CHICAGO – October 6, 2008 - Throughout 2008, the American shopper has endured record high gasoline prices, hurricanes and flooding, and a stalled housing market in their quest to shop. While the consumer has remained fairly resilient during this time, two very recent events are dramatically impacting mall visits and consumer confidence.

According to ShopperTrak RCT, the world’s leading provider of retail intelligence solutions and services, the upcoming election and recent financial crisis are keeping shoppers at home rather than their favorite malls – a pattern retailers are hoping improves heading into the critical holiday season. But while consumer confidence is shaken, ShopperTrak reports that declining mall traffic during an election year is somewhat expected.

An analysis of enclosed mall shopper traffic patterns during the last three national elections revels that shopping activity tends to lessen as Election Day approaches and shoppers focus on the election and its results. In 2002 the country was in a recession, and the Dow Jones Industrial Average and the S&P 500 Index were both hovering near record lows during election season. According to ShopperTrak:

• Enclosed mall traffic averaged a 2.8 percent year-over-year decline each week in the month preceding the 2002 election.
• During election week, traffic declined 2.4 percent as compared to 2001.
• In the weeks following the 2002 election, enclosed mall traffic remained in the doldrums, averaging a 3.9 percent year-over-year decrease all the way through the holiday shopping season.

In the 2004 presidential election, as the country was in the midst of an economic recovery, traffic numbers fared slightly better, but still trended down during election week and showed just a moderate increase in the weeks following the election:

• Enclosed mall traffic averaged a 1.5 percent (per week) year-over-year gain in the month preceding the election.
• During election week, traffic declined 2.4 percent as compared to 2003.
• In the weeks following the election and throughout the holiday season, enclosed mall traffic averaged a 0.8 percent (per week) year-over-year increase.

Finally, when looking at our last national election in 2006 – which preceded the rise in energy prices and the uncertainty in the financial markets – enclosed mall traffic fared quite similarly to 2004:

• Enclosed mall traffic averaged a 1.2 percent (per week) year-over-year gain in the month preceding the election.
• During election week, traffic declined 0.7 percent as compared to 2005.
• In the weeks following the election and throughout the holiday season, enclosed mall traffic averaged a 0.4 percent (per week) year-over-year increase.

According to Bill Martin, co-founder of ShopperTrak, the 2008 presidential election season most resembles both the economic conditions and holiday calendar seen in 2002, which could indicate a steady traffic decline this year.

“We anticipate malls and stores will experience a noticeable decline in shopper traffic during the upcoming election season as shoppers focus on both the election and the poor state of the economy,” Mr. Martin said. “In addition, without any positive economic news, we expect declines in traffic throughout the holiday season – an event which drew over 9.66 billion shopper visits to retail stores and malls in the United States last year. So, based on this, even a 1 percent drop in traffic could mean 96.5 million fewer visits to stores and malls in 2008.”

ShopperTrak reports the recent financial meltdown seen over the last few weeks is also dramatically impacting consumer traffic patterns. Highlights include:

• In the month (August 3 – 30) containing the back-to-school shopping season, ShopperTrak’s Retail Traffic Index (SRTI) reported total U.S. shopper traffic to retail stores and malls fell 5.3 percent, the slowest since 2002.
• Once the financial crisis emerged at the beginning of September, retail traffic declined even further. Between August 31 and September 20, SRTI total U.S. traffic fell an estimated 9.2 percent per day. (see charts below)
• After the failure of Washington Mutual, President Bush’s address to the nation, the presidential debate and the initial rejection of the TARP bailout, traffic fell by an average of 10.5 percent (September 21 – 29).
• The day the TARP bailout package was rejected by congress (September 29) and the NYSE Dow Jones Industrial Average lost 778 points, consumers again responded negatively as shopper traffic fell 12 percent as compared to the same day in 2007.

Mr. Martin says the already slow traffic experienced during an election year, combined with the recent financial crisis, could cause headaches for retailers as the critical holiday shopping season draws near.

“Retailers will be scrambling to make the holiday shopping season and Q4 as profitable as possible, which could be a challenge with the current state of the economy and consumer confidence,” Mr. Martin said. “Most likely we’ll see early holiday sales and promotions geared toward driving shoppers into various retail locations as early as possible.”

Looking ahead to Q4, ShopperTrak’s SRTI traffic index is anticipating a 5.7 percent year-over-year decrease for the period, and the firm’s National Retail Sales Estimate (NRSE) is predicting a 1.9 percent increase as compared to 2007, which is slightly down from the 2.4 percent rise retailers experienced in 2007 as compared to 2006.

Developed by ShopperTrak, the NRSE provides a nationwide benchmark of retail sales. It is derived from the U.S. Commerce Department's GAFO (general merchandise, apparel, furniture, sporting goods, electronics, hobby, books and other related store sales) statistic, as well as ShopperTrak proprietary industry intelligence on shopper movement and sales statistics.

The ShopperTrak Retail Traffic Index™ measures traffic across five separate retail segments including total U.S. retailing. Available as a database or in newsletter format, SRTI reports national and regional traffic trends in a rolling 16 month trend line.

A privately held entity, ShopperTrak leverages 20 years of retail expertise to be the industry's authority for information and analysis of the movement of shoppers in retail environments. ShopperTrak's cutting-edge shopper tracking products and indices offer retail intelligence solutions that enable companies to better understand retail trends and the impact of store and staff performance on company revenues. With more than 50,000 units installed in the world's best known retail outlets and malls, the company's solutions also provide a proven means for retailers to gauge labor efficiencies, advertising and marketing efforts, store design and remodeling programs, merchandise changes, associate training programs, and other budget-intensive strategic initiatives. For more information visit http://www.shoppertrak.com.

EDITOR'S NOTE: The data contained within this news release is the property of ShopperTrak RCT Corporation and may be reprinted, published or broadcast, provided proper credit is given to the National Retail Sales Estimate (NRSE), the ShopperTrak Retail Traffic Index and ShopperTrak RCT Corporation as the supplier of the information. Please contact Aaron Martin at 312-943-9100 if you have any questions concerning the use of this data.