn with aromas of leaves, pumpkin, cool air, cinnamon, apples, and cider. When it comes to Christmas, they think of scents like baking cookies, gingerbread, pine, peppermint, cinnamon, and crisp air.

“It’s no surprise that scents associated with the holidays rose to the top two spots in November (for example, Nest Holiday and Nest Birchwood Pine candles), replacing the top-selling pear, freesia, and eucalyptus mint scents of September and October. These winter scents help consumers get into and set the mood as the holiday season begins. And the holiday-scented candle from Nest continues to be the best-seller into December,” Kissura explains.

So if you’re entertaining or attending someone’s else gathering this holiday, may it be in the warmth of someone’s home, filled with uniquely flavored, great food (homemade, or ordered in), stocked with the required tools to enjoy your drink, and smelling nice.


November 30, 2016

Finally, It's Beginning to Look a Lot like Christmas – Holiday Spending Kicked Into Gear the Week Before Thanksgiving

NPD Holiday Shopping Bag 2016 Weekly Report

The week before Thanksgiving proved to be an important one for retail this holiday season. According to The NPD Group’s weekly point-of-sale results for key general merchandise categories, following a lackluster couple of weeks, sales in the third week of the holiday season lined up with dollar sales during same week in 2015.

Week Ending November 19, 2016*

  • Dollar sales in the third week of November 2016 were in line with the third week of November 2015.
  • The week’s boost was driven by an 8 percent increase in sales of Toys, compared to the same week last year.
  • Prestige Fragrance also saw a nice uptick during the third week of the holiday season, up 12 percent compared to last year.
  • Apparel sales followed the overall trend, matching week 3 2015 dollar sales.
  • Technology dollar declines seen in previous weeks softened significantly.

Top Performing Categories

  • PCs
  • Women’s Apparel
  • Sport Leisure Shoes (Classics)
  • Kids Outdoor & Sports Toys
  • Games/Puzzles

“Finally, it's beginning to look a lot like Christmas. Some key categories kicked into gear with promotions that drove a lot of sales, and the traditional Christmas categories started to make their move in the third week of November,” said NPD’s Chief Industry Analyst, Marshal Cohen. “Newer categories of importance to the holiday season, like TVs (big ones), casual athletic shoes, outdoor toys, and games, combined with the predominance of online deals, will prove to be catalysts behind the momentum that energizes Thanksgiving week, as well as the lull that follows Black Friday weekend.”

Coming Next Week: Holiday Shopping Bag Results for Thanksgiving/Black Friday Week – see how this important week shaped up!

* Information is collected from a panel of leading retailers that provide weekly point-of-sale data covering in-store and online sales of Apparel, Toys, Technology, Athletic Footwear, and Prestige Fragrances.

Note: Shifts may occur from week to week in reporting results, due to retailer reporting updates.

For more information, or to speak with Marshal Cohen, please contact Janine Marshall, 516-625-2356 or janine.marshall@npd.com, and visit NPD’s Holiday Insights page.


November 29, 2016

Sneakernomics: Holiday Predictions for the Sports Industry 2016

Last holiday season was a particularly strong one for many major aspects of the sports business. There are several factors making this year’s challenging for the industry, but while this year won’t top last, I still expect a fair holiday performance for the world of sports retail.

Sports Authority’s fate puts pressure on the industry: The biggest factor for this year’s holiday selling season in sports is the loss of The Sports Authority. Where there were adjacent big box competitors to TSA we have seen transference, and surely some of the TSA business has gone to the internet; however, much of the TSA business has simply evaporated. This has had a deep impact on the sports industry as a whole. The vacuum created by the TSA closing has had a profound impact on Nike, Under Armour, and Champion, but virtually every brand that did business with TSA is affected.

Chilly sales for cold weather categories: Another variable that’s proving to be unfavorable to the industry thus far is the weather. While it has turned somewhat colder in many parts of the country, we have not seen true winter weather seize the attention of the nation. This will throw shade across the entire industry.

The cold weather categories have been hurt the most. Data from NPD’s Retail Tracking Service show considerable weakness in weather-related categories for October. Outerwear sales declined in the low teens, cold weather undergarments were down double-digits, and the cold weather boot business declined over 20 percent. Retailers have already been much more promotional around the boot categories.

Early sales for the snow sports category have started off much softer than in seasons past. This, along with a delayed winter, poses a challenge. While some of these sales could be made up late, the sales will likely come at the expense of profit.

Ups and downs in the outdoors: The outdoor industry has seen a slow-down this year as well. After very nice growth, outdoor sports categories combined are just flat for 2016. Even the hot premium cooler business has started to plateau. While Millennials drove this trend for the last few years, the “herd, binge, abandon” phenomenon appears to be in effect. Right now, the climbing business is a bright spot for the industry, but overall I expect a mediocre season for the overall outdoor industry.

A slowdown for cycling: The cycling business has continued to be soft for some time and this holiday season is no exception. Sales have been boosted somewhat by a promotional environment as retailers try to clear old stock, but overall I don’t expect it will be as great of a year as last for the cycling categories.

Rise in retro and casual running styles: The run specialty categories have struggled for some time and I expect this to continue through the holidays, as retro and casual running reigns supreme. Recently, sales have improved slightly as the shops have added accessory categories and worked hard on the add-on sales. However, the core shoe business remains in decline as the rise of casual running continues to hurt the technical business.  

A mixed bag for athletic apparel and footwear: The activewear category was having a decent year until we came against the TSA closings. Since then, sales have been soft. Layer on the lack of cold weather and prospects are not bright for a great holiday season. Also, as I identified in early fall, another interesting and important story in activewear is the number of new brands and retailers who are trying to crash the party. More brands and retailers are competing for a place in what has become an oversaturated space, and this influx has created a lot of noise and confusion. I predict that it will be a messy holiday for the activewear business. Beyond activewear, an emerging athletic apparel trend to watch is sports licensed apparel as street wear. There is something bubbling under the surface here, and it’s quite possible that it will arise as the next big fashion trend.

The athletic footwear business was decent up until the TSA closure, which caused sales to soften dramatically. One positive is that the Black Friday Jordan release is far better than last year’s, which should generate store traffic and boost sales. Another positive is that inventories are very clean at retail, which means the danger to margins should be mitigated. Adidas and Puma will remain the hot brands as Under Armour slows up and Nike stays soft. With that said, I foresee a decent holiday for athletic footwear.

It’s all about the click: Looking at shopping outlets, e-commerce and mobile will be big drivers for whatever gains we get in the sports world this holiday. Retailers both large and small that do not have an e-commerce platform will woefully under perform. Those with a great mobile interface will outperform those that do not.

Black Friday’s not a deal-breaker: In many instances, Black Friday started on Tuesday. The day itself has never been that meaningful for sports and this year it will be less so. The same goes for Cyber Monday. These artificial holiday constructs are largely based on price – a tactic that the sports industry has for the most part been able to avoid. What promotions we have seen have been broader in scope, not in depth of discount.

