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NPD: Holiday Shoppers Leaving CE Channel

11/08/2010 12:01:00 AM Eastern

PORT WASHINGTON, N.Y. — Fewer shoppers plan
to buy their holiday gift electronics at CE specialty
stores, a new survey by The NPD Group shows.

According to the research firm’s Annual Holiday
Survey, CE stores dropped from
fourth to sixth place on NPD’s top
10 ranking of retail distribution
channels, with only 19 percent of
respondents saying they plan to
shop there, down from 26 percent
last year.

The decrease jibes with an earlier
report by NPD showing that
intent to purchase CE products
as holiday gifts dropped from 24
percent of respondents last year
to 16 percent this season.

The CE specialty channel was
bested by discount stores (54
percent), e-tailers (35 percent),
national chains (29 percent), department
stores (22 percent) and
toy stores (20 percent), the survey
showed, but led warehouse clubs
(17 percent), outlet stores (16
percent), apparel shops (15 percent)
and off-price retailers (13
percent).

All distribution channels
showed varying degrees of erosion,
although the results are
not necessarily indicative of an overall decrease in
planned holiday purchases, NPD said.

“Last year consumers wanted to spend as little as
possible on gifts,” explained NPD chief industry analyst
Marshal Cohen. “This year they are being more
selective about where they spend.”

Consumers also ranked value (60 percent) and a
special sale price (58 percent) as the top two factors
influencing their choice of retail venue. Of lesser
importance was convenience of location (47 percent),
quality of products (42 percent), free shipping (39
percent), hassle-free returns (36
percent), breadth of selection
(35 percent) and advertising/circulars
(30 percent).

“Forty-four percent of consumers
told NPD they plan to look
around for the best price and value
before they buy, which could
benefit online sales,” Cohen
observed. “As consumers ‘presearch’
by scouring websites for
the best prices and deals, they
will likely discover that shopping
online offers not only competitive
prices but a whole lot more convenience
and they decide to buy
online.”

The report, “The NPD Holiday
Survey of Consumer Purchase
Intentions,” mirrors a holiday
study released yesterday by the
National Retail Federation (NRF)
showing a shift away from CE
stores and electronics gift giving,
but conflicts with the Consumer
Electronics Association’s
(CEA’s) 17th Annual CE Holiday
Purchase Patterns Study, also released yesterday,
which forecasts record CE spending and an increase
in electronics’ share of holiday expenditures.

The NPD report is based on responses to a survey
conducted Sept. 7-15 from more than 2,000 members
of the firm’s online consumer panel.