From: Phil deHaan (dehp@calvin.edu)
Date: Wed Nov 05 2003 - 11:17:08 EST
November 5, 2003 == MEDIA ADVISORY
One of the busiest shopping day of the year, the day after Thanksgiving, is
just around the corner and Michigan retailers are hopeful about 2003 sales.
Calvin College marketing professor Steve VanderVeen says expectations might
even be too low.
"The expectation," he says, "is that holiday sale will be up five to six
percent this year over last year. But since the last two years have been
pretty lousy, retailers may be underestimating 'pent-up' demand. Although
people may not have any more money to spend this year, they may be more willing
to spend money."
He adds: "There are not only economic variables, but also psychological
variables to consider when trying to forecast holiday sales. And while the
economic variables are relatively easy to quantify, psychological variables are
more important, yet also tougher to read."
Economic variables, says VanderVeen, consist of things such as GDP, job, and
personal income growth. The effect of income and job growth on holiday sales
could be moderated by such things as the number of shopping days between
Thanksgiving and Christmas and the weather, particularly the weather during the
two weekends before Christmas.
That's because, VanderVeen says, while sales figures spike on the day after
Thanksgiving, they then drop sharply before steadily increasing throughout
December. The result is that Black Friday (the day after Thanksgiving - so
named because it's the day retailers watch their "bottom line" move out of the
red and into the black) generally ends up ranking as the fifth biggest sales
day of the year at most (and sometimes less), behind the four days comprising
the two weekends before Christmas. The day on which holiday sales peak varies
depending upon which day of the week Christmas falls upon, but the highest
sales day is usually either the last Saturday before Christmas or December 23.
VanderVeen says seemingly silly things like a nice light snowfall on the
weekends before Christmas can boost sales. Other psychological variables
influence how much money people think they are going to have and how happy they
feel when its time to go holiday shopping, which influences how much money they
will spend.
"Ironically," says VanderVeen, "this may be the year when job and income
growth is much weaker relative to retail holiday sales. Because the GDP is
growing, people expect job growth and income growth to follow."
Another variable that has significant psychological impact is the
geo-political situation.
"Since we have not had a significant domestic terrorist attack since 9/11,"
says VanderVeen, "people and businesses seem more willing to resume spending,
maybe even more than they can afford to."
Contact VanderVeen at 616-526-6338
-end-
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