While the sports business is not off to as great of a start this holiday season as others, it doesn’t mean there’s no chance for it to catch up. Various circumstances are leading it to be a challenging holiday for the industry, but overall I still expect the industry to pull through and see some decent gains to close out 2016.


November 28, 2016

A Time for Giving

More than 7 in 10 holiday shoppers in the U.S. agree with the statement, “Giving to those less fortunate than myself is an important part of the holiday season.”
November 28, 2016

Stores Saved Black Friday Weekend

That's right. Despite the surge of online and Thanksgiving Day  in-store sales, combined with the less-than-stellar Friday  in-store sales, retailers got the boost they needed from Saturday and even Sunday in-store business.  Saturday and Sunday, which was almost non-existent last year, showed up to save the overall weekend business this year. 

But, the feel of the weekend was different.  It was filled with shoppers looking for ideas.  It was filled with shoppers socializing and familiarizing themselves with the merchandise. Frankly, many were researching what to get next, after scoring online and in-store Black-Thursday deals.  In the past consumers did their research online and then purchased in-store, but brick and mortar stores are now critical to consumers’ research needs. This translates to exactly what brick retailers needed to round out this Thanksgiving weekend – on Saturday and Sunday consumers came and bought, impulsively and socially.

Welcome to the new dynamic of the peak holiday shopping period that used to center around Black Friday and door busters.  Now, redefined, pre-Thanksgiving online deals and Thanksgiving Day shopping take center stage. Stores play more of a supporting role, but they are still important to the holiday retail story, and they still score big.  



November 25, 2016

Black Thursday Turns Black Friday Grey

Pre-Black Friday online sales starting earlier than in past years, opening on Thanksgiving night; and ongoing doorbuster deals all proved to work well, but perhaps too well.  As Thanksgiving Day sales start to steal the business directly from Black Friday, it appears that Thanksgiving Day has become the new Black Friday, and retailers have no one to blame but themselves. 

Thursday night’s lines were long, and the bags and carts were full, but by midnight that flurry turned to calm. The stores that opened on Thursday were not very busy on Black Friday, and the stores that opted not to open on Thursday may regret it. While the Thanksgiving Day opt-outs were busier on Black Friday, they didn’t see the crowds they saw in previous years. The fact is there are more options for holiday shoppers today than in the past. The holiday shopping season and deals begin well-before Thanksgiving, stores offer longer hours, and the perpetual ecommerce options are spreading out the holiday shopping and spending opportunities for consumers – putting a spin on the idea of spreading holiday cheer.

The retailers that were busiest on Black Friday include electronic stores, mass merchants, beauty stores, and, as always, toy stores. Toy deals and having plenty of the “hot” toys in stock were the keys to success for those retailers. The surprises were the activity at athletic footwear stores and the interest in, yet again, big screen TVs. The too-big-to-pass-up TV deals drove huge interest.

In the 40 years I’ve studied Black Friday, I’ve never seen the crowds this soft on Friday morning; parking wasn't an issue, and lines were shorter than any weekend in October.  I’ve visited the same register at the same store at 7:00 a.m. for the past 15 years.  Last year, I found 70 people waiting to check out at that register. This year, there were only seven people in that line. That says it all. 

Overall, Thanksgiving week will likely chalk up a good start to the 2016 holiday shopping season, but this year it also marked a change to the cadence of holiday, with the shopping activity taking on a new, more spread-out rhythm. 

Welcome to the new Black Friday, or should I say, Black Thursday.  

Follow me on Twitter @marshalcohen to see what I’m seeing this holiday shopping weekend.


November 25, 2016

It’s Time to Change Again

Last year in our Black Friday blog we noted that it appeared most retailers had the holiday figured out. When to open on Thanksgiving, how focused to be on online shopping vs in-store, when to promote and how to do it. Sadly, I think we were a bit premature in declaring a victory (or least an armistice) in the holiday shopping wars. This year many electronics brick-and-mortar retailers succumbed to the reality that opening on Thanksgiving was only for the biggest traffic aggregators, like the malls, and pushed their promotions to Friday morning. Unfortunately, what they missed is that Black Friday, as an event and a shopping experience, has ceased to exist. There were few if any lines at 6:00 a.m. on Black Friday, as that traffic long ago migrated to Thanksgiving Eve or online, yet many retailers continue to chase it.

While I am sure that there will be plenty of volume on Friday afternoon and over the weekend, the need to open early and promotionally on Friday morning seems to have passed. It’s now truly the  Thanksgiving weekend that kicks off the holiday season. And the imperative is now to be truly successful over both Thanksgiving week and Cyber Week. That will be what makes, or breaks, the season for retail. We have seen Thanksgiving week share of holiday sales increase by about 2.5 points over the past 10 years. When combined with Cyber Week, those two weeks are approximately one-third of the nine week holiday season results, up about 5 points overall from results posted in the last 2000’s.

We noted on Twitter the strong lines on Thanksgiving evening, but most of those were at the largest retailers. Best Buy’s success on Thanksgiving, as a more specialty retailer, seems more and more like an aberration, a function of the strength of electronics as a draw for promotionally focused early holiday shoppers (as we would once again note that many of Thanksgiving night’s retailers, even those with only a tangential relationship to CE, such as Kohl’s and Dick’s, led with or focused on CE products as traffic drivers and interest builders).

On the product side, my colleague Ben Arnold has done an admirable job of calling out the new  sales opportunities for consumer electronics in 2016, including Smart Home, VR, Drones and Smart Hubs. However, the real focus of holiday 2016 has been big screen and 4K/UHD TV with record low pricing and seemingly endless demand over the last two days (check out my Twitter timeline for some comments on that) propelling what promises to be a record end, to a record year in TV sales.  Among the other traditional categories, PCs, tablets and mobile phones remain heavily promoted, but the broad appeal of TV, especially the newer technology and bigger screens, has been the prime catalyst for retail interest. Alongside TVs, an increased emphasis on mounts, cables and soundbars, all of which are exceptionally well positioned add-ons to big screen TVs, and benefit from the cleaner sales floor environment (less pile-it-high, pallet stack outs for 60 inch TVs than 32 inch TVs in the past) allowing retailers to fulfill demand for accessories that can add revenue and profit to the challenging Thanksgiving week TV pricing environment.

Despite the positive sprouts we have seen during Thanksgiving week, we would be remiss if we did not note the lackluster results for the first two weeks of November for CE  and the weaker start to Q4 for CE. While these results can be explained by looking at the difficult comparisons to strong launch events in 2015 (iPad Pro and SP4/Surface Book), they do not account for the entire story. Sales in 2015 never capitalized on that strong beginning and left CE with poor results. Those weak comparisons give us reason for hope for this year’s performance. While the final judgment of the holiday, as always, awaits a complete accounting of sales for the entire nine week holiday season (which we will provide in our CES Research Summit wrap up) the CE business has faced challenges around pricing and demand throughout 2016 and despite the easy comparisons, success is not guaranteed.


