Even with Omicron, sales continue to grow.

on December 27, 2021

Holiday sales rose at the fastest pace in 17 years, even as consumers grappled with higher prices, product shortages and a new variant of COVID-19 in the final weeks of the season, according to a measure. spending.

Mastercard SpendingPulse, which tracks all types of payments, including cash and debit cards, said on Sunday that holiday sales were up 8.5% from a year earlier. Mastercard SpendingPulse had expected an increase of 8.8%.

The results, which covered Nov. 1 to Dec. 24, were driven by clothing and jewelry purchases.

This year's sales are up 10.7% compared to the same pre-pandemic period in 2019.

By category, clothing increased 47%, jewelry 32%, electronics 16%.

Online sales are up 11% from the previous year and 61% from 2019.

Department stores saw a 21% increase over 2020.

After the new omicron variant arrived, some consumers stayed home and shifted their spending to e-commerce — but sales remained strong. “I feel really good about the season going on,'” said Steve Sadove, Senior Consultant at Mastercard and former CEO of Saks Inc. “When people feel a little uncomfortable, you'll see an improvement in the online market and a little of deceleration in store performance. ''

A bigger picture will be revealed next month, when the National Retail Federation, the country's largest retail group, reports its two-month combined results in mid-January. The results will be based on the Commerce Department's analysis of November and December sales figures. Analysts will also dissect fourth quarter financial results from different retailers due in February.

Overall, analysts had expected a strong holiday season, fueled by early purchases that began in October in anticipation of product shortages.

Consumers were also determined to celebrate the holiday season after a quiet season a year ago. Still, November saw a slowdown in retail sales, in part due to the start of shopping. And the new omicron variant, which quickly became the dominant version of the virus in the United States, has now spoiled the vacation plans of many Americans who had to cancel meetings at the last minute.

The National Retail Federation said in early December that year-end sales were on track to beat their already record forecasts of an 8.5% to 10.5% increase compared with the year-earlier period. Year-end sales rose 8.2% in 2020 as customers, locked out during the start of the pandemic, shopped for pajamas and household goods, mostly online.

The group's expectation is that online and other off-store sales, which are included in the total, will increase between 11% and 15%. The numbers exclude car dealerships, gas stations and restaurants. Year-end sales have averaged gains of 4.4% over the past five years, according to the group.

The NRF update was delivered in early December, just before Omicron became a bigger threat in the US and began disrupting businesses from Broadway theaters to restaurants. But overall store traffic has not slowed, although some stores are reporting drops in major city locations. In the week ending December 18, store traffic increased by nearly 20% from a year earlier, although it was down 23% from the same week in the pre-pandemic year of 2019, according to Sensormatic Solutions. Peter McCall, Senior Manager of Retail Consulting at Sensormatic, noted that customers are still going to retail stores, but are now preferring outdoor malls and outlets to indoor malls.

While major retailers like Target and Walmart have promised to stock shelves for the holiday, supply restrictions appear to be in short supply elsewhere. Target CEO Brian Cornell recently told the Associated Press that he believes it will take several years for supply chain clogs to clear.

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This story corrects Mastercard's SpendingPulse forecast from 7.4% to 8.8%.

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AP Economics writer Marty Crutsinger contributed to this report in Washington

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