Source: bibiphoto/ Shutterstock.com
This holiday season, discount retailers like T.J. Maxx, Burlington, and Ross Dress for Less are projected to lead the retail race, capturing the interest of shoppers who are scaling back on their budgets. Analysts point to economic factors and rising costs of essentials that are putting a squeeze on holiday spending. As consumers adjust, they’re expected to prioritize stores that offer the best value, meaning discounters may see a surge in foot traffic.
Department stores are likely to struggle as they attempt to meet the growing consumer demand for value without the deep discounts that stores like Burlington and T.J. Maxx are known for. The demand for value and fresh inventory is particularly high as consumers face tighter budgets this holiday season. With just 27 days between Thanksgiving and Christmas, the shorter shopping season intensifies the pressure on retailers to attract shoppers quickly and effectively.
While high-ticket items like electronics may see slower sales, apparel and affordable luxury items are expected to fare well. Brands like Deckers’ Hoka, On Holding, and Skechers are expected to maintain robust momentum due to their innovation and brand positioning, even outpacing popular competitors like Nike. Meanwhile, categories such as gift cards, media, and more accessible electronics are forecasted to stay in demand as practical, budget-friendly gift options.
Retailers with a heavy reliance on foot traffic, such as Bath & Body Works and Five Below, face the dual challenge of a shortened season and consumers’ conservative spending. Bath & Body Works, for instance, has issued a conservative forecast, expecting to rely on strategic promotions to draw shoppers. Nevertheless, these physical stores hold an advantage over online retailers, given the anticipated constraints on shipping capacities. United Parcel Service informed that tighter shipping windows may nudge shoppers toward in-store purchases to avoid delivery delays.
Looking forward, retail giants such as Walmart, Target, and Macy’s are expected to reveal more on holiday forecasts in their upcoming earnings calls. The National Retail Federation projects a modest growth rate for holiday spending, estimated at 2.5% to 3.5%, bringing total holiday sales between $979.5 billion and $989 billion. This growth, although positive, lags slightly behind the 3.9% increase recorded last year, underscoring a more cautious consumer mindset.
Ultimately, this holiday shopping season will see retailers vying to entice budget-conscious shoppers, balancing the desire for full-price sales with the pull of discounting. It’s a “game of chicken” between consumers waiting for deals and retailers eager to maintain margins, with discounters expected to come out ahead in this tug-of-war for holiday sales.
Source: bibiphoto/ Shutterstock.com
This holiday season, discount retailers like T.J. Maxx, Burlington, and Ross Dress for Less are projected to lead the retail race, capturing the interest of shoppers who are scaling back on their budgets. Analysts point to economic factors and rising costs of essentials that are putting a squeeze on holiday spending. As consumers adjust, they’re expected to prioritize stores that offer the best value, meaning discounters may see a surge in foot traffic.
Department stores are likely to struggle as they attempt to meet the growing consumer demand for value without the deep discounts that stores like Burlington and T.J. Maxx are known for. The demand for value and fresh inventory is particularly high as consumers face tighter budgets this holiday season. With just 27 days between Thanksgiving and Christmas, the shorter shopping season intensifies the pressure on retailers to attract shoppers quickly and effectively.
While high-ticket items like electronics may see slower sales, apparel and affordable luxury items are expected to fare well. Brands like Deckers’ Hoka, On Holding, and Skechers are expected to maintain robust momentum due to their innovation and brand positioning, even outpacing popular competitors like Nike. Meanwhile, categories such as gift cards, media, and more accessible electronics are forecasted to stay in demand as practical, budget-friendly gift options.
Retailers with a heavy reliance on foot traffic, such as Bath & Body Works and Five Below, face the dual challenge of a shortened season and consumers’ conservative spending. Bath & Body Works, for instance, has issued a conservative forecast, expecting to rely on strategic promotions to draw shoppers. Nevertheless, these physical stores hold an advantage over online retailers, given the anticipated constraints on shipping capacities. United Parcel Service informed that tighter shipping windows may nudge shoppers toward in-store purchases to avoid delivery delays.
Looking forward, retail giants such as Walmart, Target, and Macy’s are expected to reveal more on holiday forecasts in their upcoming earnings calls. The National Retail Federation projects a modest growth rate for holiday spending, estimated at 2.5% to 3.5%, bringing total holiday sales between $979.5 billion and $989 billion. This growth, although positive, lags slightly behind the 3.9% increase recorded last year, underscoring a more cautious consumer mindset.
Ultimately, this holiday shopping season will see retailers vying to entice budget-conscious shoppers, balancing the desire for full-price sales with the pull of discounting. It’s a “game of chicken” between consumers waiting for deals and retailers eager to maintain margins, with discounters expected to come out ahead in this tug-of-war for holiday sales.