November 25, 2016

New Consumer Electronics Products Help Bring Out the Black Friday Crowds

This year my family spent Thanksgiving in Manhattan, making for a memorable post-dinner technology shopping tour in the city. Among the handful of stores I visited Thursday night, a trip to Best Buy on the Upper East Side really stood out. This wasn’t the big store I’m used to in Virginia; this smaller, city-sized Best Buy boasted a club-like atmosphere. It was packed at 10:00 p.m., long after the opening rush at 5:00 p.m., and an in-store Sonos system played Rihanna and Future throughout the building.  A Beats mini-store on the lower level featured several headphones to demo. It felt more like a technology shopping party than a post-Thanksgiving bargain hunt.

The vibe in this Best Buy was well timed. According to NPD’s 2016 Holiday Purchase Intentions Study, more than a third (36 percent) of shoppers expect to buy technology products this holiday and shoppers even expect their spending on technology to increase (+5 percent this season).  The growth in premium feature segments like television, imaging and tablets are certainly contributing to this, but the growing selection of products in emerging categories are also driving interest in CE around the holiday. In fact, this Black Friday, ample promotions around products like drones, voice-enabled speakers, and virtual reality headsets are helping drive shoppers to the stores. 

Most of these new product categories offer a diverse range of price points. For those looking to try VR, products like the Oculus Rift and PlayStation VR are available, as well as Google’s Daydream ($79) and Zeiss VR One ($99). The idea of a voice-controlled speaker was nearly unimaginable for most consumers just two years ago, but Google Home is on sale this weekend for just $99, and Amazon’s Echo Dot can be bought for as little as $39. So far, drone promotions have ranged from $59 to $999. In somewhat of an unusual occurrence, this wide array of pricing has made these new technology products more accessible to shoppers this holiday.

This bodes well for the shopping season. In addition to the attractive promotions on 4K TVs, PCs and cameras that we have become accustomed to, shoppers are flocking to stores to buy these new technology categories – not just try them. To me, that will be the real story of Black Friday – the ability of new, interesting products to get tech shoppers to come out to the stores.    


November 23, 2016

NPD Holiday Shopping Bag 2016 Weekly Report

NPD Holiday Shopping Bag 2016 Weekly Report

Consumers may still be suffering from post-election distraction, and even the flurry of early retailer promotions hasn’t caught their attention.  According to The NPD Group’s weekly point-of-sale results for key general merchandise categories, second week holiday sales were down 8 percent compared to same week results in 2015. 

Week Ending November 12, 2016*

Overall Performance

  • Dollar sales in the second week of November 2016 were 8 percent lower than they were in the second week of November 2015.
  • Each of the five industries being tracked — Apparel, Toys, Technology, Athletic Footwear, and Prestige Fragrances — saw dollar sales declines.
  • Technology and apparel continue to account for the most sales, but displayed the largest declines compared to last year.
  • Declines in dollar sales of athletic footwear and fragrances were minimized by increases in the average amount spent per item.


“Classic holiday winners, like apparel and tech, are lagging a bit early on, but it’s just not their time yet. New, more innovative products that tend to be gobbled up before Thanksgiving – often self-gifted – will do well early on,” said Chief Industry Analyst, Marshal Cohen.

Top Performing Categories

  • Sport Leisure Shoes (Classics)
  • Home Automation (Security & Monitoring)
  • Stereo Headphones
  • Kids Outdoor & Sports Toys
  • Children/Infant Apparel Sets

“The increased competition from both brick and click coming earlier in the holiday season has retailers jockeying for position in the consumer’s spending plan, and we can see how those efforts are playing out,” said Cohen. “Retailers are front-loading the season with promotions, creating a shift in spending cadence and making year-over-year growth more challenging. While some consumers take advantage of these early deals, there is still an important second wave that happens closer to the holiday – consumers know the deals will keep coming.”

* Information is collected from a panel of leading retailers that provide weekly point-of-sale data covering in-store and online sales of Apparel, Toys, Technology, Athletic Footwear, and Prestige Fragrances. 
Note: Shifts may occur from week to week in reporting results, due to retailer reporting updates.

For more information, or to speak with Marshal Cohen, please contact Janine Marshall, 516-625-2356 or janine.marshall@npd.com, and visit NPD’s Holiday Insights page.


November 22, 2016

Hello, Fun Socks Season

As I notice the beautiful fall foliage outside my window I’m quickly reminded that boot season is upon us – that means it is time to break out my fun socks. Besides providing me with warmth, socks are a fun accessory to complete my outfit. From no show liners to over-the-knee boot socks, from neon colors to wacky prints, from traditional to stripes…there are an infinite number of options.

Having options is essential as most adults (male and female) say they wear socks. The degree to which they wear socks differs, especially by gender. Seventy-three percent of men say they wear socks for all or most non-athletic activities compared to only 39 percent of women*. But when she is wearing socks, over 40 percent indicated they will coordinate their socks with their outfits all or most of the time**. And the weather plays a huge factor when it comes to women opening their sock draws, with 74 percent saying they wear socks when the weather turns colder*, present company included.

Close to 60 percent of total socks sales stem from the colder months of October through March, with nearly 20 percent solely in the month of December***. And stocking up on your favorite pair is considered the norm, as two-thirds of consumers say they buy multiple pairs of the same socks at one time*. I myself tend to go on sock buying binges once I realize last year’s pairs need replacing.

Not only am I buying socks for myself this time of year, I also find myself picking up a few pairs as holiday stocking stuffers. Moreover, socks are the number one gifted apparel item during the holiday season when looking at units****. But holiday sock gifting for me is more about playing up the novelty than the necessity…after all, print and patterned socks are growing in sales while solid colors are on the decline****. 

So, bye-bye bare feet (for now), and hello to a fun sock season ahead…or at least until the groundhog tells me otherwise.


*Source: The NPD Group, Inc. / Omnibus Aug 2016
**Source: The NPD Group, Inc. / Omnibus May 2016
***Source: The NPD Group, Inc. / Retail Tracking Service TMM- 12ME Sep 2016
****Source: The NPD Group, Inc. / Consumer Tracking Service- 2ME Dec 2015 & 12ME Sep 2016


November 17, 2016

Stores Closing on Thanksgiving? They May Want to Think Twice, Reports NPD

The average shopper spend on Thanksgiving Day 2015 was the 2nd highest of the whole year

Port Washington, NY, November 17, 2016 — The average amount spent by shoppers on Thanksgiving Day 2015 relative to other key shopping days may give pause to retailers, according to new The NPD Group, a leading global information company. A fifth of shoppers plan to do more of their holiday gift shopping online this year than they did last year*, but based on analysis from NPD’s receipt mining service, Checkout Tracking, there is also strong historical data indicating that there is value in stores keeping their doors open on Thanksgiving Day.

