The early predictions were gloomy: the recession gripping the U.S. would make for a dismal holiday shopping season for retailers.  And while many retailers certainly felt the effects of the economic downturn, holiday dollar sales in 2008 actually increased 5.8 percent or $99.5 billion across grocery and drug stores, mass merchandisers and convenience stores, according to Nielsen.
Categories that drove the highest sales spikes were musical instruments and accessories, with more than half of the purchases for the year made in the last eight weeks of 2008.  Women’s and children’s fragrances, baking …

According to Nielsen, discretionary shopping trips continued to decline dramatically in November, as consumers shifted purchases online and to value-oriented retailers.
Overall in November, trips to retailers declined by 2.9% from the previous year.
Retail Channel Trends
Toy stores, electronics stores, and department stores saw the most dramatic declines in the number of shopping trips last month vs. a year ago.  Trips to toy stores dropped by 23%, trips to electronics stores were down by 21%, and trips to department stores fell by 17%, Nielsen reported.
Retail channels offering low prices and strong value …

According to Nielsen, trips to U.S. retail outlets decreased by 1.4% in the third quarter of 2008, compared with Q3 2007. 
Declines were especially steep during the last four weeks of the quarter, which saw the collapse of Lehman Brothers, the near-collapse of Merrill Lynch, and the government bailout of AIG.
Traditional mass retailers (excluding supercenters), department stores, and office supply stores saw the most dramatic declines in the number of shopping trips last quarter vs. a year ago.  Trips to mass retailers dropped by 9.1%, trips to department stores were down …

Nielsen is forecasting sales of more than $98 billion for the November-December 2008 holiday retail season.  But amid worsening economic conditions, U.S. consumers are likely to be more cautious than ever with their spending. 
A recent Nielsen survey of 21,000 U.S. households found that 35% plan to spend less this year than they did in 2007.  Just 6% will spend more this year, while 50% say they’ll maintain the same level of spending from 2007.
Lower-income households reported large reductions in their holiday spending — but so did high income households.  In all, 37% …