A shopper searches for footwear items at a Macy’s store during the Black Friday sales on November 25, 2022 in Jersey City, NJ.
Kena Betancourt | Getty Images
A record 196.7 million holiday shoppers returned to stores and hunted for discounts from Thanksgiving to Cyber Monday, according to a National Retail Federation survey that tracks in-store and online purchases.
The trade group did not estimate spending for the weekend but said on Tuesday that sales for the entire holiday shopping season were in line with forecasts. Holiday sales are expected to grow 6% to 8% year-over-year to between $942.6 billion and $960.4 billion. Part of this increase will be due to high inflation that has lasted nearly four decades.
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The National Retail Federation defines the holiday season as November 1st to December 31st. The sales forecast does not include spending at car dealerships, gas stations or restaurants.
Over the weekend, shoppers spent an average of about $325 on holiday-related purchases. This is higher than last year’s average of $301.
NRF CEO Matt Shay said the most important takeaways from the weekend are that Americans are once again willing to shop in person and are hungry for big deals. More than 122.7 million people visited brick-and-mortar stores last weekend, up 17% from 2021.
As inflation hit Americans’ wallets, promotions became an important motivator, he said.
“Consumers shop, but they shop when they see great deals and get promotions that match what they are looking for, so you can get them involved, but you have to provide value and price,” he said in an interview with journalists.
However, retailers are being cautious about their holiday forecasts, especially as families are feeling inflation. walmart talked about customers skipping discretionary foods and buying cheaper proteins like hot dogs and peanut butter. Target cut its forecast for the holiday quarter. As well as Best Buy said customers were more interested in shopping during sales.
So far, however, industry observers have reported a successful start to the buying season. Adobe Analytics data showed that online spending reached an all-time high on key days of the holiday weekend. Black Friday sales reached $9.12 billion and Cyber Monday sales reached $11.3 billion, according to a company that tracks sales on retailer websites.
On average, consumers said in an NRF survey that they were about halfway through holiday shopping. This means retailers can expect more purchases in the coming weeks, Shay said.
On Tuesday, NRF said the number of buyers over the holiday weekend surpassed last year’s turnout of 179 million for the same period last year. The group, which began tracking the metric in 2017, had forecast a turnout for that year of 166.3 million.
The high turnout and record spending this holiday season could be the result of a variety of factors. This may indicate that consumers are willing to buy, but only if the goods are being sold at a significant discount. It could also signal a return to the pre-pandemic holiday shopping schedule, with people concentrating their gift shopping on Black Friday and the final sprint before Christmas.
Or it could portend a more challenging 2023. If Americans fund shopping by cutting savings rates and counting large credit card balances or through Buy Now, Pay Later, this could result in them having less money in the coming months.
The National Retail Federation, a major trade group, took an optimistic stance on consumer spending, saying a strong job market is encouraging Americans to keep spending.
Shay also allayed fears of a recession on Tuesday, but acknowledged another risk for retailers: the threat of a railroad strike. While retailers may have most of their holiday merchandise, he said the shutdown could be a blow to consumer confidence.
“We think the holiday season will be the most inopportune time,” he said.