Thursday, December 9, 2010 | Edited by Daniel Moores
||Consumers Are Buying For Themselves This Christmas
Consumers are adding a very important name back to their holiday shopping lists this year: their own.
The percentage of shoppers who say they plan to indulge in a little something extra for themselves has risen four points since last year to more than 57 percent -- the biggest jump in at least six years, according to an industry survey. Sales of jewelry, apparel and consumer electronics are up so far this holiday season from last year, and experts attribute part of the boost to what has become known as "self-gifting."
You didn't think Dad was going to give that 50-inch flat-panel TV to someone else, did you?
"The consumer really is sitting there saying, 'I'm going to take advantage of these deals,' " said Marshal Cohen, senior analyst for NPD Group, a consumer research firm. "This consumer is saying that there really is some pent-up demand."
During the nation's economic downturn, consumers saved money by whittling down their Christmas lists. Spending on gifts for babysitters, co-workers and teachers were slashed, and, in the ultimate act of self-sacrifice, shoppers cut back on themselves.
According to the National Retail Federation, the number of self-gifting shoppers began to fall in 2007 -- the year the recession began -- after steadily increasing for several holiday seasons. Though the number ticked up in 2008, it plunged last year to under 53 percent of shoppers. The amount they intended to spend last year also fell nearly 5 percent to $101.37.
This year, both measures have rebounded along with consumer confidence. And shoppers reported plans to spend an average of $107.50 this Christmas on themselves, the NRF said.
"The economy is picking up a little bit," said Lisa Bennett, as she sipped a Bellini on a recent evening at a cocktail party at Bliss Spa in downtown Washington, D.C. for its top customers.
Bennett said the sense that the recovery is on track made her feel a little less guilty about spending $200 online at Ann Taylor for herself while she was scouring the Internet for gifts for her teen cousins. They got Best Buy gift certificates and J. Crew sweaters; she got two new tops and a dress and then booked an oxygen facial for herself at the spa.
General manager Michelle Caron said customers are not only booking "maintenance" appointments -- the manicures and waxing counted as necessities among some women -- but also reserving more indulgent services such as facials and massages. This holiday, the spa launched a new service dubbed Shopper's Delight, a lower leg massage and exfoliating treatment for $70.
"We've only been getting busier and busier," Caron said.
Industry experts say the return of self-gifting is a telling indicator of consumer health. Over the past two years, as consumers have grappled with high unemployment, falling home prices and a volatile stock market, spending was primarily driven by necessity. Retailers that sold staples such as groceries held up better during the recession than those that stocked discretionary items.
But if shoppers are now willing to buy for themselves, that could mean the big freeze on consumer spending is starting to thaw.
Cohen said self-gifting helped drive the strong sales and shopper traffic over the post-Thanksgiving weekend. His research showed 35 percent of shoppers bought something for themselves, more than he expected.
Self-gifting could also prove lucrative for retailers because it rarely occurs by itself, Cohen said. Shoppers may reward themselves after spending on others or, on the flip side, justify their own purchases by buying a few gifts.
"It's like it becomes a fever," he said. "For every self-gifted item, there's generally another item that gets added to the assortment as well."
At Fair Oaks Mall in the Washington, D.C. area, general manager Robbie Stark said self-shopping dominated the Black Friday weekend, including one four-hour line of teen boys waiting to buy $10 T-shirts at Elite Board Shop, which sells skateboard gear. He said retailers welcome the business to pad holiday sales.
"The more self-buying that goes on, that's good because they're still going to get the gift-buying," he said.
Still, New England Consulting Group founder and chief executive Gary Stibel said any increase in self-gifting is incremental at best. Shoppers put their kids first and their pets second, he said. Parents and spouses take the back seats, leaving only a tiny portion of discretionary income left over for personal indulgences.
"She's trying to take care of everybody, but she more often than not puts herself last," Stibel said of the typical female shopper. "She's too damn conscientious for her own good."
So which actually makes us happier: self-sacrifice or self-indulgence? A study by Harvard Business School associate professor Michael Norton and two colleagues from the University of British Columbia in 2008 examined whether shoppers derived greater pleasure from spending on themselves or on others.
