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After early Grinch warnings, holiday shopping forecasts gaining confidence

 
Sandy Kelly of Port Richey, second from left, fights the crowds at Gulf View Square mall in Port Richey with her daughter Laura, center, a few years back, before e-commerce had made the impact on holiday shopping that it has now and people preferred shopping at brick-and-mortar retailers.
Sandy Kelly of Port Richey, second from left, fights the crowds at Gulf View Square mall in Port Richey with her daughter Laura, center, a few years back, before e-commerce had made the impact on holiday shopping that it has now and people preferred shopping at brick-and-mortar retailers.
Published Nov. 20, 2015

Early fall predictions of the holiday shopping season were less than stellar, with respected firms like Morgan Stanley warning that the Grinch "could steal Christmas" this year.

Additional negative vibes grew as we watched the stock prices of the top traditional department stores, from Macy's and Dillard's to Nordstrom, fall off a cliff. Macy's shares that traded over $70 as recently as July now trade under $40. Dillard's traded over $140 in April but then toppled to about $75. Even Nordstrom, long viewed as a brand more insulated from economic swings, finds its stock trading in the mid $50s after topping $80 in March.

And who can argue with Wall Street? Too many department stores continue to suffer from yesteryear branding and a perception that they are overpriced in an era of heavy discounting.

That's why Macy's recently rolled out its first Macy's Backstage discount stores. This month, Macy's announced it will open 50 more locations of its new chain over the next two years to compete with the growing success of deep-discounting chains like Marshall's and TJ Maxx.

Is selling for less the cure for this year's retailer blues? Doubtful. Folks are likely to spend as much or maybe even more than they did last year on holiday gifts.

But what they buy and, more important, where they buy it is shifting quickly.

Online purchasing, of course, is still rising rapidly, as is the marketing success of informing consumers via direct emails of shopping deals. FedEx predicts it will move a record 317 million shipments between Black Friday and Christmas Eve, an impressive 12.4 percent bump in volume over last year.

"The shift in consumer shopping patterns, fueled by the rise of e-commerce, continues to drive our volume," FedEx CEO Frederick Smith recently stated.

The National Retail Federation expects November and December sales to grow 3.7 percent to $630.5 billion. And this week, the Florida Retail Federation was even more bullish, predicting a 4.5 percent increase in holiday sales. Rick McAllister, the longtime Florida Retail Federation CEO who will retire at the end of this year, cites the state tourism boom and rising consumer confidence in the state economy as key drivers behind the upbeat forecast.

"When people have more money in their pockets, they feel better about spending that money," McAllister said.

Part of the shopping game this season, of course, is figuring out what are truly the best deals among all the hype.

A new WalletHub study of Black Friday may offer some insights. The study finds J.C. Penney is the top discounter, averaging a 68 percent markdown on Black Friday. Kohl's follows closely at No. 2, with 67 percent discounts.

It's notable that two big players, Walmart and Amazon, ranked much lower on the Wallet­Hub ranking of Black Friday discounts. Walmart discounts average 30 percent. Amazon comes in at 25.8 percent.

The folks at Forrester Research, which put out its own holiday shopping forecast this month, along with those at Consumer Reports, clearly never met the Grinch. Forrester survey findings say U.S. shoppers are expected to spend $95 billion this season, up a whopping 11 percent.

And Consumer Reports' prediction on spending released Thursday is even bolder. Holiday shoppers expect to spend a median of $529 — an increase of 21 percent over last holiday season.

Contact Robert Trigaux at rtrigaux@tampabay.com. Follow @venturetampabay.