In the first “normal” holiday shopping season since COVID-19 remade the retail industry, sales for the Black Friday through Cyber Monday period appear healthy.
In-store sales over the Thanksgiving weekend (Thursday, November 24 through Sunday November 27) rose 10.5% year-over-year, while e-commerce sales rose 12.5% year-over-year for the same period, according to Mastercard SpendingPulse. Adobe Analytics reported Cyber Monday sales rose 5.8% year over year. However, none of these figures are adjusted for inflation.
But don’t break out the champagne yet as the season continues.
“Black Friday was busy, but it didn’t have that classic Black Friday feeling. The morning bustle and hunt for hot new items was missing. Malls had moderate traffic, while outlets were overflowing. This was likely a decent start to the back-half of the 2022 holiday shopping season, but it remains to be seen what comprehensive sales results reveal about actual spending,” said Marshal Cohen, chief retail industry advisor at NPD Group.
Prior to the holiday, Cohen noted that performance is being compared to the extreme spending elevation that occurred in 2021, and sales revenue trends that mirror the less impressive peaks of 2020. The lack of new and exciting product offerings, promotion fatigue from endless early promotions, and the rising cost of living are making the hurdles even more daunting.
“It will be challenging for the toy industry to deliver growth during these two weeks. Macro-economic factors working against consumers may move toy purchases to later in the season,” said Juli Lennett, NPD toys industry advisor. “There is anticipation of stronger and deeper promotions compared to last year, and a stronger shift from online to in-store shopping (where average selling prices are lower). Self-gifting adults, who drove growth last year, will be the deciding factor behind the toy industry’s up or down performance.”
Top sellers should include the usual classics: Barbie Dreamhouse, Hot Wheels, Star Wars, Uno, Jenga and Monopoly. Appealing to the over 12 set will be Pokémon, Squishmallows, LEGO and sports trading cards, while younger children are asking for items from Fisher-Price and Melissa & Doug. Also expected to sell well are movie-related merchandise, especially from the Marvel Universe and Jurassic World.
Home and beauty goods sales, on the other hand, may be slower, as shoppers have been stocking up earlier, and fragrance, especially, tends to be a last-minute gift.
“Black Friday and Cyber Monday will be less important for the Home Industry than last year because the holiday shopping season started earlier this year,” said Joe Derochowski, home and home-improvement industry advisor. “However, sales will be up vs. pre-pandemic levels because our homes will still be the hub for holiday celebrations and entertaining.”
“I remain optimistic about holiday for beauty, even if Black Friday felt like a letdown. Consumers showed up, though later in the day. Stores were well stocked, ready for the official kick-off of the holiday season,” said Larissa Jensen, NPD beauty industry advisor. “And I observed a lot of spending overall, which is a bright sign for beauty – the ultimate little luxury for consumers to indulge in and gift to others.”
Look for strong sales for cooking appliances such as single-serve brewing systems, espresso makers, air fryers and stand mixers, and cleaning appliances such as robotic and stick vacuums.
On the tech side, look for demand for iPhones, as carriers compete for new customers.
“Consumers will still be spending money this holiday, but with so many choices of where to get the same products, timing becomes critical,” added Cohen. “Retailers will have to work harder to captivate the consumer at the right time – when they are ready to spend.”
