I. Abstract
There are many reasons why we give gifts today for birthdays, weddings, graduations, etc. to friends and loved ones. A few reasons we give gifts is for peace, protection, love, or because of social obligations. Holiday gifting is a special occasion going back to the beginning of Christianity where the Three Wise Men brought gifts for baby Jesus. This gesture has now turned to giving gifts to our family and friends.
The holiday season of 2014 is shaping up to be a prosperous year for retailers. With an estimated 4% increase in holiday sales compared to 2013 and consumer confidence is at its highest because of lower unemployment, higher wages, salaries, and disposable income. Consumers this holiday season are expected to spend approximately $804 on gifts. Along with lower gas and energy prices, consumers are more likely to spend more this holiday than the last on gifts like Disney Frozen Snow Glow Elsa Doll, Apple iPhone 6, and jewelry.
Key promotions like Wal-Mart’s price matching policy, Kmart’s layaway service, USPS delivery service schedule hours expansion, the holiday season looks to be headed in a positive way. There are other ways to improve this holiday seasons like online retailers providing free shipping on all purchases or discounting newer products instead of outdated items. The holiday season will be promising! Even 2015 holiday season will be a good one as long as consumers are confident that the U.S. economy is recovering from the recession!

II. Introduction
The world is populated with many different ethnicities, age groups, and various education levels. Although there may be many differences between the groups of people in the U.S, giving gifts to friends and family during holidays is a long-time tradition participated by every group no matter what culture they come from.
The idea of holiday gifting had started many years ago and has evolved today into a marketing boom! Based on the data collected from the National Retail Federation, U.S. consumers are expecting to splurge more on friends and family this holiday season. These consumers will be looking for the best deals available which they will either online or at their local stores. Businesses are well aware of this holiday gifting craze and are already targeting consumers to buy early this year with holiday ads coming out as early as October to buy hot items like Christmas trees! Businesses will try their best to win over the hearts of their customers with deals on goods that are not as popular like Mattel’s Barbie.
Just how will this holiday season turn out? Best bet is better than 2013 holiday season! As the U.S. economy is finally showing signs of coming out of a recession, with employment rates increasing and consumer confidence at the highest it has been in a year, this holiday season is looking to be quite profitable and expect to see better profits for next year.

III. The Tradition of Gifting
Before we can dive into the main topic of this holiday market, let’s first dive into understanding the tradition of gifting. According to Merriam-Webster dictionary, a gift is an item or thing which is given to another person or to a group or organization. Gift giving has been a staple throughout the U.S. history such as giving gifts to Native American Indian tribe leaders as a way of respect, as a wedding present for a newlywed couple, as a birthday or congratulatory gift. Let’s face it there are many reasons as to why people give gifts and some of the main reasons can be for peace, protection, love, or because of social obligations.
The holiday tradition of gifting at during the winter season has been around for quite a long time. This tradition has existed since the beginning of Christianity. When the Three Wise Men came and visited Mary and Joseph on the birth of their new born, named Jesus, these men presented Jesus three gifts. The gifts were frankincense, gold, and myrrh, each gift having its own symbolic meaning. Frankincense meant that people will worship Jesus. Gold represented that Jesus will be king and Myrrh meant that Jesus will suffer and die.
However, gifting no longer just pertains to worshipping Jesus. We now celebrate holiday gifting during the winter season, fourth quarter of the year, to express our love, thoughtfulness, and appreciation for the ones we love, our family and friends. This tradition of gifting during the holiday sales accounts for nearly one-fifth of annual sales which means the holiday season draws more sales than Mother’s Day, Father’s Day, Valentine’s Day, Halloween, Easter, and St. Patrick’s Day combined! (Grannis, The Holiday Survival Kit 2014, NRF, 2014)

