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Retail Industry Encouraged by Holiday Sales Gains

Posted By Administration, Thursday, January 15, 2015
Updated: Wednesday, January 14, 2015


In some ways, the deck seemed to be stacked against the retail industry as a late Thanksgiving holiday created a shorter shopping window between the long holiday weekend and Christmas, and Black Friday sales led many prognosticators to negatively adjust forecasts. Clearly, these predictions of doom and gloom were premature.

Overall, retailers enjoyed a strong holiday season as spending exceeded the forecasts of most experts. Several key factors contributed to the lift in sales, including increased consumer confidence, a drop in gas prices, and a higher number of sales over the course of a longer shopping season.

According to FirstData, retail sales increased 3.2 percent between November 1 and January 4, compared to a modest 0.5 percent gain during the same period in 2013. A growth in sales was experienced in all 50 states. ShopperTrak found that holiday sales in November and December 2014 rose 4.6 percent from 2013, the biggest year-over-year gain since 2005.

Interestingly, FirstData reports that Black Friday did not rank among the 10 best days for sales or total number of purchases. Although consumers showed a willingness to shop earlier, last minute shoppers led the way, as the top three days for retail sales were December 22, 23, and 24. The top three days for retail transactions were December 21, 22, and 24.

Rather than focusing on specific shopping days on Thanksgiving weekend, many retailers responded to the demands of the end consumer by offering sales earlier and for a longer period of time. This led to steadier shopping over a two-month stretch rather than overreliance on a handful of days. It also helped to avoid shipping issues that occurred last year.

However, the trend of spreading out sales didn't necessarily apply to Cyber Monday. According to comScore, Cyber Monday was the busiest day of the online shopping day of the season with $2 billion in total sales. The day after Cyber Monday brought another $1.79 billion.

Although in-store sales and foot traffic were down, comScore reports a total of $53.3 billion in e-commerce sales on desktop computers during November and December, an increase of more than 14 percent from 2013. The impact of mobile purchases may push that figure as high as 17 percent, according to Internet Retailer.

Separate research from Tangent Data Services shows an 18 percent increase in online sales, with a seven percent increase in unique online shoppers and an 11 percent increase in the average online receipt.

Sales even continued on Christmas Day as consumers purchased music, applications and other products for their new smartphones and tablets. Christmas Day online sales rose 8.3 percent compared to the previous year, according to IBM.

Retailers also saw positive results from more widespread usage of mobile messaging. MarketingLand research revealed that retailers sent 34 percent more push notifications during the "Cyber Week" shopping period in November compared to 2013. Consumer engagement rates doubled and more than one-third of all mobile retail app "opens" were tied to a push notification. Previous research found that retail leads all industry verticals in engagement and retention improvements resulting from mobile push messaging.

The National Retail Federation predicts a 4.1 percent increase in total sales, which includes both store and online sales.

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Tags:  Holiday 2014 

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