Despite supply issues and omicron, holiday sales rise 8.5%
Holiday sales rose at the fastest pace in 17 years, even as shoppers grappled with higher prices, product shortages and a raging new COVID-19 variant in the last few weeks of the season, according to one spending measure.
Mastercard SpendingPulse, which tracks all kinds of payments including cash and debit cards, reported Sunday that holiday sales had risen 8.5% from a year earlier. Mastercard SpendingPulse had expected an 8.8% increase.
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The results, which covered Nov. 1 through Dec. 24, were fueled by purchases of clothing and jewelry.
Holiday sales were up 10.7% compared with the pre-pandemic 2019 holiday period.
By category, clothing rose 47%, jewelry 32%, electronics 16%. Online sales were up 11% from a year ago and 61% from 2019. Department stores registered a 21% increase over 2020.
After omicron hit, some consumers stayed home and shifted their spending to e-commerce — but sales stayed strong. “I feel really good about how the season played out,” said Steve Sadove, senior adviser to Mastercard and former CEO of Saks Inc. “When people feel a little bit uncomfortable, you’ll see a little bit of a pickup in online and a little bit of a slowdown in store performance.”
A broader picture will be revealed next month when the National Retail Federation, the nation’s largest retail trade group, comes out with its combined two-month results in mid-January. The results will be based on an analysis of the November and December sales figures from the Commerce Department. Analysts will also be dissecting the fourth-quarter financial results from different retailers that are slated to be released in February.
Overall, analysts had expected a strong holiday season, fueled by early shopping that started back in October in anticipation of a product shortage. Consumers were also determined to celebrate the holidays after a muted one a year ago. Still, November saw a slowdown in retail sales, in part because of the early shopping. And omicron, which has fast become the dominant version of the virus in the United States, has now spoiled holiday plans for many Americans who have had to cancel gatherings last minute.
The National Retail Federation said early in December that holiday sales were on track to beat its already record-breaking forecasts for an increase of 8.5% to 10.5% compared to the year-ago period. Holiday sales increased 8.2% in 2020 when shoppers, locked down during the early part of the pandemic, splurged on pajamas and home goods, mostly online.