IV. Economic Climate
The 2014 holiday season is looking promising with an estimate of $616.9 billion in holiday sales, an increase of 4.1% (Grannis, The Holiday Survival Kit 2014, NRF, 2014). We can assume the U.S. economy is coming out of the recession and going into post-recession highs. The average increase in holiday sales for the past 10 years was about 2.9% (Grannis, The Holiday Survival Kit 2014, NRF, 2014). Although there was a 0.2% fall in consumer spending in September, the first drop in eight months, U.S. consumer spending is still increasing at a steady 1.8 percent clip.
Due to economic change, holiday gift givers are expected to spend more this year on gifts which is estimated to average about $804 which is up nearly 5% from the $767 in 2013 (Malcom, USA Today, 2014). With a consumer confidence level reading of -12 in October, the highest in over a year, American consumers are changing their perspective of the U.S. economy as becoming overall “better” (McCarthy, U.S. Economic Confidence Index Highest in Over a Year, Gallup, 2014) and along with the perspective they are willing to spend more this year.
Not only is that positive news, we are seeing unemployment rates going down. For example, in October, unemployment rate was down almost 5.8% (U.S. Bureau of Labor Statistics – The Employment Situation, October 2014) and there are estimates of new seasonal job additions from 725,000 – 800,000 job (Grannis, The Holiday Survival Kit 2014, NRF, 2014). With more people employed, we can expect and increase in holiday sales this season!

V. Consumer Spending / Consumption Climate
This holiday season is already underway with 80% major purchase holiday shoppers researching deals online; 60% visiting retailer websites and 42% visiting review sites to find information on a product brand, or retailer (Cautious but Climbing, Synchrony Financial, 2014) as early as September! Why are they shopping earlier? This could range from a multitude of reasons such as avoiding holiday crowding or finish their holiday shopping early. Even businesses such as Walmart, Macy’s, Micheal’s, etc. are fully aware of this and taking measures to bring out holiday promotions early in the holiday season to draw in those early holiday shoppers. Historically, four in ten holiday shoppers began shopping for holiday gifts before Halloween each year. Statistics show 12.4% begin before September, 20.6% begin in October, and 38.8% begin in November! (Grannis, The Holiday Survival Kit 2014, NRF, 2014)
Consumer confidence and willingness to make purchases are on the rise based on Synchrony Financial’s survey which showed four out of ten consumers were willing to purchase $500 or more within the next 12 months, which is up from 33% last year, and a quarter of random shoppers were open to using financing solutions to make their major purchases, a 12% increase year-over-year (Cautious but Climbing, Synchrony Financial, 2014). Watch out jewelers!
If sales holds true similar to last year’s holiday season, we can predict that the holiday gifter will be spending more on jewelry and electronics this year. Jewelry had the highest percentage of sale last year of 28% while electronics store received 23% of their annual sales during November and December of 2013. According to the NRF’s survey, 56% of holiday shopper are planning to spend more time online researching deals and buying gifts which is up 4.5% from last year and the highest it’s ever been (Grannis, Gift Givers Plan to Splurge on Friends, Family this Holiday Season, NRF, 2014).

VI. Holiday Predictions for 2014 and Why?
53% of the U.S. consumers believing that the U.S. economy is recovering from a recession and 8% believing the economy is healthy, Deloitte predicts that this holiday season will show a 4% growth (Paul, Sides, Hogan, Deloitte’s 2014 Annual Holiday Survey, pg. 6, 2014). This is similar to the National Retail Federation prediction which they estimate the holiday sales will grow by 4.1%. Both companies are optimistic about the 2014 holiday season because income, wage, and job growth are all on the uprise, debt levels are at historic lows, stock market gains and rising home prices are expected to boost spending. With real personal disposable incomes growth of 2.7% and wages and salaries increasing by 0.8 last quarter, consumers are more likely to be willing to spend a little more this year on gifting (Rosenburg, Holiday Shopping Season: Can Consumers Carry the Economy).
Deloitte also contributes lower gas prices, which are cheaper by approximately 15 cents per gallon then last year and as low as they have been in about four years, to help contribute to the positive holiday prediction (Gustafson, No coal here: Holiday Forecast calls for 4% growth). Though the effects of lower gas and energy prices is not yet evident in the holiday data, we can assume that this could give consumers a holiday spending boost. In the last quarter alone, consumer spending on gas fell by $7 billion! (Rosenburg, Holiday Shopping Season: Can Consumers Carry the Economy). This is money consumers are either saving, using to pay off debts, or able to spend for other purchases such as gifts. However, not everyone thinks this holiday season will be fruitful! Considering the deals and promotions coming out early in September or October, holiday shoppers are most likely going to spend as little as they can. This is a belief of Robin Lewis, the author of the The Robin Report online newsletter, which leads to his belief that this holiday season will have a zero growth!

