Deals and Discounts: What Trump's Win Could Mean for Holiday Sales

By Published on .

Gap_Store
Gap_Store Credit: Wikimedia Commons
Most Popular

Early holiday sales predictions may be need to be recast as retailers wait to see what impact Donald Trump's victory will have on consumer confidence. Already, the retail environment has been heavily promotional as brands try to reverse sales declines from earlier in the year and last holiday season. Last month, the National Retail Federation predicted a 3.6% rise in retail sales this November and December.

But with the economic seesaw immediately following the election -- after an initial plunge, world markets stablized -- some analysts expect shoppers to be cautious in their spending, which will likely prompt retailers to ramp up their holiday promotions and discounting. Of course, such discounts to capture more customers would come at the expense of brands' profit margins.

"If retailers pick up on the cautiousness around consumers, they could start to promote and market more heavily to get those sales," said Neil Saunders, managing director at retail research consultancy Conlumino. "It wouldn't be good for retailers as it would hurt their margins, but it would be good for consumers who could find more discounts and deals."

On Wednesday, retailers including Gap Inc., Macy's and Toys R Us blasted email subscribers with deals ranging from 15% to 40% off. Wayne, NJ-based Toys R Us promoted a two-day "Big Brand Blitz" sale lasting until Thursday.

Along with a potential short-term softening of holiday sales, some retail experts also predict consumers will delay any big-ticket investments, like buying a house or car, until the economy is more certain.

Of course, not everyone was holding off their purchases, but for a variety of reasons. Following the election outcome, Twitter user Ariana Cristina tweeted "There's this new bag at @HenriBendel I want and I feel like today is a good day for retail therapy."

Greg Portell, lead partner in the retail practice of consulting firm AT Kearney, noted that realistically, any personal connection felt by consumers won't be felt until January.

"Retail spending is tied to people's personal situation and we just had an election where personal wishes came through," he said, noting that the firm recently found that 68% of shoppers planned to spend the same amount post-election regardless of a win by Hillary Clinton or Mr. Trump—the finding is part of an upcoming study on 2016 holiday spending.

Early Wednesday, the NRF issued an optimistic statement congratulating Mr. Trump.

"The next few months will offer many opportunities for us to educate lawmakers on our priorities, such as tax reform and investment in our nation's infrastructure, as well as pro-growth policies that create jobs and reward capital investment," said Matthew Shay, NRF president and chief executive, in a statement. He added that he hopes "pragmatism will prevail over ideology" as Mr. Trump staffs his administration.

In this article: