NRF: Direct Retail Sales up 18.1% in December Vs. Stores' 2.2%

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While store-based retail performed the worst since the National Retail Federation started tracking holiday sales in 1992, direct marketing again came to the rescue.

According to numbers released yesterday, holiday retail sales for November and December was up a mere 2.2 percent for stores in the general merchandise, clothing and accessories, furniture and home furnishings, sporting goods, hobby, book, electronics and appliances and music categories.

By contrast, online and catalog retail sales rose 18.1 percent unadjusted for the year and 3 percent seasonally adjusted month-to-month.

"What it comes down to is six fewer shopping days, the bad weather and a cautious consumer. It was a little bit too much for retailers to overcome this year," said Scott Krugman, senior director of public relations at the NRF.

The NRF, which is holding its 92nd Annual Convention & Expo in New York through today, originally had forecasted holiday sales would grow 4 percent. It later lowered those projections to 3.5 percent.

It did not help that this holiday season was one of the most promotional on record. So it was no surprise that retailer margins were eroded.

"Retail discounting was so much that consumers could buy the same amount of merchandise and spend less for it, and that brought down their spending," Krugman said.

Of course, in the rush to crown the Internet king, it must not be forgotten that the channel is new compared with stores.

Online is expected to account for 3.2 percent of all retail sales. "That's the projection by," said Ellen Tolley, media relations manager at NRF. is an NRF-owned trade association for Internet retailers.

Krugman agreed with Tolley's assessment.

"Online accounts for such a small percentage of retail sales of retail sales," he said, "and it's in its infancy, so there's nowhere to go but up."

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