The eye-opening reality about the 2015 holiday shopping season is that, despite predictions of diluted and weak sales, Thanksgiving Day was the #2 ranked in-store shopping day of the year, based on the average amount spent per shopper on that day. Black Friday 2015 was ranked first. While the number of buyers in stores was less on both Black Friday (44 percent share of all 2015 buyers) and Thanksgiving (26 percent) than on the Saturday before Christmas (46 percent), the two November dates topped the charts in terms of shopping dollars spent.

“Though there are several retailers making the decision to close on Thanksgiving Day, enough consumers have demonstrated that they will shop on the holiday to make it worthwhile for most major retailers to open and capture those sales,” said Marshal Cohen, chief industry analyst, The NPD Group, Inc. “The value of getting a deal will always be a draw for a large segment of consumers. Now, retailers need to figure out how to get the attention of those shoppers, whether it is through timing of promotion, expanded store hours, or online flexibility and convenience.”

More than one in six holiday shoppers plan to wait until Black Friday sales to begin to their holiday gift shopping*. Indeed, looking at factors driving where consumers plan to shop this holiday season**, special sale price (62 percent) and overall value for the price (58 percent) lead the pack, but the strongest upward trajectory goes to free shipping offers—52 percent say such offers influence where they shop for holiday gifts, up from 44 percent in 2014. Additionally, three in ten holiday shoppers in America say they plan to buy all of their holiday gifts on sale this year.

“The data shows that holiday shoppers will go to one or two, maximum three stores on these big promotional shopping days. Retailers who want to connect with their customers and capture those sales will want to open on Thanksgiving, even for limited hours,” added Andy Mantis, executive vice president of Checkout Tracking at NPD Group. “This dilemma over whether or not to be open on Thanksgiving Thursday didn’t exist until recently. But now that it’s here, retailers have no choice but to figure out how to play in this space. With more than 25 percent of Black Friday two-day spend going into Thanksgiving, if you’re not in it, you risk losing customers and traffic.”  

*Source: The NPD Group, Inc. / October 2016 Omnibus

**Source: The NPD Group, Inc. / Annual Holiday Purchase Intentions Study


November 16, 2016

NPD Holiday Shopping Bag 2016 Weekly Report

NPD Will Report Weekly Point-of-sale Data for General Merchandise

Leading global information provider The NPD Group will be reporting weekly point-of-sale results for key general merchandise categories tracked by the company throughout the holiday season.  Categories included in the NPD “Holiday Shopping Bag” include Apparel, Toys, Technology, Athletic Footwear, and Prestige Fragrances.*

“The Census Bureau has reported improved retail sales with revisions to August and September, and October exceeded expectations with 0.8 percent growth.  NPD sees some categories showing signs of getting an early start for the holiday,” said Chief Industry Analyst Marshal Cohen.

Using real POS information, NPD is able to look at critical sales trends in order to report what consumers are actually purchasing during the holiday period and when they are purchasing enabling manufacturers and retailers to see what’s hot and what’s not as well as to understand the new cadence of holiday.

Week Ending November 5, 2016

Overall Performance

  • Dollar sales in the first week of November 2016 were 7 percent lower than they were in the first week of November 2015, driven by declines in both unit sales and the average price paid.
  • Technology is the largest segment but also has the largest declines from last year.
  • Prestige Fragrances are up slightly.
  • While dollar sales of toys were down slightly compared to last year, more items were purchased.

 

Top Performing Categories

  • Sport Leisure Shoes (Classics)
  • Games & Puzzles
  • Home Automation
  • Stereo Headphones
  • Outdoor & Sports Toys

“The season appears to be off to a sluggish start, in general, with technology and apparel at the top of the watch list, but the recent economic strength points to more positive results on the way,” said Cohen. “Promotions are kicking in earlier this year so sales may turn around quickly, especially for these top holiday segments.”

* Information is collected from a panel of leading retailers that provide weekly point-of-sale data covering in-store and online sales.


November 14, 2016

How Early is too Early for Christmas in Retail?

Is it some circadian rhythm, or do Christmas lovers set their clocks to November 1 at Midnight to start playing “All I Want for Christmas is You” and installing twinkle lights? Holiday fans and retailers alike have begun putting up Christmas displays right after Halloween.


November 14, 2016

It’s Beginning to Smell a lot like Christmas: Home Fragrance Most Important When Company is Expected, NPD Finds

Port Washington, NY, November 14, 2016 – In preparing their homes and minds for the holidays, and the festive family gatherings they bring, consumers turn to scent and décor to get into the holiday spirit. Home fragrance is most important to consumers when company is expected, as scents are a way of honoring their guests and ensuring they have a pleasant visit, according to Scentiments, a new suite of consumer insights and tools on the fragrance industry from global information company The NPD Group.

Nearly 50 percent of all home scent users use home scent “to create an inviting/comfortable atmosphere,” according to data from Scentiments. Women, with 84 percent of them using scented home products, are more likely to increase home scents when guests are expected, and men do this as well, though to a lesser degree. 

“As the upsurge in prestige sales and consumer statements attest, the home scents market is growing rapidly. This is a reflection of the consumer movement towards a different type of gift to self: more holistic sensory experiences,” said Karen Grant, global beauty industry analyst, The NPD Group. “Consumers tend to use candles, diffusers, and other scented home products not out of necessity, but out of a desire for a warm and intimate space that brings both the consumer and—especially during the holidays—their guests, comfort, joy, and positivity.”

In scenting the home, consumers tend to stick within their favorite scent families: sweet/fruity, tropical, food/baking, warm/woodsy, and clean/light. However, many will switch from one scent family to another on a seasonal basis. Nearly one-third of all home scent users say they change their home scent “when the seasons change.” This number skews even higher among older millennials, or 25-34 year olds, who are most likely to change scents seasonally. In addition, three-fourths of women in particular may use different scents in different rooms, illustrating not only the prevalence of scent in the home, but the importance of finding harmony and balance in scent combinations.

According to NPD’s retail tracking data, sales of prestige home scents spike in the fourth quarter of the year (October-December), coinciding with the holiday season. During November and December 2015, the top-selling home scent items based on units sold were: NEST Holiday Candle, Jo Malone’s Lime Basil & Mandarin Scent Surround Diffuser, and NEST Birchwood Pine Candle.  

Prestige Home Fragrance Unit Sales by Quarter 2015

 


November 3, 2016

NPDs Annual Home Holiday Gift Predictions 2016

NPD Highlights: Home for the Holidays

“The 2016 Holiday shopping season will be a happy one for the home-products industry,” said Joe Derochowski, executive director and home industry analyst, The NPD, Group, Inc. “Large, growing  portions of the population are hitting key life stages, so  marketing to these moments will be critical during the holiday season and beyond. Manufacturers and retailers who are able to address these key moments, especially with innovative products and thinking, will create excitement among holiday shoppers.”

