Holiday Spending Trends: How Private Retailers are Capitalizing on Consumer Behavior

Holiday Spending Trends: How Private Retailers are Capitalizing on Consumer Behavior Companies are working hard to bolster consumer spending with flashy holiday campaigns that hail back to consumer faves and raise awareness of newer brands

As we enter the holiday shopping season for 2024, consumer focused companies are in a unique spot. Consumer spending has been under pressure due to rising inflation and many consumer-focused businesses have had difficulty over the past few years. Buyers of consumer companies have become more discerning too - opting to do fewer deals in the space. But the tide could be turning. According to PrivCo data, valuations for luxury consumer companies have remained relatively stable and the fourth quarter is typically a time when revenues pick up. Price inflation is starting to come down and M&A is picking up. If the Federal Reserve makes good on its plan to do another interest rate cut before the end of the year, the balance sheets of consumer companies could get a boost.

Consumer spending is also on the rise. Mastercard reported better than expected third quarter earnings with its payment network generating an 11% increase over the prior quarter, according to earnings data. Overall profits for the payment processor and card issuer increased 2% over the same period. These data indicate that consumers are back and willing to spend.

Luxury retailers are working hard to capture the uptick in consumer spending and it’s showing up in their holiday strategies. A number of brands have new creative directors at the helm and others are reviving customer favorite products in an effort to bring back shoppers. If this season proves successful and revenues rise, valuations of consumer companies could rebound which would likely be positive for M&A.

For those looking to understand these shifting dynamics, PrivCo's exclusive holiday season dataset provides detailed insights into the performance and strategies of 10 leading private retailers. This proprietary data, unavailable anywhere else, offers a behind-the-scenes look at revenue trends, valuations, and growth strategies. [Download it now to stay ahead.]

Tom Ford Luxury brand Tom Ford, which recently brought on Haider Ackermann as creative director, launched its winter campaign from Shanghai. The focus is on looks that can transition from day to night and have a variety of accessories with them including sunglasses and bags. The collection also has a jewelry line which focuses on interlocking gold chains. These smaller accessories often provide consumers with lower entry points into the brand. The day to night collection is available in select boutiques and online.

Tom Ford will likely be looking to Ackermann to help get the brand out of a slump. Ackermann is replacing Peter Hawking who led the brand as creative director for just two seasons. Those seasons coincided with a consumer pullback that hit a number of luxury brands including Tom Ford. Ackermann's tenure will just be getting underway with the start of the holiday season, but if it's successful it could be a big lift to the brand.

According to PrivCo data, the company is valued at approximately $3 billion. The Zegna Group, Tom Ford's parent company, expects to grow the brand by 10% CAGR and is considering opening new stores in more markets.

J. Crew J. Crew is returning to its roots for the holiday season. The brand is releasing a 48-piece holiday collection that focuses largely on party wear. The collection is designed by Christopher John Rodgers and features a number of metallics and bright colors reminiscent of vintage J. Crew before the brand shifted to primarily neutrals.

The brand also re-launched its highly coveted catalog. The magazine-like fall/winter catalog gives shoppers all the details on its winter collections without having to go online. The launch issue was published in concert with Atelier Franck Durand, a Paris-based luxury publisher. All of the photos are shot on film and the brand has included exclusive interviews with celebrities. Demi Moore is featured in this issue. Olympia Gayot, who joined J.Crew as creative director in late 2020 frequently returns to the J. Crew archives for style inspiration and those notes are all throughout the catalog. The shift to this format also indicates a change in consumer trends. Shoppers are looking for authenticity and unique experiences. Influencers have recently focused on the power of nostalgia and the re-release of the catalogue suggests that J. Crew sees buying power in that trend.

J. Crew generated $2.6 billion in revenue in 2023, according to PrivCo data. Private equity firms TPD and Leonard Green & Partners both have stakes in the firm. Both firms have made multiple investments in the brand over the past decade.

Tory Burch Similar to J. Crew, Tory Burch launched a sweeping holiday gift guide with a jet set theme. The holiday collection includes a variety of metallics and bold colors that reference the most popular trends from earlier times in the brand's history. As with Tom Ford, the collection is designed to get the wearer from day to night in festive style. Tory Burch also relied on the jet set theme doing most of the photography and styling for the collection in Lake Como, Italy.

Analysts are watching the company closely. 2023 revenues were nearly $2 billion according to PrivCo data, the highest year on record for the brand after consumers returned following Tory Burch's decision to step down from the CEO role to focus on designing. The holiday season is often where fashion brands make most of their revenue for the year so this year's glitzy campaign could determine whether the company beats or maintains last year's high watermark. Private equity firms General Atlantic and BDT Capital Partners are both investors in the brand and will likely be looking to this quarter to see how much growth is left in the investment.

Primark The British retailer is well known in the UK and EU, but doesn't have the same brand recognition in the US where it is still setting up stores and trying to attract shoppers who may not be familiar with what the store has to offer. Primark has a goal of opening 60 US locations over the next several years and will likely need financing to do that.This year could have a significant impact on how financial sponsors value the company and determine its growth potential.

The store's holiday campaign is running inside of a bigger marketing push to raise the store's brand recognition with the tagline "That's so Primark." The campaign is designed to show the full scope of what the store can offer and the holiday collection is no different. It extends from very casual to fashionable, festive party pieces. This holiday season will be a first of sorts for the brand so it's clear that they're trying to get consumers to think of Primark for as many different types of gifts and goods as possible.

Primark's revenue grew 6% to $9.45 billion pounds for the fiscal year ending September 30, 2024. That was a slight decrease compared to the year prior when revenues grew by 17% to $11 billion pounds, according to PrivCo data. Given that the brand's fiscal year starts with the beginning of the holiday season their fiscal first quarter of 2025 should hold some indication of whether or not the campaign was a success. This will be the first year the company goes up against other “everything stores” like Target or Kohls.

PrivCo data suggests that this quarter could shape the trajectory of M&A in the consumer sector throughout 2025 and beyond. The fourth quarter is often make or break for brands that are already under pressure. For companies that are doing well, a slow fourth quarter can raise questions about brand direction and changes in consumer sentiment. With so many new faces driving initiatives at luxury retailers this season, it’s clear that these companies are placing new bets on future growth.

The What’s Next report on consumer companies provides additional insights on revenue and valuations in the sector. PrivCo analysts have gathered millions of unstructured data points on trends like these. We verify the data through a multi-layered, real-time verification process using Artificial Intelligence (A.I.), and highly skilled data scientists. The result is an easy-to-read curated company profile that includes financials, funding rounds, growth signals, and actionable insights. Ready to dive deeper into private retail performance this holiday season? Download our exclusive analysis featuring 10 leading private retailers, with proprietary PrivCo data that isn't available anywhere else. Unlock comprehensive insights on revenue trends, valuations, and growth metrics to understand how these companies are really performing behind their holiday strategies.