Happy Holidays Are Here Again According To
GfK Roper Shopping Outlook

Consumers Will Favor Discount Stores But Spend More

NEW YORK, December 5, 2006 – GfK Roper Consulting, a division of GfK Custom Research North America, today announced results from its annual GfK Roper Reports® Holiday Shopping Outlook that finds consumer confidence and holiday spending plans are on the rise. The report indicates not robust shopping, but a solid season, with 15% of Americans expecting to shell out more money and half of consumers saying they will spend at least the same amount this holiday period compared to last year.

Declining gas prices at the start of the season have loosened consumers’ purse strings.  Fewer consumers (35%) are feeling seriously crunched by fuel costs down 17% points from 2005 and more than half (52%) of respondents state prices at the pump will not limit how much they spend on gifts this year.

Spending is up and shopping lists are growing as well.  Consumers plan to purchase gifts for an average of 13 people, up from 11 last year.  Americans also say they’ll plunk down an average of $857 on presents for friends and family, up $77 from 2005.  Mid- to high-income Americans – and men in general – are planning to spend even more.  Households with a total income between $50,000-75,000 state they’ll rack up $971 in holiday shopping bills and families with over $75,000 plan to hit the $1,504 mark.  Similarly, male participants state they will spend $946 on gifts.

More Playing Santa Online
E-shopping continues its steady growth this season, with 39% of Americans planning to shop online, up 19% over the last three years.  Purchasing gifts over the Internet is most popular among affluent consumers (incomes $75,000/year and above) with 31% planning to complete half or more of their holiday shopping on the net.  Of the respondents who say they will e-shop, music, movies, and books (each 14%) top the list as the most popular online shopping categories.

“With gas prices decreasing in recent months, Americans are feeling some relief from the economic stress of recent years which has translated into increased spending,” says Kathy Sheehan, Senior Vice President for GfK Roper Consulting. “While the overall outlook is only slightly more positive than 2005, the highest income brackets will open their wallets wider than the rest, up an average $300 over last year. Look for the most growth in consumer and home electronics, the favorite spending segments of that population.”

Shopping Deadline…December 15 for Most
This year’s shopping shows signs of an early and prolonged peak.  Up nine points from 2005, 39% of consumers predict they will finish this year’s holiday shopping before November comes to a close and more than half of respondents (64%) say they will wrap up the spending season by December 15.

The Gift of Choice…Gift Cards Hold Steady
The GfK Roper Reports® Holiday Shopping Outlook found that gift cards are continuing to thrive as the gift of choice for those hard-to-shop-for friends and family members.  Although gift cards show little growth in 2006, they won’t lose any ground either, with two-thirds (66%) of shoppers planning to give at least one this year. More than half (59%) of gift card buyers will purchase music or bookstore gift cards, with consumer electronics and department store gift cards the next most popular choices.

Kids are most likely (43%) to receive gift cards, and half of all parents with kids ages 6 -17 are planning to purchase gift cards for their children. Other likely recipients include friends (41%), distant family (35%) and siblings (34%).

Big Box Stores the Hot Shopping Destination
Whether buying gift cards or traditional gifts, the majority (77%) of consumers, including high-income households, will rely on discount superstores to supply the bulk of their gifts. According to a separate study, the so-called ‘Big Box’ stores stand to gain the most ground with the often under-served Hispanic market. Through its GfK Hispanic OmniTel® Retail Study, GfK Omnibus Services found 35% of the U.S. Hispanic population list Wal-Mart as their store of choice listing low prices, convenience, a wide range of merchandise and Spanish-speaking sales associates as their top reasons for selecting which stores they will visit.

Survey Methodology
The GfK Roper Reports Holiday Shopping Outlook was conducted in October 2006 among 1,007 American adults ages 18 and up.  The GfK Hispanic OmniTel® Retail Study was conducted October11-18, 2006 among 502 American adults ages 18 and up.

About GfK Custom Research North America
Headquartered in New York, GfK Custom Research North America is a company of the GfK Group.  With home offices in Nuremberg, Germany, the GfK Group is among the top-five market research organizations in the world.  Its activities cover five business divisions: Custom Research, Retail and Technology, Consumer Tracking, Media and Healthcare.  In addition to 13 subsidiaries in Germany, the GfK Group has more than 130 subsidiaries and affiliates in over 70 countries.


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