Health continues to be a hot-button driven by Millennials and their parents – both groups are interested in health but for different reasons.  This opens up unique opportunities, including BOGO offers, for categories like…

  • Electric Kettles
  • Citrus Juicers
  • Blenders & Food Processing Systems
  • Portable Beverageware
  • Oral Care
  • Massaging Appliances

 

Creating an experience is critical for the growing number of pre- and post-kid households. As Millennials start their own homes and Boomers become empty-nesters, their new-found independence will have them entertaining more, and looking for more flexibility to customize to their own preferences, increasing the market demand for…

  • Barware Gadgets
  • Single-Serve Brewing Systems, Multi-Functional Coffeemakers, and Craft Coffee Brewers

 

Busy consumers are looking for convenience, and the aging population appreciates it too. Products that simplify everyday chores will see growth, so some of this year’s top gifts will be…

  • Robotic Vacuums
  • Stick Vacuums
  • Slow Cookers

 

Casualization isn’t just about fashion. Men that are expressing their style with a beard will be looking in their stockings for…

  • Men’s Facial Trimmers

 

 

For more information, or to speak with Joe Derochowski, please contact Janine Marshall, 516-625-2356 or janine.marshall@npd.com, and visit NPD’s Holiday Insights page.


November 2, 2016

Glad Tidings for Retailers This Holiday Season (Infographic)

“All signs point to a holiday retail season that will outperform last year’s,” said Marshal Cohen, chief industry analyst, The NPD Group. Here’s a look at what U.S. consumers are telling us about their holiday shopping plans.
November 1, 2016

Online is Closing the In-Store Gap in Holiday Shopping Reports NPD

An increasing number of online shoppers are likely to spend more than those opting to walk into a store

Port Washington, N.Y. – November 1, 2016 – Americans are increasingly turning to online shopping as a channel for their holiday season purchases. According to global information company The NPD Group’s 2016 Holiday Purchase Intentions Survey, 71 percent of consumers, and 79 percent of Millennials, plan to do some of their holiday shopping online this year.

“Online continues to change the game for retailers because it goes beyond convenience by bringing value and timing into the equation,” said Marshal Cohen, chief industry analyst, The NPD Group, Inc. “Brick-and-mortar retailers still have the benefit of drawing the majority of holiday shoppers with the in-store experience, but it is clear they are going to have to put their best foot forward in order to maintain a hold on Holiday 2016 and future seasons.”


Consumers aren’t just dipping their toes in e-commerce – they’re anticipating shopping more through online channels this year. Consumers anticipate doing an average of 38 percent of their holiday shopping online in 2016.

The online channels’ market share will likely be strongest among Millennials and Gen Xers, with each estimating they’ll do 42 percent of their holiday shopping online.

Those clicking their way through their holiday shopping lists will also be spending more: online shoppers anticipate spending an average of $710 this holiday season, roughly 60 percent more than the $440 those sticking with stores plan to spend.

Online shoppers will buy the same products as in-store shoppers (mostly), but with social input
Clothing/accessories, entertainment, and toys are the top ranked categories in both online and in-store segments, though – as might be expected – the tech/electronics category (ranked 4th among online shoppers) is a considerably lower priority among those avoiding e-commerce (ranked 7th).

Consumers are also going online to learn about the products they’re on the hunt for. Among those who will research products this holiday season, over seven in 10 plan to do online research and nearly half expect they’ll look at consumer reviews. One in four anticipate utilizing social media (higher among Gen Z: 43 percent, and Millennials: 38 percent), while 14 percent plan on using mobile apps.

Holiday shoppers are picking up their phones
Mobile apps won’t just be used for product research. More mobile phones will be coming out of consumers’ pockets to shop this holiday season: 14 percent of U.S. shoppers – including 29 percent of Millennials – say they’ll use their mobile phones to buy gifts this year. This may not be a staggering number on its own, but it’s up more than 130 percent from last year.

“We are at a point where retail must embrace the online shopping culture, not just try to battle it, especially during the critical holiday shopping season,” added Cohen. “There are opportunities to be had in the relationship between brick and click – maximizing the emotional component of shopping in-store, while utilizing the convenience and flexibility of shopping online will create a complete shopping experience for the consumer and a happy year-end for retail.”


November 1, 2016

Toys Tied to Experiences, Family Time, and Healthy Living Propel Industry Growth through the Holiday Season

NPD forecasts growth of approximately 6.5 percent for U.S. toy industry in 2016

Port Washington, NY, November 1, 2016 – U.S. toy sales grew by 6 percent from January through September 2016, according to retail sales data from global information company The NPD Group. NPD expects several trends to drive the toy industry to continued growth through the remainder of 2016, including consumer movement towards experiential purchasing, the popularity of collectibles, the drive toward healthier living, and higher price-points during this holiday season. For the year, NPD estimates toy sales to be up approximately 6.5 percent.

Games and Puzzles the fastest-growing supercategory thus far in 2016

Seven of 11 toy supercategories have posted year-over-year growth through September. Of the seven, the fastest growing is Games and Puzzles, up 16 percent, followed by Dolls and Action Figures & Accessories, both up 12 percent. Within Games and Puzzles, every type of game is fueling growth, from family strategy and board games, to brainteasers and adult games, as well as preschool games. With the Pie Face Game and UNO Card Game both among this year’s top 10 selling items year-to-date, it is highly likely that toys tied to family fun experiences will be on many people’s wish list this holiday season.

“The trend in games is definitely one to watch, and it will continue to flourish as families look for more together time,” said Juli Lennett, senior vice president, U.S. toys industry analyst, The NPD Group.

U.S. Toys Supercategory Performance
Dollar Change, January-September 2016

U.S. Toys Supercategory Performance

Collectibles likely to be big this Christmas

The collectibles craze has built significant momentum heading into the fourth quarter. Sales of collectibles, which fall under playset dolls and action figures, were up 64 percent, or over $220 million, through September. Approximately one-quarter of the $220 million is tied to blind bags, which are estimated to have grown about 80 percent so far this year.

“Within collectibles, there are a lot of new choices, and blind bags especially will make great stocking stuffers this Christmas. Looking at all the new collectibles and blind bags launched this fall, I expect continued strong growth of this segment,” said Lennett.

Healthy living is hot, even in the cooler months

The healthy living trend is a likely growth driver in many non-toy categories NPD tracks, from athletic footwear and activewear, to digital fitness and fresh food consumption. It is also tied to 9 percent year-to-date growth in Outdoor & Sports toys, the largest toy supercategory with dollar sales representing about a quarter of all toy industry sales. On a dollar-basis only, Outdoor & Sports is the industry’s strongest growing thus far in 2016.

“I believe some of this explosion in Outdoor & Sports is a result of millennials seeking a healthier, outdoor lifestyle for their kids,” said Lennett. “I expect that the healthy living trend will continue, and it will be important for toy companies to engage with this trend, and look for ways to do so even in the fall and winter months.”

