While online spending surged, the overall picture for Thanksgiving weekend spending was more mixed as the traditional “bricks and mortar” retailers continued to struggle. Nevertheless, overall spending was about 4% higher. The National Retail Foundation (NRF) estimated that 174 million Americans shopped online or in stores over the period (Thursday to Monday), versus 164 million the previous year, although the latter excluded Cyber Monday. According to Bloomberg.
“The big takeaway here is: Gone are the days you could measure the success of this weekend by looking at a single metric,” NRF Chief Executive Officer Matthew Shay said on a conference call.
It’s also difficult to tell from the NRF data how e-commerce sales compared with brick-and-mortar shopping. But other surveys have indicated that physical chains saw smaller crowds this year. The research firm ShopperTrak found that shopper visits declined 1.6 percent combined on Thanksgiving and Black Friday.
Overall spending in the holiday season is expected to rise as much as 4 percent from last year, helped by low unemployment and rising home values. The purchases will amount to about $680 billion in November and December, the Washington-based NRF has estimated.
However, there is no doubt about the strength of the online sector and mobile in particular.
The Thanksgiving shopping season was record-breaking measured by the total level of online spending and the big shift towards mobile to both browse and buy. Adobe, which measures 80% of online transactions from 100 major US retailers, estimated that $5.03 billion was spent on Black Friday, $2.82 billion on “Small Business Saturday” and $6.59 billion on Cyber Monday – the largest ever online sales day in history and 16.8% higher than a year ago. According to Adobe, mobile devices accounted for between 46% and 54% of all site visits, and between 30% and 37% of all sales, on those days, the biggest proportion yet.
In part, as Bloomberg notes, the strength in online and mobile shopping reflects the growing spending power of “older millennials” in the 25-34 age range.
The kickoff to the holiday shopping season brought mixed results to retailers, with traffic falling at many stores. But don’t blame older millennials. Shoppers in that age group, which ranges from 25 to 34, were the biggest spenders during the long Thanksgiving weekend, according to the National Retail Federation. Older millennials shelled out $419.52 during the five-day stretch, 25 percent more than the overall average.
The survey findings reflect the growing clout of millennials in their 20s and 30s, especially as more of them form families and enter prime spending years. Still, their higher profile is a mixed blessing for retailers. Such shoppers are more likely to buy online — often using their phones — meaning brick-and-mortar storefronts won’t see as much of a traffic bump.
The trade group’s survey, conducted by Prosper Insights & Analytics, found that 64.6 million Americans shopped both online and in stores. That compares with 58.4 million who shopped online and 51.6 million on who only went to stores.
In terms of product categories, clothing was the biggest over the holiday weekend followed by toys, books and electronics. Despite the hollowing out of America’s traditional retail sector, the NRF has a positive spin on the industry’s evolution.
“We were very encouraged that what we saw was strong engagement across the board, both in stores an online,” Shay said. “That validates the investment retailers are making to reach customers in multiple ways.”
Since peak spending normally occurs between the years of 45-48 years old, we hope that “older millennials” are not exhausting their buying power prematurely due to their online and mobile addictions.