Holiday Shopping Will Be About the Same as Last Year

The holiday season has rolled around again, which means holiday shopping is already well under way for many shoppers. From advertisements on TV to ads all over the Internet, you certainly can’t miss the excess of promotions for holiday steals and deals. But due to the current recession, there’s been a bit of chatter about whether retail costs will be up or down this year from last year. As a result, many shoppers want to know just what to expect when they hit the stores, even though many are cutting back on spending to save money and beef up their savings accounts.

Retail Cost Expectations: Pretty Much the Same as Last Year, Maybe Lower

So what will you find in retail costs when you go shopping this holiday season? It looks like prices will be sitting pretty at around the same prices as last year’s holiday season. This isn’t necessarily a bad thing – it just means that you may not be “wowed” by the incredible savings you lay your eyes on this year. For example, DealNews.com has predicted some good deals on netbooks and laptops for Black Friday. The prices are expected to range from $199 (for 10″ netbooks) to $249 (for 15″ – 16″ laptops). These prices are very affordable, but they’re just not a lot less than what was found last year, or what you can find normally (i.e. you can find good netbooks for $199 at Sprint, as well as top-brand laptops regularly on sale for $299 – $329 at Best Buy). What’s interesting is that retail electronics aren’t the only items you’ll see “same-as-last-year” prices on. For instance, according to the American Farm Bureau Association (AFB), the cost of a modest Thanksgiving dinner for 10 people (which includes turkey, vegetables and a dessert) is expected to average about $42.61 in 2009. The retail foods required to make a Thanksgiving dinner will average about 4 percent less than last year’s $44.61 cost. So what is causing the similarities in prices?

• Lower retail volume: According to the National Retail Federation, which tracks imports, volumes are projected to decline 18 percent over last year. This will put them at their lowest since 2002. Dan de Grandpre, CEO of DealNews.com, recently noted in a WalletPop.com interview that this decline will affect apparel deals this year, meaning that we won’t see the major Macy’s store stock-ups of two years ago. Prices will be closer to last year’s.
• Reduced overhead: According to the AFB, lower energy prices and other overhead costs often lower retail prices. Since overhead prices this year aren’t too far off from last year’s, holiday pricing could remain similar as well.
• Still-slow economy: While there are indications that the economy is slowly improving, many retailers are still showing sluggish sales. That’s according to a recent report from Shopertrak RCT Corp. that shows the National Retail Sales Estimate for this October slipped 0.4% from last October’s – not too great for retailers.

However, according to recent research from Ball State University, we may see some last-minute reductions in price due to good old-fashioned competition. Since Wal-Mart reigns supreme with holiday deals, other stores will be trying to keep up. Michael Hicks, director of Ball State’s Center for Business and Economic Research, noted recently that Black Friday, if no other day, will have big deals.

Predicted Deals for Black Friday and Beyond

So you’re probably wondering what deals there are to look forward to this holiday season. Here are a few price predictions from DealNews.com:

• Home theater: Blu-ray players are expected to cost around $49, while you might find a complimentary 50″ 1080p plasma HDTV for as low as $899.
• Macs and monitors: iMacs and Macbook will likely see deals of 5-10 percent off and you may find name-brand 24″ LCD monitors for as low as $145.
• GPS and gaming: GPS systems like Garmin (a top brand) are predicted to start at $69, while the Nintendo Wii gaming console will likely cost $199.
• Other deals: Look out for free shipping, Paypal discounts and reduced prices at high-end retailers like Gucci.

Shopping Online Could Help Save on Retail

According to a recent Forrester Research, Inc. prediction, shopping for retail will continue to be a great place for affordable prices. The research company expects an eight percent growth in U.S. online sales this year, mostly due to mass-market retailers who can offer bigger discounts. It is for this reason that despite the global financial crisis, the online retail industry continues to grow. In total, it is estimated that online retail sales in November and December will reach $44.7 billion this year.

So now that you’ve received a holiday shopping prediction from us, are you going to change your holiday spending? Join in on the discussion and take our quick poll below.