Holiday Retail Spending Higher Than Expected
Despite concerns about inflation and an economic slowdown, holiday retail spending was higher than expected, with online sales leading the charge. U.S. retail sales during the 2023 holiday season grew 3.1% year-over-year, according to Mastercard SpendingPulse. This was higher than the expected growth of 2.5% and suggests that consumers were still willing to spend during the holidays.
"The holiday season was a mixed bag for retailers," said Steve Sadove, Mastercard's chief executive officer. "On the one hand, we saw strong growth in online sales, which were up 11.4% year-over-year. This shows that consumers are increasingly comfortable shopping online, even for big-ticket items."
But with in-store sales up slightly 1.5% year-over-year, consumers were more cautious about spending in physical stores. "Consumers were more deliberate in their spending this holiday season," said Sadove. "They were looking for promotions and deals, and they were less likely to make impulse purchases."
Some of the sectors that performed well during the holiday season include:
- Apparel: Apparel sales were up 4.8% year-over-year. This was likely due to the fact that many consumers were looking for new clothes to wear for holiday parties and gatherings.
- Restaurants: Restaurant sales were up 5.5% year-over-year. This suggests that consumers were still willing to spend on dining out, even during the holidays.
- Groceries: Grocery sales were up 2.5% year-over-year. This is likely due to the fact that consumers were stocking up on food for holiday meals.
Overall, the 2023 holiday season was a positive one for U.S. retailers. Online sales continued to grow at a strong pace, and even in-store sales managed to increase slightly. It suggests that consumers are still willing to spend, even in the face of economic uncertainty.
Looking Ahead to 2024
As retailers gear up for the 2024 holiday season, they should keep in mind the trends that emerged in 2023. Online shopping is here to stay, and retailers need to make sure they have a strong online presence. Additionally, consumers are becoming more value-conscious, so retailers need to offer competitive prices and promotions.
IntelliReach Social can help retailers reach their target audience and increase sales with a positive return on investment (ROI). Our managed local services uses SEO and social media marketing to connect retailers with potential customers and deliver them to their website or store. Call (800) 725-7950 to book an online demo.