(Chicago; November 18, 2002; PRNewswire) According to the 17th annual Deloitte & Touche Holiday Retail Outlook survey, 91 percent of respondents in Chicago plan to spend the same or less this holiday season compared to last. On the brighter side, the poll of nearly 500 people in the Chicago area between November 1 and 5, confirms that despite overall concern about the economy and job security, Chicagoans will open their wallets to spend money close to home. The average amount Chicagoans expect to spend ($1,849) is significantly higher than the national average ($1,625).

Deloitte & Touche conducted this year's annual survey against a backdrop of cautiously improving economic indicators squaring off against low consumer confidence numbers. With the holiday shopping season shifting into high gear, Deloitte & Touche LLP expects a warming trend in consumer spending to drive modest retail sales growth. The firm's Consumer Business Practice anticipates a three to four percent increase during November and December in the important General Merchandise, Apparel and Home Furnishings (GAF) sales figures. Last year, GAF sales rose 5.6 percent during the same period.

"Based on the survey, Chicago appears to be taking a slightly more cautious approach to holiday spending than our coastal counterparts," noted Stacy Janiak, Deloitte & Touche partner and a leader in Deloitte & Touche's Midwest Consumer Business Practice. "Although the average amount that we plan to spend is higher than the national average, we are spending less when compared to other large metropolitan areas like Los Angeles, Boston and New York, where consumers plan to spend an average of $1,858, $1,920 and $2,044, respectively."

Continued recessionary markets, concerns over international conflicts, rising oil prices, job insecurity and increased consumer debt stand to have a large impact on how local residents spend their money this holiday season.

Focus on Home

"Like many other cities around the country, Chicago has seen continued corporate layoffs over the past year, which will have a clear influence on holiday spending," said Janiak. "This doesn't mean that consumers will drastically reduce their purchasing, though. Instead, Chicago shoppers indicate that they will spend their money on items to be enjoyed in and around their homes. It appears that local residents are recuperating from the tough economic year by staying close to the nest."

Chicago's sustained healthy housing market fueled by the lowest mortgage rates in years may also affect how people spend their hard-earned cash this year.

"Our survey shows that an average of $564 -- a full 30 percent of the amount consumers in Chicago plan to spend this year -- will go towards home improvements and home furnishings," said Janiak. "Consumers' general intention to use their holiday gifts as a means to improving and enjoying their homes is consistent with the local home purchasing and mortgage refinancing activity. People recognize the long-term value of spending money on home improvements versus the short-term value of many other types of holiday gifts."

Convenience is Key

Chicago shoppers also have their sights set on convenience paired with value, as demonstrated by where they plan to purchase their gifts. In last year's survey, discount retailers were the clear winner, and they retain their first-place ranking this year, increasing to 67 percent from 64 percent of consumers planning to shop the discounters. Home electronics stores and the Internet tied as the second most popular channels for local shoppers, with 50 percent of local consumers planning to purchase gifts through these outlets.

"It's clear that shoppers in Chicago crave convenience. Discount stores, home electronics stores and the Internet, in addition to an increase in shopping at warehouse clubs, all qualify as channels where shoppers can get a wide variety of items in just one visit," said Gary Levin, a partner in Deloitte & Touche's Midwest Consumer Business Practice and co-author of the Bank One / Deloitte & Touche Retail Benchmarking Study. "One-stop-shopping is definitely popular in Chicago."

Levin noted that consumers are becoming increasingly Internet savvy year after year, along with Internet retailers providing improved service to the consumer.

"Each holiday season more local consumers plan to purchase gifts online. This year is no different, as 50 percent of local shoppers are planning to buy gifts on the Internet, up from 47 percent last year," said Levin. "For the Internet retailers who survived the dot-com shake out, this small but steady rise in usage, coupled with limited competition, could position them for their best holiday season yet."

A large increase in the portion of holiday budgets spent on gift certificates is another indication that local consumers want convenience. Gift certificates came in as the second most popular gift category in Chicago this year, behind clothing, with 60 percent of consumers planning to purchase gift certificates.

Levin noted increased gift certificate sales could be an added bonus for retailers because of boosted sales in the post-holiday period, as history shows certificate holders frequently spend more than their voucher's value.

Winning Retail Strategies

Based on the consumer survey, the winning retailers for this holiday shopping season will be those that offer the most convenience combined with the highest value for the money.

"Chicago shoppers are more concerned about their time and the purchasing power of their dollars versus prices paid," said Janiak. "Value and convenience were equally rated as the most important reason for choosing a retailer, garnering 27 percent each of the local respondents."

About Deloitte & Touche

Deloitte & Touche, one of the nation's leading professional services firms, provides assurance and advisory, tax, and management consulting services through nearly 30,000 people in more than 100 U.S. cities. The firm is dedicated to helping its clients and its people excel. Known as an employer of choice for innovative human resources programs, Deloitte & Touche has been recognized as one of the "100 Best Companies to Work For in America" by Fortune magazine for four consecutive years. Deloitte & Touche refers to Deloitte & Touche LLP and related entities. Deloitte & Touche is the US national practice of Deloitte Touche Tohmatsu. Deloitte Touche Tohmatsu is a Swiss Verein, and each of its national practices is a separate and independent legal entity. For more information, please visit Deloitte & Touche's web site at www.us.deloitte.com .