If you received a great Christmas present last year, and are hoping for the same kind of treatment this year, don’t hold your breath — U.S. consumers are planning to spend conservatively this holiday season, according to two new surveys.

A Gallup poll found that consumers, on average, plan to spend $740 this year on holiday gifts. At this time last year, consumers said they planned to spend $801 on average. That number fell to $616 during a November poll, although it recovered slightly to $639 in a December poll.

The latest Gallup survey, which polled over 1,000 consumers from Oct 1-Oct 4, found that 33 percent of respondents said the planned to spend less this year on holiday gifts. Last year, that figure was 35 percent.

Apart from 2008, when retailers faced the toughest holiday shopping season in nearly four decades, Gallup said its 2009 spending outlook is the worst since mid-December 1991, when 33 percent of Americans said they would spend less on gifts than the year before.

The trend of paring back is the same among the nation’s elite.

A separate survey, which polled 684 people with an average income of $300,000 and net worth of $3.1 million, found that nine percent of those people said they would not buy any gifts this year. Three percent said they would spend more than they did last year, while 38 percent said they would spend less.

The survey, by the American Affluence Research Center, estimated this group of consumers would spend about $2,400 per household, on average, for holiday gifts.

(Photo: Reuters)

Check out retailers beating earnings expectations.

Today it is Family Dollar and Costco — both being places where people usually shop to save money.

Family Dollar saw sales rise in the quarter, though sales at stores open at least a year were less than expected as the company has been reorganizing its stores to stock more food and other items that shoppers want as they stick to necessities.

Costco sales fell and so did its profits, in part due to a stronger dollar, higher labor costs and also because of the weak economy.

But its earnings still beat Wall Street’s expectations and Costco’s stock rose in the morning.

Retailers will be heard from a lot this week as many report September sales.

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Coutu sees potential in Rite Aid stake (Globe and Mail)

Helen of Troy Q2 profit trumps Street

Louis Vuitton very optimistic on Christmas sales

(Reuters photo)

Check out Walgreen’s sales growth.

Walgreen Co, the largest U.S. drugstore chain, said on Friday that September sales at its stores open at least one year rose 5.3 percent, thanks to in-store flu vaccinations and people filling more 90-day prescriptions.

Sales of general merchandise, which consumers have been shying away from in past months, also rose for the first time since May for Walgreen.

Retailers began their seasonal flu vaccinations earlier than usual this year, amid raised awareness of the flu with the H1N1 pandemic. Pharmacy same-store sales rose 7 percent for Walgreen, with the number of prescriptions filled at existing stores jumping 12 percent, including 5.2 percentage points from pharmacists administering seasonal flu shots.

Walgreen, which administered 1.2 million seasonal flu vaccines in last year’s flu season, has already given more than 2.4 million this season and aims to administer 5 million.

But not all drugstores have reported such growth.

Rite Aid said on Thursday that its same-store sales fell 0.3 percent in the four weeks ended Sept. 26. Its pharmacy same-store sales rose 0.7 percent, while general merchandise same-store sales fell 2.3 percent.

Also in the basket:

U.S. September non-farm payroll plunges 263,000

Wal-Mart sees slow U.S. business recovery

Shareholder sues Cadbury officers over Kraft bid

Barbie, Beatles, guns to rule holiday toy roost

(Reuters photo)

Check out the sluggish sales at Walgreen.
 
People filled more prescriptions at the drugstore chain, but didn’t buy much else.  August same-store sales rose only 1.9 percent, less than analysts had anticipated.
 
While many retailers have been experiencing sales declines, drugstores have generally done much better because an aging population  has been buying more prescriptions drugs.
 
But Walgreen’s sales of general merchandise fell 1.3 percent.
 
That could be a bad sign for other retailers that report sales this week. Walgreen is the third-largest retailer that reports monthly sales, behind only Costco and Target.
 
Overall, analysts are expecting a 3.8 percent drop in same-store sales when retailers report this week.
 
Also in the basket:
 
Zale identifies prior adjustments, delays results
 
Jos A Bank Q2 results top Street

Brown-Forman profit tops view
 
Tesco uses weather to predict sales (N.Y. Times)
 
Retail theft soars in economic downturn (WWD, subscription required)

(Reuters photo)

Check out the lack of interest in pens and purses.
 
Retailers as varied as Coach and Office Depot reported lower quarterly sales, continuing to show that despite some forecasts that the recession may be at an end, consumers are cutting back on just about everything.
 
Coach sales fell 1 percent and profit, excluding one-time items, dropped 21 percent.
 
Sales at Office Depot fell 22 percent and the company posted a wider than expected loss, sending its shares down 14 percent.
 
Oh, and it isn’t just office supplies and fancy bags consumers are cutting back on.
 
Grocery chain operator Supervalu reported a 4.5 percent drop in quarterly sales as it cut prices to try to keep consumers from going to stores like Walmart.
 
Economists are looking for “green shoots” everywhere these days, but the consumer still doesn’t seem to be buying it … or anything.
 
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CIT courts creditors, plans large debt exchange
 
Under Armour posts surprise second-quarter profit
 
PepsiAmericas Q2 profit beats estimates, ups FY outlook
 
Italian group makes offer for Christian Lacroix (N.Y. Times)
 
(Reuters photo)

Check out Target maintaining retail margins.
 