Higher-priced items will brighten growth this holiday season

While collectibles such as blind bags may be popular stocking stuffers, higher-priced toys are likely to be the presents wrapped under the tree this holiday season. Items including the Star Wars Sphero App Controlled BB-8 and Star Wars Millennium Falcon are among the top 10 toys year-to-date, while the newly-released Hatchimals, an interactive toy that hatches from an egg, which released on October 7, was already among the top five best-selling toys for the week ending October 8, 2016.

“The categories that I expect will provide the most growth in November and December will be connected toys, including drones, cars, and robotics; and wheels, such as battery operated ride-ons, scooters, and hoverboards,” said Lennett. “In prior years, there were one or two hot toys for holiday, but today there is not any one item. While this may create competition for manufacturers, it also presents many opportunities to grow the toy industry in the fourth quarter.”

In terms of how holiday shopping will play out this season, Lennett says, “I believe we will see a stronger December this year because there are two extra shopping days between Thanksgiving and Christmas 2016 over 2015, and one of those extra shopping days is a Saturday. As we saw from toy purchases last year, consumers were out in full force the week before and the week of Christmas. I expect to see this last minute shopping behavior for toys again this year.”

Source: The NPD Group, Inc. / Retail Tracking Service, January-September 2016 vs. 2015
Data is representative of retailers that participate in The NPD Group’s Retail Tracking Service. NPD’s current estimate is that the Retail Tracking Service represents approximately 80% of the U.S. retail market for Toys.


November 1, 2016

Baker’s Dozen + 1: Stephen Baker’s Top Holiday 2016 Expectations

NPD Highlights: Consumer Tech for the Holidays

  1. PC holiday revenues revived – Sales will be the best in at least four years, as average sales prices  rise
  2. iPad Pros deliver big – Expect revenue increases for  Apple tablets, while Android consumer interest wanes
  3. Smartphone sales soar – New iPhones will exceed market expectations and drive the best smartphone market in years
  4. Cutting the (headphone) cord continues – Wireless headphones will be on many holiday shopping lists this year
  5. Online sales will not falter – Online revenue will account for as much as 33 percent of consumer electronics holiday sales
  6. Procrastinators rejoice – Latest sales holiday in years, as consumers will wait until the last minute to finish up shopping
  7. Cyber week sales struggles – With retailers offering aggressive promotions in-store and online the week of Thanksgiving, Cyber Monday and the week that follows will see challenges to keep up with Thanksgiving retail volumes
  8. No Black Friday surprises – Once again, TVs will dominate Black Friday (and, in fact, all of Thanksgiving Week)
  9. Wearables wear thin – While prices for wearables may begin to decrease (especially in the fitness segment where competition is growing), expect a slight slowdown in sales as consumers  interest fades
  10. 4K TV, the bigger the better 4K TVs, led by sales of screen sizes 55” and over, will account for six in every 10 holiday TV dollars spent
  11. Drone sales take to the sky – Interest and revenue peak as the available market expands
  12. VR is lukewarm – VR will elicit a tepid response from consumers
  13. Electronics gain a voice of their own – Voice enabled device sales will grow, as voice becomes a more important attribute this holiday

Baker’s Bonus: Strong TV unit sales will continue throughout the holiday season - extending the surprising demand increases we have seen thus far in 2016

 

“While sales trends have improved for many fundamentals of the consumer electronics market this year, holiday sales are always uncertain, especially in the largest categories such as TVs, phones and tablets,” said Stephen Baker, vice president, industry analyst at NPD. “2016 is no different than years past, but with recent new product introductions and categories like drones set to takeoff, we expect improvement in results from the 2015 holiday season.”


October 20, 2016

The Holiday Political Split-Screen (Infographic)

Election season is getting down to the wire, and the holiday season will begin in earnest soon after. What do Clinton and Trump supporters think about the weighty issues surrounding the 2016 holiday season? Whose supporters show more fiscal responsibility when it comes to their annual holiday shopping? Who’s more focused on getting the best deals? What will they buy?
October 17, 2016

A Political Holiday Split Screen

We’ve heard a lot – and are about to hear more – about how the Democratic and Republican presidential nominees feel on a wealth of issues. But what do their supporters feel about the weighty issues surrounding the 2016 holiday shopping season? And do their attitudes about holiday shopping tie back to the messages their candidate will likely be voicing during the final debate on October 19, 2016?    

Debt and government overspending are time honored election themes but whose supporters show more fiscal responsibility when it comes to their annual holiday shopping?

On the economy: Out of the gate, Trump supporters are more likely to say that the state of the economy will have a “significant impact” on their holiday purchases this year (15% of Trump supporters, vs. 11% of Clinton supporters).

On spending: Democrats are often accused by their political rivals of overspending and driving up the national debt, and echoes of this narrative can be seen to some degree among Clinton supporters’ spending habits and plans. Clinton supporters are more likely than Trump supporters to say they plan on spending more this holiday season than in 2015 (15% of Clinton supporters vs. 11% of Trump supporters), despite the fact that they’re also more likely to still be paying off debt from the last holiday season (23% of Clinton supporters vs. 17% of Trump supporters).

On budget cuts: As for getting the best deals, Trump supporters are more likely to identify special sale prices (64% of Trump supporters vs. 58% of Clinton supporters) and overall value for the price (62% of Trump supporters vs. 54% of Clinton supporters) as factors that will influence where they shop for the holidays this year.

 

Analyzing the results

Even this year’s intense election cycle has done little to dampen consumer confidence going into the holiday season, which we forecast to grow moderately.

And while there are significant differences between the presidential candidates, there is very little difference in how each of their supporters plans to approach their 2016 holiday shopping. Although marketing to Trump and Clinton supporters separately isn’t necessary, marketers do need to pay attention to the distraction this election is for consumers and how it will impact their shopping behavior, at least in the short term.  Retailers will need to find ways to break through the noise surrounding the election and be innovative in marketing to consumers. The best way to get the attention of the distracted is to give them a great deal. They’ll be back regardless of who wins the election. 

 

Source: The NPD Group, Inc. / Annual Holiday Survey


October 10, 2016

Glad Tidings for Retailers This Holiday Season

Anticipated holiday spending on the rise; Two in 10 consumers have already started shopping for the holidays

Port Washington, N.Y. – October 10, 2016 – Retailers should have plenty to be thankful for in the coming holiday season. According to global information company The NPD Group’s 2016 Holiday Purchase Intentions Survey, consumers plan to spend an average of $636 on holiday-related expenses, up 3 percent from what they anticipated last year.

When questioned more broadly, 14 percent of consumers plan to spend “more” than they did during last year’s holiday season and 17 percent say they’ll spend “less” – virtually unchanged from 2015 results. Consumers are also less concerned about the economy spoiling their holiday fun: when asked how the state of the economy will influence their holiday purchases in 2016, the 12 percent saying it will have a “significant impact” is down from recent years (14 percent in 2015, 19 percent in 2014).

