NEW YORK (CNN/Money) - Retail sales could get a nice pop during the crucial holiday shopping season, with consumers expected to spend more money this year for gifts and decorations, according to the results of a survey released Tuesday.

According to the National Retail Federation's 2003 Holiday Consumer Intentions and Actions Survey -- a joint study done by the NRF and BIGresearch -- the average consumer plans to spend $671.89 this holiday season, up 3.5 percent from 2002.

"Though many consumers are more financially comfortable now than they were a year ago, they are still looking for great prices and savings on gifts and everyday merchandise," said Phil Rist, Vice President of Strategy for BIGresearch. "The retailers that succeed this holiday season will be those that continue to focus on sales and promotions to drive traffic."

In fact, 39 percent of consumers said they base their decision to shop at certain retailers on sales or price discounts, while 22 percent said they choose to shop at retailers with everyday low prices, the survey said.

Discounters remain the popular destination of choice for holiday merchandise for Christmas, Hanukkah, and Kwanzaa, and are expected to see the most traffic, with three-fourths of consumers planning to shop at a Wal-Mart (WMT: Research, Estimates) or Target (TGT: Research, Estimates).

The NRF is forecasting holiday sales to increase 5.7 percent this year to $217.4 billion, which would be the largest increase since 1999.

"With some retailers seeing between 25 and 40 percent of their annual sales during the holiday season, there's still time for retailers to show positive gains in 2003," said NRF President and CEO Tracy Mullin.

Books, CDs, DVDs, videos, or video games are expected to be the popular gifts this year, followed by clothing, gift cards, electronics, jewelry, and home furnishings.

Kurt Barnard, an independent consultant, said the NRF's holiday spending forecast seems muted to him, considering the agency's fairly bullish holiday sales predictions.

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"I expected the spending forecast to be more buoyant. But it could be the case that NRF is curbing their enthusiasm a little now," Barnard added.

He expects holiday sales to rise between 3 and 4 percent, adding " I hope I'm not being too optimistic there. Unemployment is a big factor. With 9 million unemployed people, the jobs picture is expected to be a major drag on holiday spending."