Dive Brief:
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Retail sales grew 3.3% in the quarter ending Jan. 4, remaining steady year-over-year, according to credit-card payment processing company First Data Corp., which analyzed credit-card payments at 1.3 million retailers.
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Stores saw steady traffic during what in-store analytics company RetailNext’s Ray Hartjen says “has essentially become a five-day holiday shopping event, Thanksgiving through Cyber Monday.” While store traffic fell year-over-year, the decline was smaller than the monthly declines stores had seen in spring, summer, and autumn throughout the year.
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Physical-store traffic was down 6.4% in November and December, and sales were down 2%, according to RetailNext. In December alone, store traffic fell 5.8%, and store sales fell 0.4%. But average transaction value increased 3.6% in December, the third straight month of greater than 3% growth. Sales per shopper were also up 5.7% in December and 4.8% in November and December combined, as shoppers went to brick-and-mortar stores with what RetailNext calls a “strong intent to buy.”
Dive Insight:
The details, including reports from retailers themselves, are still coming in regarding this past holiday season. But it’s emerging as one of winners and losers—in categories, sales channels, and among retailers themselves.
Consumers even at the holidays were more likely to spend money on experiences like movies or eating out than on products, and apparel (except for the winning athleisure category, according to IHS) was a particular loser.
Two major forces ate at retailers’ margins this season: shoppers’ patience for discounts and their penchant for shopping online, which, thanks to fulfillment costs, means thinner margins for retailers.
“You can’t just look at the mall and say the consumer is weak,” Citi analyst Paul Lejuez told the Wall Street Journal. “Some of those guys are losing share. The consumer is spending, but the question is what are they spending on? They want newness, and they are finding it in technology and experiences. They are going to see 'Star Wars' and going out to eat.”
The picture is unlikely to be frozen as simply a snapshot of the holidays, with these issues remaining throughout the coming year.
