Resilient consumers heading to stores to spend for the holidays are contradicting earlier warnings of a slow season. Despite recent data reporting that the economy is officially in a recession, stores have not seen a major slump in retail sales.
The good news came during the much heralded busiest shopping weekend of the year–the days following Thanksgiving. According to a poll by TeleCheck Retail Index of more than 27,000 retailers, sales rose 2.4 percent over last year. TeleCheck predicts and overall sales increase of 2 percent for the holiday. Sales were up across the country, with the Southeast growing the fastest–at 2.7 percent.
Consumer Sentiment on the Rise
The positive early holiday indications followed a strong overall consumer sentiment throughout the month of November, according to the University of Michigan’s consumer sentiment index. That index–on a downward trend since late last year–reversed in October and rose for two straight months. The index was up to 83.9 percent in November, from 83.5 in October. Sales of durable goods, meanwhile, rose more in October than in any other month in nine years. The 12.8% increase in durable goods orders—computers and automobiles, for example, was the largest since 1992.
According to analysts, the news bodes well for a much hoped for recovery in 2002. The one negative report came from the International Council of Shopping Centers, which reported a 2.3 percent decrease in sales in mall-based jewelry stores. Their survey was based on reports from jewelers in major regional malls across the country. Analysts at the ICSC, however, downplayed the negative numbers.
“Thanksgiving weekend accounts for only about ten percent of total holiday sales, so there is a long way to go. With four complete weeks of shopping left, the season will most likely follow normal sales patterns, with the majority of holiday spending coming at the end of the season,” said Michael Baker, director of research for ICSC.
Romance, Patriotism, Drives Jewelry Sales
Jewelers across the country, meanwhile, have reported a surge in diamond engagement rings [See page 4]. At Harry Winston, sales of diamonds were strong during the first holiday shopping weekend of the year, for example, thanks to the meaningful messages traditionally attached to diamonds.
The sentimental aspect of diamonds and jewelry is being boosted by the marketing campaigns of industry giants like DeBeers and Tiffany.
Another strong category going into the holiday season is patriotic jewelry, in which diamonds play an important part. Along with pave stones–which is popular in various flag, American eagle, and other symbolic motifs–larger stones are being used alongside rubies and emeralds in red, white and blue-themed jewelry.