Despite Decline in Black Friday Spending and Foot Traffic, NRF Remains Bullish
According to its annual Black Friday consumer survey conducted in the middle of the holiday shopping weekend, the National Retail Federation found that 165 million American shoppers went online or in stores to try to take advantage of deep discounts on popular gifts and gadgets. That figure surpassed the 164 million that indicated their intentions to shop prior to the Black Friday weekend, but it fell around 9 million short of last year’s total, the association said, during a call with the media on Tuesday afternoon.
Additionally, NRF reported that the average spend on gifts and other holiday items over the five-day weekend checked in at $313.29, down from last year’s average of $335.47. Despite those declining numbers, the group remains confident that the retail industry is poised for another strong year. In fact, NRF said during the call that it expects its holiday forecast of a sales increase for the November-December time period of between 4.3 percent and 4.8 percent to come in on the high end of that scale.
“For several years, we’ve been talking about the dynamic nature of the retail industry and the speed of change necessary to meet the consumer demand,” NRF President and CEO Matthew Shay said in a statement. “This year’s research clearly shows that the investments made by retailers are paying off in a big way. Over the last couple of days, what I heard in discussions with retail CEOs across all categories and segments was very positive, driven by macro conditions of low unemployment and rising wages combined with the right mix of merchandise at great prices. This is a very strong emotional start to the holiday season and a positive indicator of where we are headed over the next month.”
So, why the decline in performance for this every-crucial five-day period?
The association pointed to a number of key factors, most notably the longer period of time between Christmas Day and Black Friday. This year, with Thanksgiving Day falling so early in the month, consumers have almost an entire extra week to get their holiday shopping done. That fact is reflected in NRF survey data that showed 56 percent of consumers still have more than half of their holiday shopping left to do, even after the Black Friday long weekend. Further, the group said that with a stronger economy and more disposable income available to consumers, there’s no need for them to spend it while they have it during this one weekend. Rather, they can spread out their holiday shopping and hold tight looking for a good deal.
And to that end, NRF’s survey found that an enormous majority of consumers (92 percent) believe that the strong deals they saw over the Black Friday shopping weekend will continue and possibly even improve throughout the rest of the holiday season.
Multichannel Shoppers Spend More
With this survey, NRF shared a great deal of insights into just how much consumers’ shopping habits have changed over the years—and how retailers are working hard to improve their offerings to stay in step with consumers’ expectations. For example, NRF reported that the biggest spenders this year (like last year) was the older millennials and Gen Xers who dropped an average of $413.05. That same cohort helped drive the exponential rise of the multichannel shopping experience. NRF found that roughly 88 percent of consumers between the ages of 18 and 34 used their mobile device to make a purchase decision over the Thanksgiving weekend.
Looked at a different way, just 21 percent of consumers (34.7 million) shopped only in stores over the Black Friday five-day weekend. Of the remaining consumers, 25 percent (41.4 million) shopped online only, and 54 percent (89.7 million) were multichannel shoppers. The latter, multichannel figure represented nearly 40 percent growth on a year-over-year basis.
“This year, Gen Zers and millennials changed the way they shopped over Thanksgiving weekend,” Prosper Executive Vice President of Strategy Phil Rist said in the statement. NRF commissioned the survey, which was conducted by Prosper. “These younger shoppers have become savvier when it comes to their research by leveraging social media to find inspiration for their purchasing decisions and used the holiday weekend to splurge on non-gift purchases for the season.”
The importance extends beyond presence alone thought. NRF found that the multichannel shopper spent an average of $93 more than the single-channel shopper this year.