The morphing of New England’s trees from verdant greens into russet hues gives retailers permission to put away the summer sundries.
It also signals that the holidays are fast approaching.
The holiday season is an important one for retailers in most countries.
But it is doubly so in America, mostly thanks to the concertinaing of three massive spending occasions – Thanksgiving, Black Friday and Christmas – into a short period of time.
Across these events, Americans will spend a whopping $269.3bn on retail.
For Thanksgiving alone, retailers will sell more than 52 million pies – a large proportion of them pumpkin-flavoured.
This immense scale has always been part of holiday retail, and will likely remain so.
What does change is the fortune of each holiday season in terms of the growth generated and the winners and losers it leaves in its wake.
As it comes after a highly contentious election, this holiday season is being watched closely.
However, as evidenced by past cycles, the vote and its outcome have relatively little bearing on holiday spending.
With the new President not taking office until January, the economic realities for American consumers do not change all that quickly.
Even so, this holiday season will be one of churn and change.
“Black Friday is struggling, consumers’ shopping habits are changing, and the polarisation between retail winners and losers is becoming sharper”
Overall growth will be reasonable enough, with our forecasts indicating total spending will rise by 3.1%.
This is helped by a relatively benign economic backdrop, with some favourable tailwinds from low unemployment, low inflation, and some modest gains to income.
Yet under this headline, the dynamics of the holiday are shifting.
Black Friday is struggling, consumers’ shopping habits are changing, and the polarisation between retail winners and losers is becoming sharper.
This year, we forecast that Black Friday spending will grow by a meagre 1.9%.
The occasion is a victim of waning consumer interest brought about by ever higher levels of year-round discounting and promotional activity.
For many Americans, the idea of rushing to the mall and battling the crowds to save a few dollars does not hold the appeal it once did – one of the reasons why we predict footfall to physical locations will be down by over 10 million compared with last year.
The dip in footfall, across both Black Friday and the holiday in general, is also a function of changing patterns of consumption as more shoppers go digital.
“From our data the clear winner this year is Amazon, which is set to see the number of customers using it for holiday buying rise by over 11 percentage points”
Admittedly, online penetration in the US is far less impressive than in the UK – with just 6.6% of holiday spend set to be made online – however, the proportion is growing and it is causing pain for many traditional retailers.
That leads to the final point.
With lower growth, holidays are now more of a zero sum game with winners and losers.
From our data the clear winner this year is Amazon, which is set to see the number of customers using it for holiday buying rise by over 11 percentage points.
Value and discount stores will also make gains, with collective customer share projected to rise 9.9 points.
In contrast, department stores will lose almost six points of shopper share.
In short, this year will be a happy holiday… but, in retail, only for some.
- Neil Saunders is managing director of Conlumino