Retail experts: Best holiday deals closer to Christmas, not necessarily Black Friday

The Day, Sean D. Elliot / AP

Shoppers wait in line at Best Buy in Waterford, Conn., on Thanksgiving Day, Thursday, Nov. 28, 2013.

Setting up a tent and camping for days outside your favorite big-box retailer for those screaming Black Friday deals sounds like either an adventure or a nightmare.

For those tent-dwellers, experts have some bad news to share: the best holiday shopping values might pop up closer to Christmas this year.

“I think the discounts get larger as you get closer,” said Melina Cordero, head of retail research for the Americas at CBRE, during a conference call on holiday retail trends last week.

A Retail Holiday Trends Guide from commercial real estate firm CBRE indicates total retail sales growth for the 2016 holiday season to range between 1.7 and 3.6 percent, totaling an estimated $885 billion. The holiday season is defined as the total of November and December sales.

The e-commerce category will surge well ahead of that pace, however, with anticipated holiday online sales growing more than 17 percent and comprising nearly 11 percent of total holiday retail sales. Of those online sales, just under 30 percent will be from mobile devices — a year-over-year jump of more than 43 percent in what is being called ‘m-commerce.’

Darin Mellott, CBRE’s director of research and analysis for the Southwest region, sees the Las Vegas market mirroring the national trends.

“Because of the dependence on tourism and gaming, the Las Vegas economy will closely track the national economy,” Mellott said. “I wouldn’t expect a significant departure from those numbers.”

As a Las Vegas native, Matt Bear, vice president for global gaming and group retail at CBRE, admittedly could not provide a bullish forecast on retail strength in the valley throughout the past decade. In addition to seeing the local economy stabilizing, Bear looks to this particular holiday season with hope because of the end of a nasty political season.

“I do think people are overall feeling better that the election is over, no matter how you voted,” Bear said. ‘’We’re multiple points better in climate in this city. I expect it to be good. We’re light years better than we were five years ago.”

Big-box retailers like Best Buy and Target also might not offer their top shopping offers inside brick-and-mortar stores either. Cordero said much of the growth in e-commerce stems from traditional large retail operations expanding their online offerings.

Adjusting to customers’ growing preference for online shopping comes with headaches for retailers. Customers increasingly demand free and fast shipping, resulting in 54 percent of retailers offering guaranteed delivery of online purchases through Dec. 21, or in some cases ever later. Some large retailers will test delivery partnerships with ride-sharing services like Lyft and Uber to increase their agility in fulfilling last-second delivery needs.

Returned merchandise also presents challenges. In 2014, customers returned less than 9 percent of holiday purchases to brick-and-mortar stores, but sent back more than 30 percent of their online buys. Many of these returned items never make it back to market, with 2 million tons of returns ending up in landfills in 2014.

Retailers cite the cost of processing returns as the reason for junking so much merchandise. The company often pays for return shipping, quality control to determine if the item can be resold, and then shipping to another facility for repackaging. By the time this process completes, the prime holiday buying season has ended.

“It ends up so heavily discounted that you have no profit margin left and, in fact, you might have lost money,” Cordero said. “That’s a nightmare for retailers, that’s expensive.”

Business

Share