Consumer Spending Online Looks Gloomy for The Holidays
Written by Pablo Palatnik on November 7, 2008
If you’re betting on Q4 to be the best quater for your online sales, it may be time to start looking at reality and preparing for a slow holiday season. This is the time, or maybe a few weeks back, to really start preparing what promotions you will run, what is the lowest price you can put on your items while still turning a profit, and so fourth.
The New York Times had an article today titled, “Retailers Report a Sales Collapse,” which tells the story about the state of the economy today which of course most of it is controlled by consumer spending. When that stops, the economy stops.
To tell the story, NYT reports, “Sales at Neiman Marcus, the luxury department store, dropped nearly 28 percent in October compared with the same month last year. Sales fell 20 percent at Abercrombie & Fitch, nearly 17 percent at Saks, 16 percent at Gap and nearly that much at Nordstrom.”
What is most interesting to me was I started to read peoples comments which of course are the people who we need to buy from us, right? Here are some quotes from comments left on the NYT article of what people are saying.
-I pretty much don’t buy anything right now. Only necessary purchases and the occasional dinner treat.
-My wife and I do not shop anything that is not really necessary. We do it naturaly, because that is the way it used to be - the way we were thaught. For a long time we have been saving. That is the best, and only, way to confront the hard time that is comming upon “the consumers of everything.” We hope that this recession will not last too long.
-I don’t care if the prices are cut by 60%; I am using the cash that I have to pay off my credit cards, hopefully to zero out by the end of the year. I am not going to shop. This is not a “shopping” economy.
-My wife and I are debating just how tightly to curtail our non-essential spending. The debate has taken a piquant turn, as I learned today that I’m being laid off, effective a month from now. Much of our discretionary spending is for culture (theater, concerts, books, CDs), and we’re lucky that we obtained most of our season subscriptions before the current crunch.
-We have totally shut down our shopping except groceries and some restaurant meals
-Time for a new economy that’s not based on buying a bunch of junk that we don’t need.
-The financial crisis has made me decrease my spending quite a bit which is extremely hard as a college student. I have been eating less and spend more time shopping for a better deal. I also look for places I can shop that give me some return for being a loyal customer since its mutually beneficial.
The comments continue as you can imagine…..
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