The holiday season is built on spiritual foundations, but it relies on pragmatic shoppers’ spending to drive December’s all-important retail economy.
Two Harvard Business School professors, Nancy F. Koehn and Rajiv Lal, have weighed in on the Harvard Business School Web site with their best estimates of how the holiday shopping season will play out. One sees a flat or slightly improved sales period, while the other is guardedly optimistic.
“After the shock and awe of last year’s financial crisis, households are taking stock, abandoning the ‘next new thing’ in favor of more-enduring priorities, and establishing distinct notions of value from those that have prevailed during the last decade,” said Koehn, the James E. Robison Professor of Business Administration. “All of this adds up to the New Normal.”
Lal, the Stanley Roth Sr. Professor of Retailing and co-chair of the General Management Program, sees some blue patches amid the economic clouds. “While credit is still not easily available, the increasing savings rate over the last year should leave us with more to spend this holiday season,” he said. “Therefore, forget about last year’s Scrooge-like retail results. I expect this season’s sales to be significantly improved.”
— Jim Concannon