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Unemployment is low, consumer confidence is high and companies are starting to reap the benefits of their investments, from individuals to technology, experts believe that retailers and brands should have a good holiday season.
"We expect everyone to have a very good year," said Rod Sides, head of retail practice at Deloitte. "They do not, they are a bit out of sync with consumer expectations."
Deloitte predicts that holiday retail sales will increase by 5% to 5.6% over last year, reaching more than $ 1.1 trillion. According to Deloitte's vacation survey in 2018, online sales would be more than $ 128 billion.
"We expect everyone to have a very good year. If this is not the case, they are a little disconnected from consumer expectations. "
Deloitte expects buyers to spend an average of $ 1,536, gifts, experiences and other benefits. Nearly half of respondents (47%) think that the US economy is going to improve, although 74% still think that getting a good deal is the main feature of purchases.
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But about as important is the ease of purchase.
"We are competing for the customer on the basis of convenience, more than anything else," said Sides.
Many buyers are wondering how companies make their purchases easier, especially if they are willing to pay a few extra dollars, he said.
In a report released Thursday by Moody's, analysts say that "the strong US economy" has prompted them to change their outlook to make it positive for the first time since July 2015. Moody's expects retail sales growth from 5% to 6% this holiday season.
"The main boost to our forecasts … is a very strong macroeconomic environment that drives operating revenues and revenue growth," the report says. "Retail is benefiting from improved consumer confidence, consumer confidence and low unemployment."
Retailers are also benefiting from the efforts and investments they have made in their digital businesses. The report specifically calls Walmart Inc.
WMT, -0.24%
, which, according to Moody's, "continues to increase its operating profit as its investments in online prices and growth begin to bear fruit."
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Target Corp. is another retailer that invests billions of dollars in digital, distribution and other areas of its business.
TGT -2.25%
. This week, Target announced that it would offer a two-day free shipping on purchases with no minimum.
The retailer said it was implementing all of its delivery options, from the same day delivery to the national transportation service, a focal point as it tries to make itself known as "America's easiest shopping spot" ".
"Some retailers in some retail sectors are going to be weaker than another sector because they are a bit late, heavily indebted or have smaller players," said Mickey Chadha, vice president of Moody's. . "These companies are unlikely to reap the same benefits as stronger, well-capitalized companies that can invest and grow in their businesses."
Chadha said that companies should look internally, not just during the holidays, but throughout the year to stand out challenges. But the solutions can go up to dollars and cents, and, for small businesses or those who are short of money, a win could be 'all that shows that the pace is going to be high. improved".
"It's a story of rich and poor people in retail," he said. "The poor are short of money, are smaller or have no financial flexibility and will obviously have bigger problems."
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Retailers should have already started the season off right. Austin Rochford, director of data science at Monetate, said the company's data showed an increase in order values as the season progressed. So, September is stronger than August, and so on. This year, compared to last year, this trend is even more pronounced.
"We are seeing an acceleration in the order value twice as fast from August to September, [which is] likewise from September to October, "said Rochford. Monetate examined data from 230 online retailers representing 350 million purchases, for analysis.
He also found that the number of orders also increased during the holiday season.
"Buyers buy more and make more purchases," Rochford said.
The Amplify Online Retail ETF
J & # 39; BUY, -3.25%
has gained 4% since the beginning of the year, while the SPDR S & P Retail ETF
XRT -1.32%
is up 2.4% for the period. The S & P 500 index
SPX, -1.73%
decreased by 0.6% in 2018 so far, after registering a decline of 3.9% during the week ending Friday.
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