VII. Key Holiday Promotions?
Among many holiday promotions, one big promotion is Walmart’s price-matching promotion in which they formally introduced allowing price-matching to Amazon’s prices in hopes of engendering goodwill and possibly loyalty with its customers. (Vigna, Wal-Mart Really Wants Your Business This Holiday Season). Not only are they price-matching Amazon, but they plan to roll out more in-store price reductions this holiday season!
Amazon will not sit back and watch Wal-Mart or other retailers win their potential business. Amazon is fighting back by promoting specific products at different times of the day or week. Amazon’s hope is to keep customers excited and coming back to their website.
Kmart also had a really interesting and early holiday mind-sticking ‘anti-Christmas’ commercial. Though the message throughout the commercial was ‘this is not a Christmas commercial’, it had big Christmas theme! However, Kmart’s main purpose in this commercial was to advertise its great layaway service that cash-strapped consumers can use to buy gifts in September (this is when the ad was released) with no money down promotion and pick them up right before that special December holiday (Berk, Kmart’s first Christmas ad of the season? You decide, 2014). With a little laughter and fun, this holiday promotion is one not soon forgotten!
Let’s not forget about the U.S Postal Service promotion. With the holiday season on the rise, USPS is expanding its holiday delivery service schedule to deliver packages seven days a week in some cities! With expectations of more than 15.1 billion cards, letters, and parcels including 470 million packages, it’s no wonder they are expanding its schedules! After UPS and Amazon failed to deliver packages in time for Christmas last year, USPS is making sure they will not make the same mistake! For this holiday season, Amazon and USPS has teamed up to perform Sunday deliveries. (Wallace, Postal Service launches Sunday delivery for the holidays, 2014).

VIII. Merchandise (Goods & Services for Sale): What’s HOT & NOT Items? (with emphasis on HOT)
So what’s hot this holiday season? With hit movies like Disney’s Frozen and the LEGO Movie, we are expecting Disney Frozen toys and products like Jakks’ Snow Glow Elsa Doll to be a major hit with the little girls this year and Lego toys to be a hit among the little boys. Not only are this year’s top hit movies a key trigger to predicting hot holiday items, predictions can be made based on past years consumer behavior and the increase of mobile phone usage that electronics will be a hit as well.
Holiday consumers will be drawn to this year’s latest release of Apple’s iPhone 6 and iPhone 6 Plus! Being one of the first smartphone providers, Apple has made a brand that is too be reckon with that consumers just cannot get enough of! Just late October, Apple announced strong fiscal fourth-quarter earnings and revenue selling 16% more iPhones compared to last year. While Apple’s iPhone 6 is doing well, Apple’s iPad is not looking too popular whose sales have dropped for the third consecutive quarter and fell below Apple’s Mac revenue (Tibken, iPhone 6 promises happy holiday for Apple). With the lack of real change on Apple’s newly release iPad, it is no wonder demand for the iPad has not increased. Let’s not forget about the women this year. Jewelry is also high on the consumer holiday wish list and based on the NRF 2014 Holiday Consumer Spending Survey, 24.8% of consumers are wishing for jewelry. This is up 1.5% from the previous year! Not only is jewelry on the hot list, so are gift cards which 62% of consumers say they want followed by clothing. But, of course, the best HOT item next to gift cards that is on everyone’s wish list this year and every year is money!
But, what’s not looking too promising this year? One product is Mattel’s Barbie. Though she just recently has been revamped as a Computer Engineer, Barbie’s sales are dropping. If Mattel cannot step up and fix Barbie’s image to something new and better, sales of Barbie dolls will certainly drop. Honestly, what mother would be happy to be give her daughter a Barbie who seems to be ‘inept’ which is how Barbie was recently portray in her new book “Barbie I can be a Computer Engineer”. Some consumers may disagree on this as they may interpret Barbie’s story in a different light, but only time will tell. Another holiday gift that is not too popular is computer or video games with its 10% consumer demand. This places the games in second after other games, toys, dolls, etc. (Paul, Sides, Hogan, Deloitte’s 2014 Annual Holiday Survey, pg. 8, 2014).

