2007 Holiday Retail Report A Mixed Bag
According to this excellent report by ComScore, the Internet economy (or eCommerce if you will) has been quite robust lately. Internet spending was up 19% for the 2007 holiday season over the previous year. That is incredibly strong! For the record 2006 was up 26% over 2005, but that does not dampen the robust nature of the 2007 holiday e-commerce retail spending data.
But what about traditional commerce? How's the old economy doing? Despite a strong, promising start (Thanksgiving weekend traffic was reportedly very strong - measured at 6.5% increase vs. 2006), bricks-and-mortar retail was weaker this holiday season. According to the New York Times, consumer spending for the 2007 retail season was up only 3.6% from 2006. The comparable year-over-year rates of increase were 6.6% and 8.7% for 2006 and 2005 respectively. [The analysis in the article also adjusts for higher gasoline prices to conclude that the net increase in retail spending for 2007 was more like 2%. Still it was an increase. That's not entirely bad.]
Finally, there's more of the overall holiday retail assessment to be gleaned from the following report from Thomson Financial (via ddi magazine online):
According to a preliminary same-store sales tally by Thomson Financial, 16 retailers missed projections, while seven surpassed forecasts and one met expectations. While weak results were posted across all retail categories,apparel retailers, such as Limited Brands Inc. and Pacific Sunwear of California Inc., were the hardest hit. Limited reported an 8 percent decline in same-store sales--financial analysts had predicted a decline of only 4 percent. However, Wal-Mart Stores Inc. and Costco Wholesale Corp. reported same-store sales increases for December. Wal-Mart's same-store sales rose 2.4 percent, surpassing a forecast of 1.8 percent, while Costco posted a 7 percent increase in same-store sales, above the 5.6 percent prediction.
All in all, the 2007 holiday retail season was a mixed bag: somewhat weak overall, with a few bright spots. The notable exception was online retail, or e-commerce.
Any marketing genius who dares to say that the Internet is becoming increasingly important to business success is absolutely correct!