 |
 |
 |
 |
 |
 |
 |
Shopping Centers Today -> September 2002
 PRINT THIS STORY: |
  CHANGE TEXT SIZE: |
|
JUST 26 DAYS TO SHOP
Fear not, length of 2002 holiday season matters less than economy
By Michael Baker
 |
For the past five consecutive years, each holiday shopping season — at least if you define it as the number of days between the day after Thanksgiving (Black Friday) and Christmas — has been longer than the preceding one. This year, however, the season is dramatically shorter, falling to a mere 26 days, compared with 32 in 2001.
So is this 26-day whippersnapper of a holiday season yet another burden retailers have to bear this year, on top of the economic uncertainty that may yet persist through the critical fourth quarter? The answer is probably, and surprisingly, no.
To begin with, let’s be clear: Consumers have a set list of people to buy gifts for, and they will run all the way down that list whether the season is 26 days or 32. Uncle Bob is not going to miss out this year just because you normally buy his gift on the 27th day. Still, in a direct 26-versus-32-day comparison such as the one we’ll have this year, total retail sales are bound to be flat or slightly down, not because there will be fewer gift purchases but because there will be six fewer days than last year of everyday purchases, such as groceries and the other consumables households normally buy on a relatively set schedule.
 |
OK, how do we make the year-over-year comparison fair and get a realistic assessment of the holiday season? Well, there’s no law that says you have to measure the success of the holiday season just by looking at sales between Thanksgiving and Christmas, though the two do bookend the most intense holiday gift-buying period. Retailers also make a significant number of holiday-related sales before Thanksgiving, particularly when the holiday comes late and consumers feel the need to get a move on with their gift-buying before the crowds hit the malls. Moreover, retailers make some highly productive sales in the days immediately following Christmas itself.
One perfectly valid approach, then, is to look at combined sales for the months of November and December. The line in the accompanying chart shows the year-over-year percentage change in November and December sales for the past 10 years. The number of days between Thanksgiving and Christmas is also shown as columns on the same graph.
There is no evidence from the chart that having fewer days between Thanksgiving and Christmas results in poorer year-over-year sales results for November and December. In fact, in five of the past 10 years a longer Thanksgiving-Christmas period was associated with a weaker sales increase. The last time we had a 26-day season — 1996 — sales rose by a respectable 4.6 percent for the combined November-December period (exactly double the 2.3 percent increase for 2001, when there were 32 days between Thanksgiving and Christmas).
Clearly, then, it’s not the length of the season that matters so much as the economy and the mood of the consumer. This is not to say, however, that a shorter season doesn’t have an impact in other ways. It results in more crowding in the nation’s shopping centers, for one thing, as many people try to get the same amount of shopping done in a shorter time frame. And second, you’re likely to see very strong year-over-year sales comparisons from Thanksgiving onward. That’s simply because in a shorter season, Thanksgiving occurs later and closer to Christmas; shopping days closer to Christmas are more valuable in terms of sales-generation than shopping days further away. But these outsize sales gains are not necessarily going to be indicative of a strong holiday season. Unfortunately, that can’t be assessed until the end of the year, when it becomes possible to compare equal time periods.
 |
But retailers can at least count on one thing: Realizing that time is short, consumers are likely to hit the stores with a vengeance on Black Friday and the ensuing week, resulting in a greater volume of high-margin sales. The broad-based and deep discounting we saw during the long, drawn-out 2001 holiday season is unlikely to be repeated with anything like the same intensity this year. Also keep in mind that throughout 2002, retailers have been holding inventories well below last year’s levels and will undoubtedly keep them slim and trim going into the holiday season as well, providing a further lift to margins and profitability while reducing the importance of post-Christmas clearance sales.
So retailers, fear not the short season. Rather, keep your eyes on the economy because that, of course, is the direction from which the real damage comes.
Michael Baker is director of research for ICSC.
 | Current Issue February 2012 |