CHICAGO — According to a recent BDO USA survey, chief marketing officers at leading U.S. retailers expect a 3.7% increase in holiday comparable store sales, marking the survey’s most optimistic forecast since 2007, when CMOs projected a 5% increase in comparable store sales.
The majority of chief marketing officers (62%) expect consumer electronics will be the strongest selling category in 2012. The continued confidence in consumer electronics sales is likely fueled by similar expectations from 62% of CMOs that the category will see the most discounts and promotions during the holiday season. Price-matching programs at Target and Best Buy suggest that retailers will be battling with both online and brick-and-mortar retailers for these purchases.
“While we haven’t returned to pre-recession levels of optimism, retailers are gearing up for what looks to be a promising holiday season,” stated Doug Hart, partner in the Retail and Consumer Product Practice at BDO USA. “Still, consumers have more choices than ever, and retailers are looking to avoid showrooming by curating a mix of exclusive and top-selling products to get consumers in their door or on their site.”
Total holiday sales are projected to increase by 4.7%, reflecting slightly more optimism than the 4.1% projection released by the National Retail Federation in October.
Despite the optimism for consumer spending, most CMOs (61%) expect holiday season inventory purchases will stay at about the same levels as last year. CMOs forecast a 1% increase in inventory levels, which is consistent with the projections cited in BDO’s September survey of CFOs. On average, CMOs expect SKUs to increase 1.2% during the holidays, meaning shoppers may see slightly more variety on the shelves this year.
Unemployment has been identified as the greatest threat to those holiday sales lifts, BDO reported, with more than half of CMOs identifying that as a significant concern.
These findings are from the most recent edition of the BDO Retail Compass Survey of CMOs, which examined the opinions of 100 chief marketing officers at leading retailers located throughout the country. The telephone survey was conducted in September and October of 2012.