The researchers gave up to $20 away to shoppers with instructions to spend it on themselves or on other people -- perhaps through a gift for a friend or a donation to a homeless shelter. Though most people expected to enjoy keeping the money, Norton said that at the end of the day, those who bought for someone else reported feeling significantly happier.
Of course, devoting a day of shopping for someone else is one thing. But the holiday shopping season is two full months of making a list, checking it twice, then trying to balance your checkbook. Norton said his research did not examine whether the drawn-out process of gift-giving can overwhelm the joy of giving, but he is clearly no Grinch.
"In the moment of giving," he said, "it's still nice to have given a gift to someone."
(Source: The Washington Post, 12/06/10)
||Restaurants Offering Deals for Holiday Parties
Despite the economic Grinch threatening to steal corporate party business as it has over the past two holiday seasons, a number of operators say early incentive efforts have been helping them boost sales over last year.
However, even for those operators managing to book parties during the holidays, the season could be merrier.
One survey released in November predicted 2010 would see the worst holiday party slump in 22 years. The poll, conducted by Amrop Battalia Winston, a global executive search firm based in New York, found only 79 percent of businesses were planning a holiday celebration, down from 81 percent in both recessionary 2009 and 2008 -- the previous lows in the survey, which started in 1989.
"Compared to last year the amount of parties seems to be the same," said Ashley Lightfoot, private events manager at the Eddie V's Prime Seafood in Dallas. "They booked later than normal but seemed to be very selective while doing research. I had lots of inquiries early but the bulk of the groups did not confirm until October-November."
And costs remain top of mind, Lightfoot added. "I have noticed the major thing is the wine selection," she said. "For instance, I have a repeat group from last year that chose wine in the $50- to $60-a-bottle range and this year is going with our house (wine) at $28 per bottle."
That is a trend seen throughout the year, Lightfoot said. "I can pretty much say that for the whole year: same amount of parties but spending less."
This season, restaurant operators started offering incentives early to inoculate against the party-blues flu.
The 15-unit Texas de Brazil churruscaria chain had offered gift-card rebates to parties of 15 or more for bookings made before Nov. 30. The deal was to give 10 percent of the holiday party cost at regular dinner menu prices, up to $1,000, in gift cards.
Wolfgang Puck Catering offered early booking discounts for holiday events. And Dave & Buster's offered free room rentals or more than half off game play for those booking before November.
Smith & Wollensky Restaurant Group of Boston offered complimentary butler-passed hors d'oeuvres for events booked prior to Nov. 15. And the eight-unit chain's private-dining managers planned fixed-price dining packages, exclusive pricing on signature items and custom menus.
Nicole Lierheimer, spokeswoman for Smith & Wollensky, said, "The holiday promotions have been helpful in motivating event bookings.
"We are pleased to report that sales for the holiday dining season are up, thanks to the ongoing support of our loyal customers and the communities in which we do business," Lierheimer said.
Coming off the dismal party-spending years of 2008 and 2009, many companies were pleased that some business wallets actually were open this year.
At Ruth's Chris' Steakhouse, holiday party reservations rose 17 percent over last year's depressed numbers. "We are looking forward to our most successful holiday private-dining season since 2007," Mike P. O’Donnell, president and chief executive of parent Ruth's Hospitality, told securities analysts in late October.
Amrop Battalia Winston's 2010 "Annual Survey on Corporate Holiday Celebrations," which polled 103 leading companies, also found that for those companies holding celebrations, just over a quarter, or about 28 percent, said their parties will be more modest. This follows on the heels of the nearly half, or 49 percent, who downsized in 2009.
Amrop chief executive Dale Winston said, "Fundamentally, those having holiday parties this year are much more optimistic about the year-ahead, while those not having parties are more pessimistic."
Among other survey findings:
(Source: Nation's Restaurant News, 12/02/10)
- Celebrations this year will not be for client or business prospects. Only 5 percent of those holding parties intend to invite clients and friends. Over two-thirds -- 69 percent -- will be "employee only," while 26 percent of organizations intend to invite employees and their families to gatherings.
