At least one early survey suggests that shoppers spent less over the Thanksgiving weekend than last year. Retail analysts and economists are sticking to their upbeat predictions, however, that consumers will spend more in the November-to-December period than they have in three years.
Why? Simply put, there's a big difference between what consumers say and what they actually do. The National Retail Federation’s closely watched survey polled about 4,600 customers Friday and Saturday and found that shoppers spent about 11 percent less over the weekend than last year. The survey’s margin of error is 1.5 percentage points.
Even so, NRF is maintaining its forecast that holiday sales will rise 4.1 percent from last year. Consumer spending makes up about 70 percent of U.S. economic activity, and most retailers rely on a surge in sales over the holidays to pad their bottom lines before the new year.
What makes this year’s Black Friday somewhat different? It fell in the middle rather than the end of millions of paycheck periods, and the weekend’s sales are losing their relevance in holiday forecasting as retailers push discounts earlier into November and compete with online sellers, experts say.
This weekend's online sales data from IBM’s digital analytics division showed a 17 percent rise over the same weekend last year. Sales data from brick-and-mortar retailers are forthcoming.
Jesse Tron, spokesman for the International Council of Shopping Centers (ICSC), said the phrases he heard most often this weekend from mall property owners were “sales up slightly,” “on par” and “good crowds,” especially at anchor stores such as Macy’s and J. C. Penney. The Taubman Company, which owns 20 malls nationwide, reported that three-quarters of its retailers’ sales grew slightly or remained on par with last year. Macerich, which owns about 40 malls nationwide, reported similar traffic and sales, Tron said.
“Intention surveys are difficult,” he said. “I’m not expecting it to be as dire as what’s being reported right now. We’ll see what happens when the government data comes out.”
Chris Christopher, director of consumer economics for IHS Global Insight, said he won’t revise his forecast of a 4.2 percent holiday sales increase from last year unless November same-store sales data released by the government Tuesday surprise him.
According to IHS Global Insight’s payroll tracker, 10 million fewer people were paid on Black Friday vs. last year and instead paid the previous Friday and the Friday after.
“Payroll economics plays a big role on how people shop,” Christopher said. “And retailers started discounting pretty strongly before Thanksgiving, so people got shopping out of the way earlier.”
Fewer than one in five Americans said they would shop on Black Friday this year, according to a Gallup survey in mid-November. More than a third who said they planned to shop the day after Thanksgiving were aged 18 to 29, and nearly a third were nonwhite compared to 15 percent of white Americans. By region, those in the Midwest were most likely to say they would shop on Black Friday.
Black Friday is still the busiest day of the year for retailers, surpassing $50 billion according to the NRF’s estimate. But the annual shopping surge is spreading beyond a single day to the week of Thanksgiving and the weekend after. Even the week before Thanksgiving saw an uptick in sales compared with the same week last year, according to ICSC data.
“November to December used to be a much bigger share of the retail calendar,” Tron said. “The season is still important, but retailers have done a better job of managing the entire calendar so there’s a lot of important landmarks throughout the year.”