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Holiday Sales Surpass Forecasts, Reflecting Consumer Rebound

Accelerating rapidly after a decade of mediocre growth, retail spending growth is seeing its best performance since 2005, with widespread gains both in stores and online, across all major formats, according to longtime retail researchers Customer Growth Partners.

Based on CPG’s primary research tracking America’s 50 largest retailers through field surveys across benchmark shopping venues nationwide for the holiday period, consumers are spending at a pace not seen since before the recession. Drawing on results of the November-December research CGP estimates that total holiday spending reached a record $672 billion, fractionally above CGP mid-December forecast of $671 billion, a 5.7% year-0ver-year increase. [CGP’s forecast excludes autos/parts, gasoline/fuel oil, and restaurants. Estimates are based on detailed shopper surveys at over 50 of the nation’s 50 largest retailers, conducted in over 90 benchmark mall and off-mall shopping venues.]

With the holiday results boosted by record sales in the Christmas to New Year’s week — retail’s “Second Season” — the robust spending is evident across all demographics, not just upper income quintiles. Holiday 2017 showed broad-based momentum across the board: across all demographics, all major merchandise categories, across formats from big-box to specialty, and across channels — whether online or in-store. With the broad-based sales growth and rising real disposable incomes — and now the new tax cut legislation — all the ingredients are in place for a sustained rebound in consumer spending well into 2018 and perhaps beyond.

Holiday sales were paced by:

• Online/direct-to-consumer sales: up 11.7%
• Home improvement: up 9.5%
• Off-price stores: up 8.4%
• Superstores/clubs: up 5.6%
• Apparel: up 5.1%

Not all retail sectors thrived, however, with women’s apparel retailers and sporting goods seeing sluggish sales at best. Department stores, while far lagging peak performance levels of many years ago, accelerated strongly from prior dismal results, with improved same-store-sales seen at many stores — albeit enabled by multiple store closures.

The hottest products of the season include:

• Apple’s iPhone X, iPhone 8-Plus, Air-Pods and Series 3 Watches
• Nintendo Switch
• Microsoft’s X Box One-S
• WowWee’s Fingerlings—near-impossible to find, with new shipments before Christmas
• Squishies (multiples sources)
• Spinmaster’s Hatchimals, Air Hog drones, and PAW Patrol Lookout Tower
• Hasbro’s NERF and Star Wars/Last Jedi toys
• Sweaters (perennially the top gift item)
• Biggest self-gifting items:  women’s boots and ripped jeans.

Holiday 2017 turned out to be a home run, with results far better than consensus expectation. This Christmas may well mark the beginning of a very strong and sustained consumer-led recovery — and this was before most consumers focused on the new tax cuts. After years in hibernation, consumers — accounting for 70% of GDP — are flexing their spending muscles. In short, the coming consumer boom is already here.

Craig Johnson is president of Customer Growth Partners,  a consulting and research firm serving the retail industry.  Founded in 2001, CGP conducts both proprietary and public forecasts of annual, back to school and holiday retail sales.

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Two retail no-shows on TV this past holiday season

BY Marianne Wilson

In an unusual move for a big national chain, Sears Holdings pulled a disappearing act on television during the just-passed holiday season.

The embattled retailer has not run any commercials on national television for its namesake or Kmart brands since late November, according to ad research firm iSpot. By comparison, Macy’s bought $32 million in national TV ads during the first 29 days of December, and J.C. Penney spent roughly $27 million, iSpot estimates indicate.

The lack of TV advertising during the retail industry’s most crucial selling season is being seen as highly unusual, even in today’s digital age, and was seen by some observers as a sign of Sears’ ongoing financial troubles. However, in a statement to The Wall Street Journal, which first reported the move, Sears said it is constantly “evaluating the effectiveness” of different marketing venues.

“This ongoing evaluation has meant we have made significant shifts over the past few years in where we’ve allocated our resources, including less traditional print and television, and more digital and social channels,” the statement added.

The decision, according to the Journal, came from Sears CEO Edward Lampert, over the objections of other executives.

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Walmart reveals top online sellers of 2017 by state

BY CSA Staff

New Yorkers love Cheerios. People in Nevada buy a lot of dog treats, while the residents of New Mexico are most inclined to buy cat food. A Green Bay Packers bath mat is a top seller in Wisconsin.

Interested in finding out how buying habits differ by state, Walmart took a look at the top 25 most popular items purchased on its web site in each state and used the findings to identify interesting top sellers. Although common items such as water, paper towels, and dry goods were popular online across the board, there were some unique trends.  Here is a look at the Walmart list:

• Alabama: Crayons• Alabama: Crayons
• Alaska: RV & marine antifreeze
• Arizona: L.O.L. Surprise! Dolls
• Arkansas: Chocolate
• California: Protein powder
• Colorado: Peanut M&M’s
• Connecticut: ‘Ghost in the Shell’ DVD
• Delaware: Spiced jelly candy
• Florida: Sparkling cider
• Georgia: Fisher-Price Laugh & Learn Smart Stages Chairs
• Hawaii: Barbie farmer doll
• Idaho: My Little Pony Mini Collection
• Illinois: Erasers
• Indiana: Instant coffee
• Iowa: Water softening crystals
• Kansas: Ozark Trail tumblers
• Kentucky: 4×6 photo prints
• Louisiana: Root beer extract
• Maine: Brownies
• Maryland: Glue sticks
• Massachusetts: Refrigerators
• Michigan: Lavender-scented cleaning products
• Minnesota: Flamin’ Hot Cheetos
• Mississippi: Oil-less fryer
• Missouri: Life Savers
• Montana: Madden NFL video games
• Nebraska: Pressed makeup powder
• Nevada: Dog treats
• New Hampshire: Cinnamon-flavored toothpaste
• New Jersey: Pool salt
• New Mexico: Cat food
• New York: Cheerios
• North Carolina: Mayonnaise
• North Dakota: Watermelon-flavored gum
• Ohio: Grape-flavored drink mix
• Oklahoma: BBQ sauce
• Oregon: Humidifiers
• Pennsylvania: Plastic hangers
• Rhode Island: Christmas lights
• South Carolina: Coin banks
• South Dakota: Orange juice
• Tennessee: Disney Infinity Power Discs
• Texas: TV wall mounts
• Utah: Personal travel care kits
• Vermont: Sweet canned corn
• Virginia: Coolers
• Washington, D.C.: Great Value French Fried Onions
• Washington State: Vanilla frosting
• West Virginia: My Life As Dolls
• Wisconsin: Green Bay Packers bath mat
• Wyoming: Flannel shirts

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