black friday sales Show that US consumers are keeping an eye on their wallets and expecting more discounts, which is preparing retailers for the holiday shopping season and potentially weak earnings results early next year. Have been.
Consumers are not spending at the same pace they have during the past few years due to the holidays leading to post-pandemic extravagance. While estimates on Black Friday sales won’t be available for some time, Salesforce Inc. expects online U.S. sales in November and December to grow 1% from a year earlier, which would be the slowest growth in at least five years. The software company said sales on Thanksgiving Day were in line with that figure and saw a spike on Black Friday.
Some shoppers said they weren’t impressed by the discounts on Friday — and likely they would if retailers offered better sales. At Willowbrook Mall in Wayne, New Jersey, Alyssa Fennelly said she came up empty-handed while shopping for wedding shoes at Macy’s. The brand he likes was offering 25% discount. “This is not a Black Friday deal,” Fanelli said, “just a regular sale price.”
That’s partly because retailers have recently done a better job of reducing their excess inventory. “Inventory is in line this year,” Jessica Ramirez, analyst at Jane Hawley & Associates, said in an interview. “There’s not as much pressure to move inventory as last year.”
Other data companies are predicting a similarly sluggish holiday shopping season. Adobe Analytics expects online revenue growth in the US during the next two months to be 4.8% from a year ago. Although this is a faster pace than last year, it is still well below the average annual growth rate of 13% before the pandemic. Meanwhile, Mastercard expects US retail sales online and in stores to grow 3.7% this year compared to last year. It is back to pre-pandemic growth pace.
Consumers are “very price conscious now,” Vivek Pandya, principal analyst at Adobe Digital Insights, said in an interview. Preliminary data from Adobe showed that online sales on Black Friday increased by 7.4% compared to last year, mainly due to deep discounts on products such as toys, apparel and computers. Those figures have not been adjusted for inflation.
Adobe, Salesforce, and MasterCard track transactions differently, so the pace of growth varies, even if the general trajectory of their forecasts is the same. Most of the data tracks online sales, which is offset by the difficulty of tracking in-store sales in real time, as well as the continued growth of e-commerce and the doorbuster sales of past Black Fridays.
Still, many shoppers turned out Friday to celebrate the unofficial start of the holiday shopping season. At Westfield UTC, a high-end mall in San Diego, the parking lot was full by 11 a.m. local time. Stores including Gap, Abercrombie & Fitch, Sephora and Lululemon were filled with shoppers purchasing products including children’s pajamas, skin-care gift sets and colorful leggings. At New York’s Hudson Yards shopping center, any store with a SALE sign in front of you was drawing a crowd. Uniqlo, Zara and H&M were bustling with signs offering 30%, 40% and 50% off.
consumer trade-off
Personal savings are depleting due to the pandemic being at an all-time high and while the inflation rate is declining, many items remain more expensive than a few years ago. Higher interest rates are also driving up the prices of home and car purchases. This is forcing consumers to compromise.
Last year, Lindsay and Tyler Manasa spent up to $1,000 on gifts for their family. This year, they are saving for a baby due in January. “No Christmas gifts this year,” Tyler said while shopping for new home essentials at a Target in Chicago’s Logan Square neighborhood.
Still, Michelle Meyer, U.S. chief economist at the MasterCard Economics Institute, believes there is some return of consumers to a more normal pace of shopping after the tumultuous shopping experiences of recent years. This year’s sales forecast points to “a return to a more balanced economy,” he said in an interview. Unemployment remains low, he said. “Consumers have the power to spend.”
In the immediate aftermath of COVID-19, consumers who missed additional savings and stimulus payments splurged, allowing retailers to cut discounts. Then supply-chain chaos struck, which meant merchandise that didn’t arrive in time for the 2021 shopping season was being stockpiled in late 2022. Retailers offered deep discounts to clear out those items, which helped. Sales.
However, last year’s deep discounting has led some shoppers to expect even better sales this year. Mark Talty visited the American Dream megamall in New Jersey on Friday in hopes of purchasing a jacket from The North Face. “I don’t see those great sales they talk about,” he said, adding that he plans to spend about the same amount on holiday gifts this year as he did in 2022.
‘not realistic’
Melissa Minkow, director of retail strategy at digital consultancy CI&T, said she’s seen similar complaints from shoppers on social media. “There were expectations that the waivers were going to be very, very deep,” he said in an interview. “It’s just not realistic.”
She said she’s seen huge discounts, noting that Madewell is offering 50% off everything and Aloe Yoga is offering 30% off. “People have become so cost-conscious now that they’re really looking to relax anywhere,” Minkow said. But retailers still need to protect their profits. According to Salesforce, the average discount rate so far this holiday season is about 30%, which is higher than 2019 and well above the 24% rate in 2021.
Sales are likely to improve in the coming days – at least from the buyers’ perspective.
According to Adobe, shoppers who want to purchase toys and apparel should wait until Sunday for the deep discounts. And for electronics and furniture, it’s best to wait until Monday. Retailers often cut their prices as the holiday shopping season approaches in order to increase sales or to ensure that they sell excess merchandise they have. This may affect the profits of companies selling that type of goods.
By contrast, companies that are expected to do well this holiday season include TJ Maxx owner TJX Co. and off-price retailers like Ross Stores Inc., which have good prices and wide assortments, and in- Demand includes companies selling fitness and outdoor-gear. Items that tap into the wellness trend, Ramirez said. Nike Inc., Hoka owner Deckers Outdoor Corp., ON Running parent ON Holding AG, The North Face Inc. and Lululemon Athletica Inc. are poised to profit, he said.
