Seasonal Shopping Hoopla Results In Biggest Post-Holiday Retail Depression In Years

The malls are hushed, the streets of city shopping districts have stopped humming and the online buyingpalooza has slowed. Yep, it’s that time of the year after the holidays when everyone is finally done shopping. Unfortunately for retailers, they’re facing the biggest post-holiday depression since 2009.

Reuters says early in the new year is always a slow time for stores, after the immediate post-holiday sales are over and shoppers have thrown in the towel. This year it’ll take even longer for consumers to pick up the pace again, however.

After splurging so much this holiday season, consumers still wary of the economy will cut back on spending now, say experts, in order to pay off credit card bills from the holiday shopping rush.

“The first and second quarters this year will see a deeper low than last year. Sales in the week after Christmas were so strong that took a bite from January,” retail consultant Jan Kniffen told Reuters.

He says shopping traffic will likely be down 2-3 percent, whereas last year it stayed about level or even improved a bit from the year previous.

Because consumers were finally gaining confidence back in the wake of the 2008 recession, more shoppers used their credit cards, said a study by America’s Research Group. That same surge will cause sales to plummet now that the holiday shopping is over and credit card bills start to arrive.

Things might be okay for retailers throughout January as gift cards are redeemed and items are exchanged or items go on clearance, but February will most likely suffer from the lack of fresh incentive to shop.

Holiday hangover means slow 2012 start for stores [Reuters]