Know It All 1.Bah humbug  It was a season of records ... of the wrong kind. The retail industry suffered its biggest ever year-on-year decline for the Nov. 1- Dec. 24 period, with sellers of luxury items (down 34 percent) leading the way. Among other noticeable numbers, the consumer confidence index hit a record low, retailers cut prices deeper and earlier than ever before (JC Penney slashed its diamond jewelry prices by 50 percent) and “wardrobing” surged.   SOURCE: RAPAPORT NEWS, 01/03/09      2. The lipstick effect  There were also other indicators that things weren’t too healthy. Sales of solitaires fell in favor of more, smaller stones in engagement rings, “fashion jewelry” sold well as did lipstick. (When things are bad, consumers cheer themselves up with less extravagant items. It’s known as the “lipstick effect”). Got a jewelry equivalent of lipstick in your store?  SOURCE: WALL STREET JOURNAL, 12/11/08      3. ‘Cheap is cool’ in ‘09  Out of the retail rubble emerged a new luxury consumer. It was a shopper with a mission, one who is very budget conscious, has done her research and wants the best deal. The NRF said the overriding trend for 2009 could best be defined as “cheap is cool.”  Sources: CNNMONEY.COM, NRF, 12/15/08       4. Gifts from the dead   Some retailers sought to take advantage of failing competitors by offering to accept their gift cards as discounts against purchases. Yet others, including Signet Jewelers, blamed GOB sales for their sharply reduced profits.  SOURCE: NORTH CAROLINA'S NEWS & OBSERVER, 12/12/08      5. Post-Christmas letdown   The traditional post-Christmas lift from gift cards evaporated amid (mostly unfounded) fears among consumers that the card seller might go out of business, making the card unredeemable. A Deloitte consumer survey found that shoppers would spend only $151 on gift cards this season, down 24 percent from last year.  SOURCE: WALL STREET JOURNAL, 12/12/08      6. Discount lobby  A group of major retailers, including eBay Inc. and Costco Wholesale Corp., called for new laws blocking manufacturers from setting minimum prices on everything from flat-screen TVs to power drills to jewelry.  SOURCE: WALL STREET JOURNAL, 12/03/08      7. NRF seeks tax relief  The National Retail Federation asked then President-elect Barack Obama for a series of national sales-tax holidays to help rebuild consumer confidence and spending. The NRF proposed 10-day sales-tax-free periods in March, July and October. We can only hope Obama is more sympathetic to the idea than New York Governor David Paterson. He proposed a 5 percent extra sales tax on luxury goods, including jewelry priced above $20,000.  SOURCE: INSTORE, 12/23/08      8. Plastic not so fantastic  Consumer credit is getting tighter, but just how tight? The U.S. credit-card industry may pull back well over $2 trillion of lines over the next 18 months due to risk aversion and regulatory changes, leading to sharp declines in consumer spending, prominent banking analyst Meredith Whitney said.  SOURCE: REUTERS, 12/01/08      9. Upwardly mobile   Mobile shopping was the big tech trend of the season, with growth in online shopping via phones fast outpacing that done through PCs. Mobile-marketing firm Mobigosee suggested designating a day called “Mobile Tuesday.”  SOURCE: AD AGE, 12/23/08      10. Gold tops platinum  The price of platinum fell to gold’s level in mid-December, ending a miserable year for the white metal — it lost half its value — and a volatile one for all precious commodities.   SOURCE: BLOOMBERG, 12/31/08  Back

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