“All signs point to a holiday retail season that will outperform last year’s,” said Marshal Cohen, chief industry analyst, The NPD Group, Inc. “The unvarying holiday spending intentions expressed by consumers are a sign that even this year’s intense election cycle has done little to dampen consumer confidence going into the holiday season, which we forecast to grow moderately.”

Best laid plans

Planning to spend less and actually tightening the purse strings are hardly one and the same. Case in point: 16 percent of consumers were planning on cutting back during the 2015 holiday season, but more than 20 percent of consumers reflected that they actually spent more than they’d planned on their 2015 holiday purchases.

Some may be more determined than others to keep their spending in check this year – particularly those still dealing with the ghosts of holiday purchases past. More than half (57 percent) of consumers used credit cards for at least some of their holiday season purchases last year, of whom 22 percent still have at least some of that debt hanging over them. In the end, over a quarter of those still paying for their last year’s holiday purchases say they’ll spend less on Holiday 2016. 


Growth across purchase channels and product categories 

Retailers with online purchase channels stand to gain, as consumers plan on shopping more through online channels this year. On average, shoppers plan on doing 38 percent of their holiday shopping online (up from 33 percent last year and 29 percent in 2014).

Looking more specifically at where consumers plan to shop during the 2016 holiday season, growth is apparent across the marketplace, from online-only “e-tailers” to toy stores to specialty retailers in the beauty category (and most other purchase channels in between):

 

A similar rising tide is evident looking at what consumers expect to buy this holiday season. Though outlooks vary among individual products (for example, purchase intent for movies/DVDs, music, and video games/ systems are all unchanged from 2015), aggregated product “supercategories” all show rising interest:

 

“Consumer response is suggesting growth across retail channels, despite the growth and dominance of online shopping, which points to a sense of optimism,” said Cohen. “The lack of stand-out, must-have products this holiday season is benefiting the categories that are delivering on basic consumer wants, but marketers need to find new ways to engage and excite holiday shoppers to drive significant growth.”

Off to the races

Two in 10 consumers have already started their holiday shopping, and how early – or late – they kick things off can tell us a great deal about their shopping habits and plans.

For starters, earlier shopping correlates with bigger spending. Twenty-seven percent of heavy spenders (those planning to spend $750 or more) have already started shopping; this drops to 24 percent among midlevel spenders ($300-$749) and 17 percent among low spenders (<$300). None of this should be taken to mean that early shopping causes higher spending – from a causal standpoint, those with longer lists are more likely to feel a need to get an early start.

Just because they’re spending more, doesn’t mean they’re not spending carefully. Early shoppers are more likely to say they comparison shop before they buy gifts (45 percent vs. 30 percent of late shoppers) and that they plan on buying all their holiday gifts on sale (38 percent vs. 21 percent of late shoppers).

Oh, and in all the last minute rush, late shoppers may not have time to pick up a little something for themselves – they’re less likely than their early shopper counterparts to say that when they shop for others, they also shop for themselves (15 percent vs. 26 percent of early shoppers).

What holiday fatigue?

While there may be cynics among us, six in 10 consumers are looking forward to the holiday season, and nearly half say the simple act of going out shopping during the holidays puts them in the holiday spirit.

“Consumers are ready to spend this holiday season. However, more than ever before, how much they spend will be determined by their own perception of the products and promotions they are presented with, rather than the simple fact that the products and promotions are there,”  added Cohen.

Methodology

The Holiday Purchase Intentions Survey is designed to better understand consumers’ shopping and spending intentions for the upcoming holiday season. An online survey was fielded in September, 2016 among a US representative sample of NPD online consumer panel members. The survey was completed by 3,499 individuals aged 18 and older. 


September 21, 2016

Election Distraction

With less than two months to go until the 2016 presidential election it is as if the circus has come to town. Regardless of your political affiliation, there is no denying that this presidential election year is unlike any in recent history. Presidential elections typically distract consumers and less of their attention is paid to spending, but this year the distraction is likely going to be bigger than ever. 

While elections are one of the many factors that can impact retail sales, looking at the U.S. Census Bureau’s Annual Retail Trade Report for 1992 through 2014, there is evidence of some spending shifts in election years and the first year of a new presidency. Retail spending growth slowed from 9 percent to 6 percent in 2000, and then to 3 percent when George W. Bush took office in 2001, according to the report. Spending began a decline in 2008 and continued into 2009 when Barack Obama became president. The excitement, uncertainty, and general fanfare around U.S. presidential elections are generally the cause for consumer distraction.

My opinion is that the distraction caused by this year’s presidential election will be felt by retailers big and small. The debates alone will cause a disruption in spending, as people tune-in and shift their focus from some of their usual behavior to the debates. Some of the resulting sales loss will be made up, but it will be difficult to recover valuable impulse purchases. The loss of impulse spending during a presidential election is significant for the U.S. apparel industry since unplanned purchases account for 29 percent of annual dollar sales*. 

The question is will the eight weeks of the holiday shopping season be enough opportunity to recapture the losses from election distraction? The answer is that holiday shopping is enough of a distraction to recapture consumer attention, but retailers will need to work at it. They’ll need to merchandise innovative products, offer meaningful promotions, and spread out stock replenishments throughout the holiday shopping season.  In other words, the key is to turn a distraction into an attraction.

*Source: The NPD Group, Inc. / Consumer Tracking Service, 2015


December 7, 2016

Makeup Is Seen Taking Over Holiday Beauty Sales, as Consumers Spend More on Themselves

Blame it on the selfie. At a time of year when fragrance typically reigns supreme, cosmetics are giving the popular gifting item — which accounts for half of beauty sales in December — a run for its money. In the 10 months prior to the holiday shopping period, consumers were scooping up enough contouring kits, lip stains and other cosmetics to push prestige makeup sales 12 percent higher, to $5.9 billion, according to The NPD Group. That's on top of last year's 13 percent gain over the same peri...


December 3, 2016

Socks Are the Only Clothes You Should Give This Holiday Season

Socks—yes, socks—are an incredibly popular holiday gift. According to research firm The NPD Group, they are the item of clothing given the most to men or women in the US for Hanukah or Christmas. Admittedly, socks might not stir our passions the way expensive jewelry or electronics do. But maybe that’s because when we give them, we prioritize the wrong qualities. We think of them as a necessity rather than a luxury. But the real gift that socks can offer, if you buy the right ones, is amazing co...


December 1, 2016

4 Changes Shoppers Will See as they Buy on Their Phones

Visiting Stores For Different Reasons: Even people who'd bought lots of items on their phones were spending time in stores on Saturday and Sunday, said Marshal Cohen, chief industry analyst at research firm The NPD Group Inc. "In the past, consumers did their research online and then purchased in-store, but brick and mortar stores are now critical to consumers' research needs," he wrote in a blog post. He said "consumers came and bought, impulsively and socially."...


