Mastercard holiday wrap-up report: Holiday sales up 5.5%, strongest increase in five years
Purchase, N.Y. — A report released Tuesday by MasterCard Advisors said that increased spending in most categories produced a strong holiday season for retailers, with e-commerce and apparel faring the best. Retail sales from Nov. 5 through Dec. 24 rose 5.5% to $584.3 billion over the same period last year, according to MasterCard Advisors’ SpendingPulse. The figures, which exclude auto sales, are ahead of industrywide projections for a 3.3% to 4% rise for the holiday selling season.
“If last year’s holiday story was about gaining some stability, this year’s is about getting back to growth,” said Michael McNamara, VP research and analysis for SpendingPulse.“The 2010 holiday period is categorized by strong year-over-year growth in Apparel and continued strength in eCommerce. We also saw a noticeable return in spending in the larger ticket items, as exemplified by the solid growth in Jewelry, Luxury and even the Furniture category.”
McNamara also noted that the momentum in 2010 holiday season spending appeared to have started as early as the second week of November, producing a month of solid growth and persisting through the traditional early December lull.
“The cold weather across much of the country in December appeared to be a positive for the Apparel sector,” McNamara noted. “While there was some disruptive weather in the Midwest and the West Coast towards the end of the season, the conditions did not seem to negatively impact the national sales momentum. In some cases the weather may have also benefited the e-commerce channel.”
E-commerce was the big winner this year, with seasonal sales up 15.4%, according to the report. Apparel was a strong performing category, growing 11.2% over the 2009 holiday season. Broken down by segment, menswear reached double digit growth weighing in at 10.5% year-over-year. Women’s apparel grew by 5.6%, making for one of the best periods of growth in this subcategory since the financial market turmoil in 2008.
The electronics category was one of the lagging performers, growing 1.2% season-to-season. Jewelry improved during the 2010 season. After a mild start, Jewelry posted several weekly year-over-year increases and ended the season up 8.4%.
The SpendingPulse survey by MasterCard, which reports on national retail and services sales and is based on aggregate sales activity in the MasterCard payments network, coupled with survey-based estimates for all other payment forms, showed that in the Nov. 5 to Dec. 24 period, sales grew 5.5% overall season-over-season (ex-auto).
Blizzard hurts retailers as post-Christmas shoppers stay home
New York City — Sunday’s east coast snowstorm disrupted sales throughout the entire area and disrupted one of the busiest shopping days of the year.
Sections of New York and New Jersey got as much as two feet of snow over the past few days, keeping many shoppers at home. Spending may shift into January, Marshal Cohen, chief industry analyst at Port Washington, N.Y.-based NPD Group, told Bloomberg on Monday.
“Look for sales to be repeated by retailers. They’re going to be more aggressive,” Cohen said.
The day after Christmas is one of the five busiest shopping days of the year, and it may take retailers two weeks to capture sales lost yesterday, Cohen told Bloomberg. At the same time, shoppers may lose their enthusiasm as the holiday season wanes, he said.
For some retailers, however, the storm brought benefits. Home Depot and Lowe’s Cos. sold out of snow blowers and shoppers bought more shovels and ice melt, Craig Johnson, president of New Canaan, Conn.-based Customer Growth Partners, told Bloomberg. The storm also likely will give online sales “a slight bump” on Sunday and Monday, he said.
The Standard & Poor’s 500 Retailing Index dropped 3.16 points, or 0.6%, to 508.67 at 10:39 a.m. EST on Monday. The index had gained 25% this year before Monday, compared with a 13% increase for the S&P 500, according to the Bloomberg report.
Consumers may temper their spending if the storm’s aftermath stalls shopping for several days and the frugality of New Year’s resolutions kicks in, Michael Dart, the San Francisco-based head of private equity at the New York consulting firm Kurt Salmon Associates, told Bloomberg.
New York City had 18 inches to 20 inches of snow by 7:30 a.m. local time Monday as the storm’s center shifted north and east, commercial forecaster AccuWeather said. The National Weather Service issued blizzard warnings for Boston and into Maine.
Online retail sales reach Christmas season record
New York City — A report released Monday by MasterCard Advisors said that while it’s still too early to know the final outcome of the Christmas shopping season, it’s already clear that it’s been a record season for online retail.
Consumers had spent $36.4 billion online by Thursday, the day before Christmas Eve, according to SpendingPulse, a MasterCard Advisors report. That’s a 15.4% increase over last year. Six out of the seven weeks since Oct. 31 marked double-digit rises in online spending, with apparel accounting for 18.8% of overall sales online. In 2009, apparel accounted for 16.9% of spending.
Figures may rise even more with the addition of bricks-and-mortar retail sales, according to the MasterCard Advisors report. Shops and malls were crowded; the National Retail Federation expected a 3.3% jump over last year’s spending, to more than $451.5 billion. The year-over-year increase hasn’t been that hefty since 2006; it would also be the biggest total since the record sales figure in 2007 of $452.8 billion.