That counts as a win in retail these days. The discounter was able to better manage markups and markdowns than last year, helping it keep gross margin steady, even though consumers are spending more on less profitable staples and less on discretionary items.
 
The company soundly beat analysts earnings estimates for the quarter. But profit still fell 13.3 percent in the quarter, not necessarily a good thing when you are in a proxy fight with an activist investor.
 
The story from Target was the same as the story from most retailers during this recession. Sales are sluggish or falling, they are controlling inventories and trying to rein in expenses.
 
AnnTaylor had the same story and reported a smaller-than-expected loss.
 
But it’s outlook was also cautious as the recession keeps women from buying work clothes and luxury apparel.
 
The question is, if consumers keep on the sidelines, how much more cost cutting can retailers do to limited the bleeding.
 
Also in the basket:
 
Tween brands posts narrower-than-expected Q1 loss
 
BJ’s Wholesale profit tops view; forecast raised
 
Sodas a tempting tax target (N.Y. Times)

(Reuters photo)

Check out signs of stabilizing demand at U.S. handbag and accessories maker Coach.

The leather goods company posted a lower quarterly profit, but said business was stabilizing at its North American stores at pre-December levels. The company has refrained from deep profit-sapping discounts in a strategy that has preserved the status of its brand but hurt sales.

Chief Executive Lew Frankfort said consumers have some optimism that the worst of the uncertainty is behind them and Coach has greater visibility into how shoppers will behave in the coming months.

Coca-Cola also reported a lower profit, but its results met analysts’ expectations. That came a day after rival PepsiCo posted a better-than-expected quarterly profit and offered $6 billion to buy the remaining stakes in its two largest bottlers as it seeks to better control its distribution and cut costs.

Signs have been mixed as some companies still point to pressure on consumers, and even top Federal reserve policy makers have different opinions.

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Chili’s parent Brinker posts quarterly profit

Wal-Mart China management restructuring hits snag

Target Corp board seat seeker calls for single ballot

Pepsi move could shake up U.S. drinks industry

Food Firms Cook Up Ways to Combat Rare Sales Slump (WSJ)

A New Approach: Spring Markdowns Sprout Early (WWD, subscription required)

(Reuters photo)

It looks like fewer people were willing to give up great skin than their favorite perfume in 2008.

According to a survey by research firm NPD Group, total U.S. sales of beauty products (sold mainly in department stores) fell 3 percent to $8.38 billion in 2008.

But perfume sales faced the steepest decline, falling 6 percent to $2.68 billion, with lower sales of both men and women’s fragrances. That was despite demand for higher-priced perfume gift sets and a 9 percent rise in new scents for women like Viva La Juicy and the Harajuku Lovers collection.

Makeup also faced a decline in sales — 3 percent — with weak demand for items for the face, eyes and lips.

““The economic realities of 2008 have created fundamental shifts in the behavior of our consumers and the way they approach beauty,” said Karen Grant, senior global industry analyst and vice president of beauty for NPD.

But take heart! Consumers still seem keen to flaunt good skin. Sales of skin care products were even with the year before at $2.4 billion, and captured 1 percentage point more market share of total beauty sales.  Anti-aging, allergy relief, and whitening or brightening products did particularly well.

Items priced above $70 and natural and spa-type skincare brands showed strong growth, the study showed.

(Photo/Reuters)

Check out Avon’s declining sales.
 
The world’s largest direct seller of cosmetics just spent however much money you have to spend to get an ad on NBC right before the Super Bowl, trying to recruit people to sell for Avon.
 
The pitch was that in these tough economic times, being  an Avon rep was a good idea. It’s a good way to earn extra money, and, since it was essentially your own business you couldn’t be fired, the commercial said.  

 
One question: who are all these new Avon Ladies going to be selling to?
 
The global economy is in tatters. Avon posted fourth-quarter profit below analysts expectations and sees more difficulty in 2009.
 
Sales fell 9 percent, though that was due to the stronger dollar. But even a 2 percent sales increase in local currencies was somewhat anemic.
 
So, who is Avon calling on?
 
Also in the basket:
 
Walgreen January sales up 0.4 percent
 
Liz Claiborne to cut 725 U.S. jobs
 
A CEO gets a rare second act (WSJ)

Check out people buying only what they use.
 
Remember when every time you went to the store you bought toilet paper, paper towels and other basics just so that you wouldn’t run out?
 
Well, those days appear to be gone.
 
As companies like Colgate-Palmolive and Procter & Gamble report earnings, one thing becoming clear is that consumers are now using up everything they have in their cupboards before buying replacements.
 
Call it “destocking,” “pantry deloading,” or “inventory drawdowns,” but whatever it’s called, it cuts into sales — for retailers and manufacturers. As consumers are using up the shampoo or soup they have on their shelves before buying more, retailers are also getting rid of excess inventory before buying more from manufacturers.
 
With the economy in recession, consumers have every reason to be frugal. On top of that, manufacturers have raised prices over the past two years in order to cope with soaring commodity costs.
 
But with fewer items being purchased, the next question is whether those manufacturers will have to lower prices to maintain market share.
 
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GDP sees biggest drop in 27 years
 
Unilever faces slowdown just as new CEO takes over
 
 (Photo: Reuters)