2022 Holiday Season Spending Lags Entering Final Stretch, Reports NPD
Ahead of Super Saturday, fourth quarter retail revenue is 6% below 2021 levels
The first two weeks of December did not bring much holiday cheer after a lackluster Black Friday and generally disappointing November results. U.S. discretionary general merchandise sales revenue fell over 2 percentage points over Cyber Week (week ending December 3) and 5% the following week, according to U.S. retailer point-of-sale information collected by The NPD Group. Fourth quarter retail sales revenue through December 10 is 6% below 2021 results, and unit sales are down 10%.
“The traditional feeling of spirited chaos is missing from retail this holiday season, and not in a good way,” said Marshal Cohen, chief retail industry advisor for NPD. “With just weeks to go in the holiday shopping season, momentum and the urgency to shop is still missing, as the consumer’s need to prioritize higher-priced food is impeding discretionary spending.”
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“The traditional feeling of spirited chaos is missing from retail this holiday season, and not in a good way,” said Marshal Cohen, chief retail industry advisor for NPD.”
While discretionary spending continues to exceed pre-pandemic results, the current economic conditions have made it increasingly difficult to meet the elevated spending levels of the past two years. In order for fourth-quarter sales revenue to break even with last year, the final three weeks of 2022 will need to outperform last year by 5%. All eyes are on Super Saturday because it typically ranks as the second highest grossing week of the fourth quarter. In 2021, Super Saturday grew 15% compared to the prior week.
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Ahead of this holiday shopping season, some consumers indicated they had their eyes on late-season activity, with 4% planning to wait until the last minute to even begin their holiday shopping, and 8% identifying the week before Christmas as the time they felt they would get the best deals.
“Retailers and manufacturers should be prepared for the trend of spread-out sales to continue through the end of the season, with an early Super Saturday followed by nearly a full week of shopping days,” Cohen said. “Consumers have become accustomed to the frequent discounts they’ve enjoyed since October, so deeper discounts are now necessary to incentivize spending in these final holiday weeks, particularly among the last-minute shoppers.”
