In prepared remarks shared with reporters during a digital press conference leading up to Black Friday, NRF president Matthew Shay said, “Consumers have shown they are excited about the holidays and are willing to spend on gifts that lift the spirits of family and friends after such a challenging year. We expect a strong finish to the holiday season, and will continue to work with municipal and state officials to keep retailers open and the economy moving forward at this critical time.”
NRF chief economist Jack Kleinhenz pointed to consumers wanting to splurge after a rough year. “After all they’ve been through, we think there’s going to be a psychological factor that they owe it to themselves and their families to have a better-than-normal holiday. There are risks to the economy if the virus continues to spread, but as long as consumers remain confident and upbeat, they will spend for the holiday season.”
That reasoning aligns with spending seen in restaurants with dine-in guests going for expensive items, with seafood and steak seeing a 17 percent and an 8 percent increase, respectively, according to restaurant software company Upserve. Retailers have seen an increase in sales in recent months, bucking the slowing trend seen in restaurants. That’s thanks in part to online and other non-store sales, which are included in the NRF data.
Nearly a quarter of last year’s NRF sales data came from these non-brick-and-mortar options. This year online and other non-store sales are expected to increase by 20 to 30 percent. Last quarter e-commerce sales were up 36.7 percent compared to the year prior.
This shift is already being felt in the nation’s ports, where congestion has become so severe the Federal Maritime Commission recently launched an investigation into it. Meanwhile, a representative from Georgia-Pacific confirmed to nonprofit news organization Marketplace that sales for cardboard delivery boxes have increased by nearly a third compared to last year.
According to NRF data, retail sales have seen a V-shaped recovery that began its positive return in June, growing both month-over-month and year-over-year since then. This continued into October, where a 10.6 percent increase in year-over-year sales was reported. Kleinhenz believes this may be thanks to consumers eager to begin their holiday shopping.
Many consumers canceled their vacations this year and instead opted to spend the money on other big-money purchases such as new appliances. Now consumers look to be using that money saved up from staying home on holiday purchases.
COVID-19 fears have meant the traditional Black Friday sales and their corresponding massive crowds are being replaced this year with sales launched in the weeks ahead of Thanksgiving. In late September, the NRF launched a campaign to encourage early and safe holiday shopping. The “New Holiday Traditions” encourages shoppers to avoid crowds, specifically those found on Black Friday. The initiative seems to be working – 42 percent of consumers began their holiday shopping earlier than usual this year, and a whopping 59 percent report they had started their holiday shopping by early November. Black Friday turnout was down markedly across the nation this year. Many stores limited their hours, offered same or similar deals online, and heavily promoted curbside pickup options.
“Consumers have welcomed the longer shopping season, where many retailers have chosen to offer deals before and leading up to the traditional Thanksgiving and Black Friday doorbusters,” Prosper EVP of strategy Phil Rist said. “These additional offerings translate to more options for holiday shoppers in the long run.”
With massive COVID-19 surges – even larger than ones the nation is already facing – expected to hit in the coming weeks, buying early and online may prove to be the best choice this holiday season no matter how long your shopping list.
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