Burt Flickinger, Managing Director of Strategic Resource Group, goes live with Financial Journalist Josh Lipton on Yahoo Finance to discuss what you can expect this Holiday Season. Key topics include the challenges and shifting consumer behaviors shaping this holiday season, from declining in-store shopping to the impact of post-election uncertainty and evolving safety concerns.
From Thanksgiving to Cyber Monday, approximately 200.4 million customers shopped in person compared to 73 million online shoppers. Yet, the top-selling category in 2024 isn’t what you might expect—it’s food. Consumers are stocking up on candies, signature food items, and even smoked meats for themselves and as gifts, marking a shift from traditional favorites like gift cards, apparel, and consumer electronics.
Through these trends, Burt Flickinger illuminates how retailers are navigating the holiday season and how consumers are juggling the obstacles for everyday necessities as well as gift-giving.
2024 Retail Winners and Losers:
As quoted by Burt Flickinger, "If it's food, if it's necessary, it's a winner." Retail Grocers performing exceedingly well this Holiday Season include Kroger, Costco Wholesale, BJ's Wholesale Club, WinCo Foods, TJ Maxx, Burlington, Tractor Supply, and Dillard's. In addition to these retailers, Target saw record-breaking crowds this past Black Friday driven by the exclusive Taylor Swift album release, attracting many shoppers and potentially marking a "retail renaissance" (Burt Flickinger). Lastly, Urban Outfitters stands out as a retail winner -- with outstanding leadership, branding, and customer service, they make top charts for retail winners.
If it's not food, if it's not necessary, consumers are not buying. Department stores, Wearables, Dollar Stores, Chain Drug, and specifically Best Buy, Nordstrom, and Kohl's, are seeing a dip in Black Friday and Holiday Sales.
Holiday Trends, Declines, and Consumer Hesitations
For the first time, customer counts are significantly declining for Black Friday. However, Small Business Saturday, sponsored by American Express, continues to grow and promote local businesses supporting the backbone and foundation of shopping. A popular hashtag you might see is #shopsmall. SBS was expected to draw 64.4 million shoppers in 2024, generating nearly $201 billion in sales.
Retail Crime and Theft as a Top Shopping Concern
One major hesitation from consumers is the concern of safety. 25% of consumers express fear of shopping in-store due to the rising retail crime. Retailers like Target, Costco, and Kroger do an excellent job as safer options for shoppers.
Over the years and decades, retail theft has become an epidemic. Strategic Resource Group's team of experts deals with the damage caused to stores by crime groups, mobs, and thieves who grab products in plain sight. We offer precise solutions to fight against theft with loss prevention tactics, policies, and procedures.
How Declining Theater Revenue Impacts Holiday Shopping
A perfect day at the mall starts with a movie and ends with browsing the shops. However, this year, that classic experience is taking a hit. Movies are going to bring fewer customers to the shopping centers and malls. Movie theatre revenue is down by 30% (over $1 billion), going from $4 billion in movie ticket sales to $3 billion this year due to the perceived poor quality of Hollywood Releases.
Private Labels
Everyone is moving to private labels, as Dave Rinaldo mentioned at the Chicago PLMA—Private Label Manufacturers Association with the outstanding Peggy Davies. The Strategic Resource Group had an opportunity to attend the PLMA and connect with private label manufacturers. With decades of experience helping private label brands launch, our team has proven frameworks and procedures for developing your brand. From brand creation and developing your organization's strategy to advertising, marketing, and promotions, Strategic Resource Group guides you every step of the way.
Private labels are saving more money by offering better quality goods and a higher standard of living. Shoppers are spending less to get greater value. Grocers like ALDI and Kroger know how to save shoppers money. Kroger specifically has its own manufacturing plant, sourcing food from U.S. farmers and 35 food and beverage manufacturing plants. With Kroger's dedication to being fast, fresh, friendly and saving shoppers money as their top priority, private label sales are up significantly in addition to gross margins.
2024 Post-Election Holiday Trends
It is true -- the election is causing people to pause their holiday shopping. Not only is the current economic state putting fear into the American people, but it is also a recurring theme that many are just not buying -- instead, they browse.
Trump's Tariff Enactment
As the new administration enters office, we can expect short-term pain due to the high tariffs. Countries will receive a 200-500% tariff. However, the long-term looks brighter for the American people. Over the next 2-5 years, tariff reductions should lead to lower consumer prices.
Not all retailers will feel the weight of the tariff since some, like Kroger, BJ's, and Costco, are domestically sourced and will be less affected by tariff-related issues. Off-shore, dependent retailers like Walmart (80% of consumables) and leading department stores will face challenges.
2024 Holiday Wrap-Up
With 70% of consumers living paycheck to paycheck and families of five spending $9,000 more this year, many are holding off on their shopping. According to Burt Flickinger, savvy shoppers may hold off on spending between Black Friday and New Year, waiting until the New Year. Retailers will go into a "desperation discounting" phase, leading to some of the best bargains in history. Gift cards are recommended as practical purchases.
Burt Flickinger III is the CEO of Strategic Resource Group. He is widely regarded as the top consultant in retail. Burt has appeared before the Federal Trade Commission (FTC) on multiple occasions to offer his expertise, work, and testimony. He was a catalyst and key contributor to The Los Angeles Times' Pulitzer Prize-winning series "Walmart Effect."
Executives from leading U.S. and global investment firms, legal firms, CPGs, advertising agencies, retailers, and wholesalers have relied upon Burt's work to better understand and profit from the dynamics of retail across all business sectors.
Strategic Resource Group is the lead retail and brand CPG consulting firm throughout the United States and the globe. With more than three decades of experience, our team strategically collaborates with top retail chains, wholesalers, suppliers, and investment firms. Our retail industry experts are highly skilled at illuminating retail trends, identifying opportunities to increase consumption, and growing retail sales.
Stay in the loop with SRG’s latest news reportings as Burt Flickinger makes special appearances on the radio, TV, and a vast amount of other platforms. Explore the ways to drive your profitability, discover top resources, and uncover your competitive advantages!
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