Thanks to a December surge in my own business, I got a late start on holiday shopping this year. But when I finally got going, I was amazed at the crowds. I was expecting to find deals galore and empty stores. Not so on both fronts!
The weekend before Christmas, The San Francisco Centre was mobbed. Forever 21 was as crowded as usual, if not moreso. Gap, Macy’s, Bloomingdale’s, Restoration Hardware, even Kenneth Cole were similarly jammed with shoppers…and buyers. There were sales, to be sure. At Kenneth Cole, everything in the store was at least 36% off, which enticed us to buy when we otherwise would have only looked longingly. Resto had a huge table of stocking stuffers marked down 30%. (Though when I got home to wrap them, I found price tags covering up lower prices – so they pulled a classic mark-it-up only to mark-it-down move!)
My own experience doesn’t jive with Stephanie Rosenbloom’s Dec. 25 story in the NYTimes reporting a 24% drop in holiday store traffic. Everywhere we went, there were crowds with shopping bags to prove they had purchased. Even the grocery stores were packed. The aisles at our local Safeway were jammed with shopping carts loaded to the gills on the 23rd. In Whole Foods on the 24th, the tension was palpable. We realized we had not made enough desserts for Christmas Eve dinner, and went in to pick up a few more treats. It was no treat inside.
At Christmas Eve dinner, I discovered to my surprise that credit card issuers may not understand that people retreat to cash in a recession. An in-law who works for a major card issuer reported that her firm was interpreting the fact that it was missing its transaction volume forecast as proof that the economy was still in decline. Though no doubt, the decline continues, I offered up a few explanations for why her company's transaction volume could be down. First, people are using more coupons and doing more comparison shopping, so they are getting better deals (which translates into lower average order size). More importantly, more people are shifting to paying in cash. These explain why they could be missing plan but sales could be more robust than they appear. The shift to cash has been well documented – I even blogged about it in October!
Could the same thing be happening with store traffic counts? Are the people and tools for capturing store traffic somehow missing vital pieces of the market? As with the Florida vote in 2004, where the down ballot candidates all got more votes than the presidential ticket, is there a massive undercount going on – albeit unintentional?