IX. Overall Evaluation / Conclusion?
The overall evaluation of the 2014 holiday season is that it looks promising! With employment rates, wages, income, and personal disposable income going up, the holiday season should see more consumers coming out to retail, department or online stores to purchase gifts and more! Consumer confidence is definitely increasing as they are seeing signs of the U.S. economy finally reaching post-recession highs. Along with lower gas and energy prices, consumers have less to fear and more money in their pockets for gifting.
With great promotional deals released as early as September, holiday shoppers are able to spend more time researching better deals prior to making their purchase online or at the brick-and-mortar stores! This allows retailers to start bringing in holiday revenues to their stores much earlier. A few main reasons for this is because holiday shoppers may want to get their holiday shopping done early to spend more time with their family this holiday season, avoid the holiday rush or lines, and potential prices and promotions earlier in the season are too good to pass up! One great promotion the holiday gifter be sure to take advantage of is Wal-Mart’s price-matching policy and Kmart’s layaway service! With USPS holiday delivery schedule expanding, the consumer will definitely be well-pleased!

X. Recommendations to Improve this X-Mas Shopping season?
To improve this holiday shopping season, retailers can offer free shipping on any purchases rather than just making free shipping a courtesy for consumers who spend an ‘X’ amount of dollars at their online stores. Online retailers could offer more detailed reviews and pictures of their product for consumers to review to give the online shoppers a better understanding of the product. Also, online retailers could also benefit by mirroring Staples.com, who offers discounts on products consumers have in their online shopping cart during their browsing session online. Brick-and-mortar stores could definitely benefit by expanding their store core hours to open much earlier and stay open longer during months like September and December due to surveys show consumers start holiday shopping as early as September.
Another viable option is to rethink the products being discounted during the holiday season, change up the products to get more consumers to come out. An example is to replace a cheaply discounted and outdated television with a moderately better television with a modest discount. And like Kmart and USPS, retailers can improve on services they already offer like faster In-Store Pickup times.

XI. X-Mas 2015, a Forecast & Why?
My forecast for the holiday season of 2015 is the next season will be better than 2014! With the U.S. consumers believing the economy is just now coming out of the recession, we can expect that consumer confidence to increase. With an increase in confidence, consumers will be more likely to increase their holiday spending budget because they will expect higher wages, incomes, and disposable income with the recovering economy. Not only that, but job availability should increase and these newly employed or reentrant job seekers would add to the overall spending of the U.S. economy including spending during holidays.
To make the 2015 holiday season an even better success, we should focus on what businesses can do to draw people to their stores like providing more research material for their products through email, catalogues or even online videos for consumers to review. Businesses can change their holiday store hours to match the holiday shoppers buying schedules, open early and stay open later in September through January. Also businesses can focus on the upcoming aspect of more online shopping and prepare for the increase in the demand of products ordered online to make sure items are delivered on time and maybe even quicker if weather allows. For brick-and-mortar stores, they should have a variety of exclusive in-store items that they advertise to draw in the customer to actually come to the store to see, try, and/or purchase.