Although inflation will help to raise dollar sales, retailers will see less growth in sales volume this holiday season.
That’s according to Deloitte’s annual holiday retail forecast, which predicts that year-over-year holiday sales will increase 4% to 6%. By comparison, sales grew 15.1% during the 2022 holiday timeframe (November 2021 to January 2022).
Overall, Deloitte projects that holiday sales will total $1.45 to $1.47 trillion during the 2022 holiday period. Holiday sales totaled $1.39 trillion last year, according to the U.S. Census Bureau.
Deloitte is also forecasting a 12.8% to 14.3% increase in 2022 holiday e-commerce sales compared with the same period in 2021. E-commerce sales between November 2021 and January 2022 grew 8.4%, and totaled $231 billion.
The lower projected growth for the upcoming holiday season reflects the slowdown in the economy this year, noted Daniel Bachman, Deloitte’s U.S. economic forecaster.
“Retail sales are likely to be further affected by declining demand for durable consumer goods, which had been the centerpiece of pandemic spending,” he said. “However, we anticipate more spending on consumer services, such as restaurants, as the effects of the pandemic continue to wane.
As inflation weighs on consumer demand, we can expect consumers to continue to shift how they spend their holiday budget this upcoming season," added Nick Handrinos, vice chair, Deloitte LLP, and U.S. retail, wholesale and distribution and consumer products leader.
"Retail sales are set to increase as a result of higher prices, and this dynamic has the potential to further drive e-commerce sales as consumers look for online deals to maximize their spending,” he said. “Retailers across channels who remain aligned with consumer demand and offer convenient and affordable options can be well positioned for success this season.”
Deloitte released its forecast the same day that MasterCard Spending Pulse said that U.S. retail sales are expected to increase 7.1% year over year. (All holiday forecasts exclude automotive.)