While gadgets and electronics continue to be hot items year-on-year, there will be fewer large purchases this holiday, such as TVs and computers. This is partly due to the fact that retailers will look to reduce the number of deep discounts – which severely damaged margins this time last year – along with the fact that customers will move towards needs over wants.
“This season there won’t be a “wow” factor in terms of sales,” said Toon van Beeck, senior analyst with IBISWorld. “Consumers have been so inundated with discounts for more than a year that it will be difficult for retailers to get shoppers excited about holiday promotions.”
However, one of the biggest gadget winners this holiday will be e-book readers, partly because the prices are being driven lower by competitors entering the market (e.g. iRex and Nook). About 30 percent of all e-reader sales in 2009 are estimated to derive from the holiday period alone.
“Consumers will reduce spending on big ticket items,” said van Beeck. “Instead, they’ll trade down towards trendy and cheaper gadgets like e-readers; iPod Nanos; Nintendo Wiis and other game consoles; Flip Video and small point-and-shoot digital cameras. This is where the real value will be for consumers this Christmas.”
Marvelous Man 