Following strong turnout on Black Friday weekend, Customer Growth Partners is raising its already optimistic holiday forecast. The firm which previously predicted that US retail sales would rise 2.4% during November and December combined, is now saying that it expects a 2.6% sales gain.
By way of comparison, the National Retail Federation is forecasting a 1% decline in sales this year; Deloitte LLP foresees a flat season; and ShopperTrak RCT is predicting a 1.6% sales increase. “There’s a herd mentality in forecasting,” says Craig Johnson, president of Customer Growth Partners. “We don’t let other forecasters influence us. We do our own thing.”
Johnson says that during the month of November, culminating in Black Friday weekend, analysts throughout the country were doing store checks at malls and off-mall shopping centers. Based on their observations, the company decided to upgrade subsector forecasts for toys (from 6.7% growth to 7.2% growth) and home improvement (-10% to -6.6%). Ultimately, that raised the entire forecast by 0.2 percentage points.
Since the season is already more than halfway over, we asked, what is the point of updating? “We always do a pre-season forecast then a mid-season update,” says Johnson. Because clients rely on more granular forecasts for particular industries or companies, Johnson says he updates the big picture by combining those numbers for the purpose of accuracy, even though it might be too late to change holiday plans at this stage in the game.