a not-so-blue Christmas

In the glad tidings for retailers department: A forecast from the National Retail Federation (NRF) points to a booming holiday shopping season. That should bring good cheer to shopkeepers: The holiday season, which generally accounts for nearly one-quarter of the retail industry's sales in any given year, can make or break a retailer's annual performance.

The NRF's report, the 2004 Holiday Consumer Intentions and Actions Survey, showed that the average consumer planned to spend $702.03 on the holidays, which is up 4.5 percent over last year. Total holiday spending this year is expected to reach $219.9 billion.

This year, the average consumer will devote most of his or her gift budget to presents for family ($406.52) and friends ($71.29). He or she will also spend $22.12 on co-workers and $41.10 on other people, including babysitters, teachers and clergy.

But not all of the projected spending will go toward gifts. More than half of consumers (51 percent) plan to take advantage of sales this holiday season to make non-gift purchases for themselves or their families, spending an additional $89.25 on those purchases. Overwhelmingly,men and young adults plan to spend the most on themselves ($116.87 and $114.69, respectively). The average consumer also expects to buy decorations ($35.91), greeting cards and postage ($25.22), candy and food ($83.77), and flowers ($16.10).

Of course, it's hard to draw up a gift list without letting your thoughts stray to what you yourself would like to receive.When the survey respondents were asked what they hoped to find in their own stockings or gift boxes, books, CDs, DVDs, videos and videogames got the most mentions (53 percent). Clothing and clothing accessories came next at 50.6 percent, followed by consumer electronics (32.6 percent), jewelry (22.6 percent) and home decor items (21.3 percent). Still, it appears that about half of those surveyed don't quite trust their loved ones to select the perfect gift: This year's survey saw a spike in the number of respondents mentioning gift cards.More than half of the respondents (50.2 percent) said they hoped to receive gift cards, which is up more than 10 percent in two years.

How do consumers decide where they'll do their holiday shopping? Retailers may think it's customer service that counts, but the majority of consumers begged to differ. They told researchers that sales or price discounts (41.8 percent) or everyday low prices (15.6 percent) were the most important factors in deciding which stores to patronize. Other factors included selection of merchandise (20.0 percent), quality (8.7 percent) and location (7.8 percent). But that's not to say that retailers were entirely off the mark. Though only 4.4 percent of consumers cited—helpful, knowledgeable customer service—as the most important factor in determining where they'd shop, that was up from 3.1 percent just two years ago. Clerks take note.