1 in 4 plan personal electronics buys at holidays
Though the recession is technically over, many Americans are still feeling the pinch of a slow-to-recover economy. No surprise, then, that shoppers are planning to cut back on spending, something that electronics retailers and manufacturers are looking to combat with an early onslaught of advertisements.
The most recent Consumer Reports Index, however, which tracks planned purchases for November, shows a bright spot: personal electronics. According to the November Consumer Reports Index, one quarter of Americans are planning to buy smaller gadgets like digital cameras, cell phones, music players, and similar devices. That percentage is up 5 points from October, when only twenty percent of consumers planned such purchases.
By comparison, roughly ten percent of Americans plan to buy major home electronics items like TVs or home-theater systems. That category ticked up only a fraction of a percentage point from October, which might signal a slow season for such big-ticket purchases.
Are you one of the 25 percent planning to buy a personal electronic device, the ten percent who want a TV, or are you forgoing digital gifts–for yourself or others–altogether this season? Given the early push on Black Friday sales, many major retailers would be sorely disappointed to hear the latter.
The Consumer Reports Next-30-Day Retail Index shows that planned retail purchasing for November was up slightly to 9.0 from 8.3 for the prior month. Planned purchasing of personal electronics in November has surpassed the near-term high in July '09 (22.1). Major home electronics ticked up slightly to 10.7 percent from 10 percent in October — its highest level since June.
However, overall the bulk of consumers are reluctant to increase their retail spending habits as we approach the unofficial start of the holiday shopping season. Retail purchases in the past 30 days, as well as the overall outlook for the next 30 days remain soft, with little interest in increasing spending in other areas like appliances, yard and garden tools, cars or new homes.
"While relative stability has returned to the Retail Index, it has not been able to demonstrate growth for three straight periods. With the holiday season fast approaching, this has dire implications for expectations this season," said Ed Farrell, a director of the Consumer Reports National Research Center.
Overall the Past 30-Day Retail Index fell slightly to 9.0 from 10.4 in October and was significantly behind September (11.0). The Next 30-Day Retail Index stands at 9.0 relatively unchanged over the past 3-months.
The Consumer Reports Sentiment Index appears to be stabilizing, an improvement that coincides with a decline in personal financial difficulties and the Consumer Reports Trouble Tracker has fallen slightly to 62.1 from 65.5 in October and is down significantly from September's high of 68.7. The Consumer Reports Stress Index stands at 60.5, down slightly from October (62.3) but well below September (65.4). Additionally, the Employment Index is at 49.0 virtually unchanged from October's 48.4 reflective of a market that is still shedding jobs.
"The economy remains in a precarious position where further decline is possible but is slightly less likely. Unless consumers can see concrete improvements in their lives and retail activity picks up, any near-term recovery is improbable," Farrell added.
[Source: Consumer Reports]