US NRB November 2022

Sales Dip While Experiences Reign Supreme in US Retail Sales

Original release date: December 15, 2022

The US retail sales are continuing to slow in November (a month with a 7.1% rate of inflation) with All Stores up 6.5% YOY and All stores Less Automotive, Food, Pharmacies also up 6.5% YOY.

There were numerous factors in October that likely impacted the fate of November retail sales in the US. First, there was another round of stimulus cheques of $1,000 distributed by the American government. In addition, the following was taking place in regards to holiday shopping:

  • Promotions, like Black Friday and Cyber Monday, seem to be starting earlier and earlier each year: this year starting at the end of October,
  • Buy Now, Pay Later has seen a dramatic increase this holiday season. The rate of these transactions was up 78% during the week of Thanksgiving compared to the previous week. These sales may not be accounted for in November and may be seen in December (until they are fully paid off),
  • Amazon launched a second Prime Day. Though sales were not quite as high as July’s Prime Day, sales were still an estimated $8 billion over the two days.

The final element affecting November sales is that consumers are continuing to spend on experiences as compared to products. According to Mastercard, spending on air fare is up 16.2% YOY, and 3.2% over 2019. Travel lodging spending is up 41.6% YOY, and 42.4% over 2019. These numbers are not reported in retail sales numbers from the US Census. These increases are reflective of what we have been expecting to see in 2022, as well as what many of the JCWG team have been purchasing as gifts this holiday season!

The most popular gift categories, and those that are often most affected by increased inflation. Department Stores (Excluding Leased Departments), Furniture and Home Furniture Stores and Electronics and Appliance Stores all saw decreases YOY, -2.7%, -3.3% and -5.6% YOY respectively. This is not reflective of the increase in holiday spending that was predicted as early as September by the Mastercard.

Food Services and Drinking Places were up 13.6% YOY, which was partly expected as a result of inflation. However, the rate at which the category increased was much higher than the rate of inflation. November saw multiple large sporting events, most notably the World Cup. Though Americans are not typically the biggest fans of soccer, this event still draws millions of people across the country to their local bars and pubs. This is especially relevant as less people are paying for cable subscriptions than in the past and may not have another easy (or inexpensive) method to watch the games.

With November retail sales decreasing, but experiential sales seeing incredible numbers, what we are watching into the new year is:

  • Who will have kept their customer’s wallet share through the 2022 holidays?
  • What experiences are customers wanting to have online vs. in-store and vice-versa?
  • When will customers be back to purchasing products after a year of nearly uninterrupted travel?
  • How are YOU researching, analyzing and measuring your customer experience?

For support with improving your customer’s shopping experience and maintaining your customer’s interest, reach out to JCWG. Join us next month to see how US retail sales in December will complete the year.


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