Consumers are not spending at the same pace they have during the past few years due to the holidays leading to post-pandemic extravagance. While estimates on Black Friday sales won’t be available for some time, Salesforce Inc. expects online U.S. sales in November and December to grow 1% from a year earlier, which would be the slowest growth in at least five years. The software company said sales on Thanksgiving Day were in line with that figure and saw a spike on Black Friday.
Some shoppers said they weren’t impressed by the discounts on Friday — and likely they would if retailers offered better sales. At Willowbrook Mall in Wayne, New Jersey, Alyssa Fennelly said she came up empty-handed while shopping for wedding shoes at Macy’s. The brand he likes was offering 25% discount. “This is not a Black Friday deal,” Fanelli said, “just a regular sale price.”
That’s partly because retailers have recently done a better job of reducing their excess inventory. “Inventory is in line this year,” Jessica Ramirez, analyst at Jane Hawley & Associates, said in an interview. “There’s not as much pressure to move inventory as last year.”
Other data companies are predicting a similarly sluggish holiday shopping season. Adobe Analytics expects online revenue growth in the US during the next two months to be 4.8% from a year ago. Although this is a faster pace than last year, it is still well below the average annual growth rate of 13% before the pandemic. Meanwhile, Mastercard expects US retail sales online and in stores to grow 3.7% this year compared to last year. It is back to pre-pandemic growth pace.
Consumers are “very price conscious now,” Vivek Pandya, principal analyst at Adobe Digital Insights, said in an interview. Preliminary data from Adobe showed that online sales on Black Friday increased by 7.4% compared to last year, mainly due to deep discounts on products such as toys, apparel and computers. Those figures have not been adjusted for inflation.
Adobe, Salesforce, and MasterCard track transactions differently, so the pace of growth varies, even if the general trajectory of their forecasts is the same. Most of the data tracks online sales, which is offset by the difficulty of tracking in-store sales in real time, as well as the continued growth of e-commerce and the doorbuster sales of past Black Fridays.
Still, many shoppers turned out Friday to celebrate the unofficial start of the holiday shopping season. At Westfield UTC, a high-end mall in San Diego, the parking lot was full by 11 a.m. local time. Stores including Gap, Abercrombie & Fitch, Sephora and Lululemon were filled with shoppers purchasing products including children’s pajamas, skin-care gift sets and colorful leggings. At New York’s Hudson Yards shopping center, any store with a SALE sign in front of you was drawing a crowd. Uniqlo, Zara and H&M were bustling with signs offering 30%, 40% and 50% off.
consumer trade-off
Personal savings are depleting due to the pandemic being at an all-time high and while the inflation rate is declining, many items remain more expensive than a few years ago. Higher interest rates are also driving up the prices of home and car purchases. This is forcing consumers to compromise.
Last year, Lindsay and Tyler Manasa spent up to $1,000 on gifts for their family. This year, they are saving for a baby due in January. “No Christmas gifts this year,” Tyler said while shopping for new home essentials at a Target in Chicago’s Logan Square neighborhood.
Still, Michelle Meyer, U.S. chief economist at the MasterCard Economics Institute, believes there is some return of consumers to a more normal pace of shopping after the tumultuous shopping experiences of recent years. This year’s sales forecast points to “a return to a more balanced economy,” he said in an interview. Unemployment remains low, he said. “Consumers have the power to spend.”
In the immediate aftermath of COVID-19, consumers who missed additional savings and stimulus payments splurged, allowing retailers to cut discounts. Then supply-chain chaos struck, which meant merchandise that didn’t arrive in time for the 2021 shopping season was being stockpiled in late 2022. Retailers offered deep discounts to clear out those items, which helped. Sales.
However, last year’s deep discounting has led some shoppers to expect even better sales this year. Mark Talty visited the American Dream megamall in New Jersey on Friday in hopes of purchasing a jacket from The North Face. “I don’t see those great sales they talk about,” he said, adding that he plans to spend about the same amount on holiday gifts this year as he did in 2022.
‘not realistic’
Melissa Minkow, director of retail strategy at digital consultancy CI&T, said she’s seen similar complaints from shoppers on social media. “There were expectations that the waivers were going to be very, very deep,” he said in an interview. “It’s just not realistic.”
She said she’s seen huge discounts, noting that Madewell is offering 50% off everything and Aloe Yoga is offering 30% off. “People have become so cost-conscious now that they’re really looking to relax anywhere,” Minkow said. But retailers still need to protect their profits. According to Salesforce, the average discount rate so far this holiday season is about 30%, which is higher than 2019 and well above the 24% rate in 2021.
Sales are likely to improve in the coming days – at least from the buyers’ perspective.
According to Adobe, shoppers who want to purchase toys and apparel should wait until Sunday for the deep discounts. And for electronics and furniture, it’s best to wait until Monday. Retailers often cut their prices as the holiday shopping season approaches in order to increase sales or to ensure that they sell excess merchandise they have. This may affect the profits of companies selling that type of goods.
By contrast, companies that are expected to do well this holiday season include TJ Maxx owner TJX Co. and off-price retailers like Ross Stores Inc., which have good prices and wide assortments, and in- Demand includes companies selling fitness and outdoor-gear. Items that tap into the wellness trend, Ramirez said. Nike Inc., Hoka owner Deckers Outdoor Corp., ON Running parent ON Holding AG, The North Face Inc. and Lululemon Athletica Inc. are poised to profit, he said.
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