- Companies said they were planning not to skimp on cocktails. The number of companies expecting to serve alcohol increased this year, to 79 percent, which is up from 73 percent in 2009 and 71 percent in 2008. The survey high was in 2000, when 90 percent served cocktails.
- After-work parties are increasing in popularity. Of those conducting holiday celebrations, 57 percent are expected to be evening affairs compared with 53 percent in 2009. About 43 percent were planning holiday lunch parties compared with 47 percent in 2009.
- Many companies are expecting to get away from the office. More than three-quarters, or 77 percent, of firms said they were planning to host their parties off-site, up from 67 percent last year. And 76 percent of those companies said they would be holding a party "off-site" at a restaurant.
||If Your Target Audience is Teen Christmas Shoppers...
A recent AMP Insights Holiday Shopping Behavior survey looked at teens between the ages of 13 and 19, and came up with some interesting results regarding what they are buying, where they are buying, and what they would like to receive for Christmas.
Teens have deep pockets:
-- 49% are planning on spending over $150 on gifts for others this holiday season.
-- 20% are planning on spending over $300 on gifts for others this holiday season.
They're planning to give gifts to those closest to them:
-- 86% plan to give gifts to parents.
-- 75% plan to give gifts to siblings.
-- 74% plan to give gifts to friends.
-- 60% pan to give gifts to boyfriends and girlfriends.
Teens treat themselves when shopping for holiday gifts for others. Sixty-five percent say when shopping for gifts for others, they will sometimes shop for themselves if they happen to find something they need or want.
Finding the best deal is the number one priority for teens. Forty-five percent research a gift item to find the best deal before purchasing.
Though Apparel is ranked high on teens' wish lists, the Electronics and Entertainment categories are top choices:
-- 79% hope to receive gifts in the Electronics category.
-- 69% hope to receive gifts in the Entertainment category.
-- 61% hope to receive gifts in the Accessories category.
-- 47% hope to receive gifts in the Apparel category.
-- 46% hope to receive gifts in the Footwear category.
-- 32% hope to receive gifts in the Health and Beauty category.
Within the Electronics and Entertainment categories, teens want items for a fun experience:
-- 85% hope to receive video games.
-- 74% hope to receive movies.
-- 74% hope to receive music.
-- 64% hope to receive an iPod.
-- 59% hope to receive a laptop.
Big retail stores rise to the top for shopping:
-- GameStop, 62%
-- Wal-Mart, 60%
-- Best Buy, 57%
-- Target, 53%
-- Hot Topic, 46%
-- JC Penney, 45%
-- Macy's, 40%
-- Aeropostale, 37%
-- Apple, 37%
-- Hollister, 36%
(Source: The Center for Media Research, 11/30/10)
Daily Sales Tip: A Checklist of Best Practices
Selling is probably the most important contributor to business health, even more important than products and services. It's a difficult art to master. So it pays to develop good mechanisms to support and guide the sales effort. Here are five "Best Practices" that can help sales managers and their staffs:
Create an Ideal Customer Profile
Develop this profile on customers with whom you have had success in the past. Detail not only the facts (demographics, company size, annual revenues, SIC codes), but the qualitative characteristics as well, those elements that represent the value they seek when doing business with your company.
Set Clear Expectations
Give your salespeople clear and quantifiable performance expectations for all stages of the sales process. Don't simply throw a quota and a territory map at them. Tell them you expect them to convert so many leads to suspects, suspects to prospects, prospects to contracts, contracts to repeat business. And follow up with them.
Track Performance and Share the Data
Stop managing your sales force by anecdote, those traditional sales meetings where each salesperson fills up time telling about why this or that deal hasn't closed yet. Instead, focus on collective performance against those expectations you laid out above. Build sales meetings around a review of the data. Now you're dealing with facts.
Work on the Process to Improve Results
If sales are down this month, don't panic. Instead, examine the underlying processes to see where the slowdown occurred and why. Maybe sales are down because there's an operational glitch, or an unexpected trend in the local market.
Give Great Support
Everybody likes nice bosses better than mean bosses, but great sales support means more than that. It means removing obstacles to performance wherever possible, smoothing the way, and leaving people alone when that's appropriate.
Source: Ellen Bristol, president of Bristol Strategy Group