It seems that US shoppers were not going to be deterred in their holiday spending this year. Not by Wall Street’s ups and downs, neither a threat to a government shut-down nor the concerns by economist over slow global growth could keep consumers from spending more than $850 billion this year. When comparing it to last year, that’s about a 5 percent increase!
And according to MasterCard, it was the best retail season in 6 years!
Apparently, retailers hit it right between planning what they would have in-stock in their stores and what they would offer online for people to purchase.
“From shopping aisles to online carts, consumer confidence translated into holiday cheer for retail,” Steve Sadove, a MasterCard senior advisor, said in a statement. “By combining the right inventory with the right mix of online versus in-store, many retailers were able to give consumers what they wanted via the right shopping channels.”
Here’s somewhat of a breakdown according to Master Card of this year’s increase in consumer spending compared to 2017 and the areas consumers spent the most on:
Apparel increased by 8 percent
Home Improvement by 9 percent
Online shopping by 19 percent
Not surprisingly, Amazon came out on top of consumer’s online spending. According to Edison Trends data, the e-commerce giant topped the online market by 81 percent in sales from Dec. 1 through Dec. 19.
Perhaps the biggest reason for this is Amazon’s offering of free shipping through its Prime service which turned out to be 1 billion items shipped for free in the US. It announced on Wednesday that it had a record-breaking season of sales this year! I for one took advantage of their Prime service and passed up on the hassle of in-store shopping.
However, in the midst of all this joyous increase in this years holiday season of sales, not everyone reported a positive seasonal outcome.
MasterCard reported that department stores’ holiday sales took a dip of 1.3 percent compared to last year. Interestingly enough, they saw a 0.7 percent slide in sales in of all areas — electronics — as well as in their appliances.
As great as this year’s holiday seasonal sales have been for retailers, analysts are wondering if they will be able to carry this success over into the next year? Will concerns over what may seem like a slowing down of our economy as well as the possibility of tariffs causing a rise in costs have a detrimental effect on consumer spending in 2019?