TOPLINE
Retail sales grew by 7.6% this holiday season compared to the same period last year according to a Monday Mastercard report, as customers took advantage of heavily discounted merchandise amid an overall slowdown in the retail sector over the past few months.
KEY FACTS
Restaurant spending increased the most from November 1 through December 24 compared to 2021, jumping by 15.1% over the previous year according to the report, which excluded automobile purchases.
Online sales grew 10.6% compared to the same period last year to make up 21.6% of total retail sales during the holiday season, an uptick from 20.9% in 2021 and 20.6% in 2020.
Black Friday, or the day after Thanksgiving, remains the biggest shopping day of the year in the U.S. with spending up 12% year-over-year, followed closely by Saturdays in December.
While apparel spending increased by 4.4% compared to 2021, electronics and jewelry both dropped by 5.3% and 5.4%, respectively.
KEY BACKGROUND
The 7.6% increase in spending is a pleasant surprise for the retail industry, with Mastercard in September anticipating only a 7.1% jump. However, the overall increase is less than the 8.5% jump recorded last year between 2021 and 2020, as shoppers appear to be tightening their belts amid high interest rates and fears of an upcoming economic recession. The Commerce Department announced earlier this month November retail sales had fallen by 0.6% from October, marking the biggest decline of 2022.
SURPRISING FACT
Americans will return about 18% of their holiday shopping season purchases, or about $171 billion worth of goods, according to estimates from Appriss Retail and the National Retail Federation. Some 60% of retailers are toughening up return policies this year to help fight off rising costs, according to goTRG, with measures like requiring customers to pay for return shipping and adding restocking fees.
FURTHER READING
Retailers Really, Really Don’t Want Your Holiday Returns This Year(Forbes)
By Carlie Porterfield, Forbes Staff