Retailers ring up an $800B holiday record
Solid Bay State shopping factors into national trend
This year’s holiday season sales rocketed an estimated 4.9 percent to set a new record of $800 billion spent from Nov. 1 through Christmas Eve, according to a report released yesterday.
The increase, boosted by a lateseason rally along with growing consumer confidence and rising employment, was up from 2016’s 3.7 percent growth for the same period, and the largest year-over-year number since 2011’s massive 6.8 percent jump, Mastercard Spending-Pulse reported. The estimate encompasses all payment types, including cash and checks, and excludes automobile sales. Dec. 23 ranked only behind Black Friday as the biggest spending day of the year.
“Overall, this year was a big win for retail,” said Sarah Quinlan, senior vice president of market insights at Mastercard. “The strong U.S. economy was a contributing factor, but we also have to recognize that retailers who tried new strategies to engage holiday shoppers were the beneficiaries of this sales increase.”
Shares of U.S. department store operators got a boost following the record holiday spending report, and the S&P retail index advanced 0.63 percent. JC Penney Co. Inc. shares rose 7.6 percent, Kohl’s Corp. shares gained 5.8 percent, Macy’s Inc. shares were up 5.1 percent, and Nordstrom Inc. saw a 2.8 percent increase.
Most U.S. retail stocks have tumbled this year as they continued to lose sales to online stores, mainly Amazon.com Inc. Traditional players have also been hurt by heavy investments in technology and discounting, made to keep up with online and off-price competition.
The biggest winner of the holiday season is likely to be Amazon once again, however, according to a Reuters/Ipsos opinion poll conducted this month. The online retail giant yesterday said it eclipsed its worldwide holiday sales record this year, with more than 4 million people opting for Amazon Prime trials in one week during the period. Amazon’s Echo Dot and Fire TV Stick with Alexa Voice Remote were Amazon’s Nos. 1 and 2 top-selling products among all categories.
Among all retailers, sales of electronics and appliances increased 7.5 percent for the best growth in 10 years, while jewelry sales grew 5.9 percent primarily due to lastminute buys, and home furnishing and home improvement sales rose 5.1 percent.
The Retailers Association of Massachusetts had forecast a 3.1 percent increase in total holiday sales in Massachusetts, but president Jon Hurst on Sunday said he expects the season will exceed those expectations.
Strong local sales trends appeared to continue yesterday. Traffic at the Northshore Mall in Peabody, Auburn Mall and Solomon Pond Mall in Marlboro was robust throughout the day after Christmas.
“Traffic has been high throughout the day, and our retailers are reporting a higher rate of exchanges than returns,” said Mark Whiting, general manager of the Northshore Mall.
The Auburn and Solomon Pond malls opened at 9 a.m. yesterday, an hour earlier than normal.
“We saw shoppers that were coming out to make returns and spend their gift cards, and also take advantage of many holiday shopping deals that the retailers are offering,” said Justin Feldhouse, area manager of the Auburn and Solomon Pond malls. “The retailers are very happy. And, judging by the full parking lot and the number of shoppers that we saw, we’re hopeful that it was better than previous years.”
Online sales, meanwhile, rose 18.1 percent nationally from Nov. 1 through Christmas Eve, according to Mastercard.
“But that’s probably only 11 or 12 percent of total retail sales . ... The bulk of sales still is very much in stores,” Quinlan said. “There’s growth, don’t get me wrong, but we still love that experience of being in-store.”