November 27, 2016

You Know What Kids Need Today? Their Own Teslas

Sports cars, Jeeps, trucks and carriages for youngsters are expected to be among the top-selling holiday gifts this year. Sales of battery-powered ride-on cars overall in the U.S. reached $430 million last year and so far this year are up 7.1 percent, said Juli Lennett, U.S. toy industry analyst for market researcher The NPD Group....


November 26, 2016

Thanksgiving, Black Friday Store Sales Fall, Online Rises

Consumers are expected to spend $636 on average on holiday purchases this year, up 3 percent from their 2015 spending plans, according to NPD. "Stores that opened on Thursday were not very busy on Black Friday...and while the Thanksgiving Day opt-outs were busier on Black Friday, they didn't see the crowds they saw in previous years," NPD group's Chief Industry analyst Marshal Cohen said. ...


November 25, 2016

On Black Friday, Teens Prioritize Bargains Over Brands

U.S. teens between the ages 13 and 17 spent $18.8 billion on apparel in the 12 months ending October, a 2 percent decline from the prior year, according to market researcher The NPD Group. Total U.S. apparel spending increased 3 percent in the same period, to $218.7 billion. "The younger consumer cares more about what they do than what they wear,” said Marshal Cohen, an analyst at NPD. “They are more interested in sharing the experiences they have.”...


November 25, 2016

Black Friday Merchants See Americans Exhaling After Election

Now that Election Tuesday is over, retailers are counting on Americans turning their attention to Black Friday. That would be a welcome development for merchants that have yet to see a sales bump materialize. Dollar sales in the second week of November were 8 percent lower than in the same period a year earlier, according to research firm The NPD Group. The decline was broad-based, too, with drops in apparel, toys, technology, athletic footwear and perfumes, the firm said....


November 24, 2016

CT-Major Retailers Buck Trend of Opening on Thanksgiving

Watch Marshal Cohen’s Thanksgiving Day appearance on MSNBC Live with Stephanie Ruhle, sharing insights on Thanksgiving Day shopping, Black Friday, holiday bargains, self-gifting, election-related retail therapy, and more!...


November 22, 2016

Ahead Of The Pack, Patagonia Goes All In For Planet

While activewear is currently in something of a slump, according to The NPD Group, “sales at Patagonia are strong,” Matt Powell, its sports industry analyst, tells Marketing Daily. “For the third quarter, sales of most outdoor activewear declined.” ...


November 11, 2016

Shopping for the Holidays? These Are 14 of the Hottest Toys of 2016

It's going to be a happy holiday for the toy industry this year. The industry, which had its best year in more than a decade last season, is slated to grow 6.5 percent in 2016, propelled by "Star Wars," collectibles and tech toys, according to the NPD Group....


November 8, 2016

Thanksgiving Day Shopping Is Here to Stay With Some Tweaks

Andy Mantis, executive vice president of The NPD Group's Checkout Tracking, says stores should open on both Thanksgiving and Black Friday to maximize their sales. The company, which analyzes receipt data to understand consumer behavior, found that the share of buyers who shopped on both days declined, while the number who shopped only on Thanksgiving Day or on Black Friday increased. Mantis believes specialty retailers, especially those near big stores like Macy's that are open, should think aga...


November 7, 2016

Hatchimals Are Among This Season’s Hottest Toys — But Good Luck Getting Your Hands on Them

And they could be the “the Tickle Me Elmo of 2016,” says Juli Lennett, the U.S. toys industry analyst for The NPD Group. “For the last four years (2013-2016), there has been nothing comparable to the instant sales success within weeks of launch as Hatchimals,” Lennett told the Daily News through a publicist. “The closest comparable new launch of a property would be Disney ‘Frozen’ in 2013 which had a movie tie-in. Hatchimals is off to an even stronger start than Disney ‘Frozen.’” ...


November 3, 2016

Housewares Will Be High on Holiday Wish Lists

Consumer trends among certain demographic groups should make this year’s holiday season a strong one for housewares product categories, according to an analysis from The NPD Group. Among the “hot buttons” for holiday shoppers cited by the research firm is health, which should be a gift-giving driver for both Millennials and their parents, NPD said. ...


November 2, 2016

This Election Is So Nuts, Some Consumers Can't Be Bothered With Shopping

Retailers have begun ushering in big deals ahead of Black Friday, but with the countdown to the presidential election intensifying, consumers aren't as interested in shopping as they normally would be this time of year. "The consumer doesn't want to rush, but the retailers can't wait to begin the holiday sales, which they have," said Marshal Cohen, retail industry analyst at The NPD Group. "It's a push/pull factor that creates a disparity between retail and consumption — which only gets retailer...


November 2, 2016

Millennial Shoppers Say They're Ready to Spend This Holiday. But Skeptics Aren't So Sure

As the holiday shopping kicks off, the retail world is paying close attention to Millennial consumers, who say they’ll increase spending this year. But the proof will be in the Christmas pudding. The data we shared with reporters shows a trend that doesn’t bode well....


November 2, 2016

This Year's Hot Holiday Toy May Have Just Hatched

Attention, parents. Consider yourself warned: It looks like we have the makings of a holiday toy craze on our hands. "For the last four years, there has been nothing comparable to the instant sales success within weeks of launch as Hatchimals," Juli Lennett, U.S. toys industry analyst at The NPD Group, told CNBC....


October 26, 2016

Vast Group of New Video Games and Hardware Jostle for Holiday Attention

Figuring out what to get for your video gamer friends and relatives this holiday season is about to become a lot more complicated. The choices might be made even more complicated by the question of whether to buy a game title or just rent it. The NPD Group, a research firm that tracks retail sales in the United States, is projecting an increase in spending on rental games from services like GameFly and Redbox, as more people opt to try titles before they purchase....


October 18, 2016

Consumers Will Spend Almost $800 Billion on Holiday Shopping

"Once the election distraction is over, we kind of get back to normal, and nothing cures the uneasiness of a crazy election better than a great sale," said Marshall Cohen, chief industry analyst with The NPD Group. According to The NPD Group's 2016 Holiday Purchase Intentions Survey, stronger holiday spending intentions - up three percent from last year - are a sign that even this year's intense election cycle has done little to dampen consumer confidence going into the holiday season....


September 26, 2016

How the Presidential Election is Distracting Holiday Shoppers

The anxiety weighing on the consumer psyche is expected to hurt retailers in the short run, with Marshal Cohen, chief industry analyst at The NPD Group, predicting that the election will become a bigger distraction for shoppers after the first debate held on Monday night. “I would suspect because of circus nature, the absurdity, the amount of coverage between social media, online print, the distraction will be bigger [this year],” he told Retail Dive....


Check back each week for more holiday insights, including...
  • Highlights: Beauty Holiday Outlook
  • How Will Holiday Debt and Cash Spending Impact the 2016 Holiday Shopping Season?
  • NPD Holiday Shopping Bag 2016 Weekly Report – leading up to Thanksgiving, and through the end of 2016
  • What will be in fashion this holiday shopping season?

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