Tidings of Tight Wallets: BRG’s 2024 Holiday Outlook for Retailers

BRG’s Retail Performance Improvement team expects holiday sales results to be muted, primarily driven by a cautious consumer. Around 3 percent above last year’s season, we project that this holiday’s season will be slightly above the current rate of inflation. The most important takeaway: the landscape is poised for a wide variation in performance with a clear distinction between winners and losers across sectors and retailers.

Consumers below median income grapple with the effects of inflation and reduced share of wallet on discretionary spend, while consumers above median income have largely managed well—yet still plan to spend the same for the holidays as last year.

Retailers also will experience different holiday seasons depending on their ability to successfully target consumers. As retailers prepare for the upcoming holiday season, we propose five key strategies:

1. Refine inventory placement
2. Launch timely and targeted promotions
3. Manage store labor efficiently
4. Alleviate supply chain constraints
5. Manage shrink and returns effectively