Holiday sales up 6.8%, according to Customer Growth Partners
The holiday selling season finished strong, online and in-store.
That’s according to Customer Growth Partners, which said that total sales for the November-December period rose a “remarkable” 6.8% to a record $756 billion. The CGP estimate is more than double that of preliminary results from Mastercard SpendingPulse, which found that total retail sales rose 2.4% from November 1 through December 24.
“Despite a ‘gray’ Black Friday, a shadow of its former preeminence, and fears of spending softness due to Federal aid delays, shoppers defied the COVID headwinds to generate a most-unlikely jump in holiday sales,” said CGP president Craig Johnson. “Digital certainly drove almost 70% of the increase, but big-box stores such as Costco, Dick’s Sporting Goods, Home Depot and Target saw flattish footfall growth converted into robust net traffic growth, along with rising average tickets as shoppers consolidated trips while still boosting their online sales by 40% to 80%. “
Home and hardlines categories — notably electronics, home improvement, sporting goods and the like — thrived as consumer spending continued to rotate from apparel towards the home and work-from-home lifestyles, Johnson noted.
Key highlights of CGP’s analysis as holiday shopping wraps up are below.
• Despite demand “pull-forward” into November —if not October —the combined Nov.-Dec. period generated record sales in both months, with $361 billion in November and $395 billion in December.
• The hardlines winners were electronics, appliances, furniture, outdoor living, sports gear, home improvement.
• Lagging categories include apparel and accessories stores — except footwear — and department stores.
• Conversion rates (the percentage of customers entering a store that buy something) rose by three to six points, mitigating much of the impacts of often sluggish raw traffic (footfall).
• Apparel store promotions are similar to 2019, pressuring margins, while hardlines are mostly selling at full price.
“Looking to 2021, the key question is how sustainable holiday’s robust growth will be in the new year and, given the remarkably sound consumer fundamentals—and the uncertain impacts of COVID before the vaccines are widely available, particularly on employment growth,” Johnson said. “If employment growth lags, retail sales growth may ease to about 3.5%; but if employment accelerates, we may well see solid 4.5% to 5% year-over-year growth again.”