Post-Christmas bounty: $60 billion

Retailers are expected to bag $60 billion in sales in the next week.

NEW YORK (CNNMoney.com) -- Retailers shouldn't write off the 2007 holiday shopping season just yet. Consumers are set to bag $60 billion worth of merchandise over the next seven days, experts say.

Much of that spending - nearly half, according to one estimate - is expected to come when consumers cash in gift cards.

Michael McNamara, vice president of research and analysis for MasterCard Advisors, expects that retailers will ring up as much as 17 percent of their December sales in the last week of the month.

That translates to about $60 billion in holiday-related purchases or roughly 12.6 percent of $474.5 billion that the National Retail Federation expects consumers will spend on holiday-related shopping.

"Over the last five years, the post-Christmas week has become much more important because of gift card redemptions," said McNamara.

MasterCard Advisors did not break out how much of the $60 billion will be spent using gift cards. A survey conducted by the retail federation in November estimated that gift card-related sales this holiday season could reach $26.3 billion.

Marshal Cohen, chief retail analyst with NPD Group, estimates that more than 60 percent of holiday shoppers bought gift cards.

Gift cards are especially critical this year because the retail federation expects holiday sales in November and December to grow 4 percent over last year - or their slowest pace of growth since 2002.

Some early tallies this week from ShopperTrak and MasterCard Advisors said final holiday sales came in short of the retail federation's forecast at 3.6 percent growth. The weaker-than-expected results rattled investors Wednesday, leading to a broad-based selloff in retail stocks.

But stores could make up for some of the shortfall this week.

The International Council of Shopping Centers, citing results of its survey of 1,018 consumers this month, said that one-in-five consumers planned to go shopping the day after Christmas.

"Gift cards have transformed the holiday-shopping landscape and they have extended holiday shopping well past Christmas Day," said Michael Niemira, ICSC chief economist .

"December 26 begins that new phase of the holiday shopping season," he said.

Since merchants only log gift card sales when the cards are actually redeemed, not when they are sold, several chains initiated post-holiday clearance sales on Wednesday to entice gift card holders back in their stores or on their Web sites.

Wal-Mart (WMT, Fortune 500), the world's largest retailer, set clearance sales on clothing, toys, electronics and home and kitchen products. Macy's (M, Fortune 500) slashed prices by 50 to 65 percent this week. At J.C. Penney (JCP, Fortune 500), shoppers are being offered 50 to 70 percent discounts this week.