Revised Article:
Holiday Shopping Dip: A Two-Year Trend
Holiday shoppers during Thanksgiving weekend show a decrease for the second consecutive year, as reported by the National Retail Federation.
The number of holiday shoppers—both online and in-stores—took a hit for the second year running, according to a fresh report from the National Retail Federation (NRF) and Prosper Insights & Analytics. The count dropped from 186.4 million last year to 179.8 million this season.
The holiday pixie dust wasn't sprinkled evenly across all gift categories this year either. Clothing and accessories topped the list at 51%, followed closely by toys (32%), gift cards and certificates (28%), entertainment (27%), and electronics (24%).
Despite the dipping numbers, almost half (49%) of survey respondents made some holiday purchases before Thanksgiving, and a whopping 82% believed the deals on offer were just as good, if not better, than last year. Consumers parted ways with an average of $301.27 on holiday buys, a slight decrease from $311.75 last year. The NRF still predicts a growth of between 8.5% and 10.5% in holiday sales from November 1 to December 31 compared to 2020.
The NRF's Annual Report: A Mirror of the Pandemic's Persistent Influence
The NRF's 2021 findings highlight how the COVID-19 pandemic continues to shape the holiday shopping landscape, with retailers striving to disperse purchases and mitigate crowds. In-store traffic during the Thanksgiving weekend of last year had already dipped compared to 2019, and consumer spending took a hit as well that year. In 2020, 186.4 million people shopped the weekend, down from 189.6 million in 2019, though still above 2018 levels.
The NRF's President and CEO, Matthew Shay, attributed the decrease in shoppers and spending to consumers advancing their holiday shopping earlier in the season, a trend that's far from vanished.
"Retailers have adapted and tempted customers with an array of incentives throughout November. The Thanksgiving holiday weekend remains a special time for friends and families to tick specific items off their wish lists," Shay said. "Over the past few years, consumers have been shifting their shopping plans towards earlier in the holiday season."
Although consumers may not have noticed the lackluster discounts available during this year's holiday shopping spree, research suggests that some retailers' deals didn't quite hit the mark compared to last year. A Salesforce report revealed that the average discount was 27%, a 7% decline from 2020. Research from Kearney showed that Nordstrom and Foot Locker weren't as forthcoming with discounts this year, while Macy's, Gap, and Madewell presented shoppers with considerably better offers.
The Cyber Monday results seem a bit conflicted. Adobe Analytics reported a 1.4% decline in sales to $10.7 billion compared to last year, but Mastercard and Salesforce registered improvements for the online shopping extravaganza.
Factors Contributing to the Decline in Shoppers and Spending During the 2021 Thanksgiving Weekend
The reasons behind the decline in holiday shoppers and spending are multifaceted:
- COVID-19 Pandemic: Although the pandemic's intensity eased in 2021 compared to 2020, its impact on consumer behavior lingered. Many opted for online shopping to steer clear of crowds and potential health risks, which thinned out physical store traffic.
- Shift to E-commerce: The ongoing move towards e-commerce, accelerated by the pandemic, also played a part in reducing in-store shopping. More consumers turned to online platforms for convenience and safety[3].
- Supply Chain Disruptions: The year 2021 saw significant supply chain bottlenecks due to shipping delays and stock shortages. This might have hindered consumer spending as some items were either unavailable or delayed[1].
- Inflationary Pressures: Although inflation wasn't as high in 2021 as in subsequent years, it was still a concern. Rising costs for goods and services could have prompted consumers to tighten their purse strings.
A Look Back at Previous Years
- 2020: The 2020 Thanksgiving weekend witnessed a significant drop in brick-and-mortar sales due to the COVID-19 pandemic. Online sales increased, but overall spending was still affected by pandemic restrictions and fears[5].
- Pre-Pandemic Years: In years leading up to the pandemic, the shift towards e-commerce was already in progress, but it wasn't as prominent as during and after the pandemic. The experience economy and modifications in consumer spending habits were also factors impacting retail sales[3].
In conclusion, the decline in holiday shoppers and spending during the 2021 Thanksgiving weekend is tied to the lingering effects of the pandemic, the continued shift to online shopping, and other economic factors.
- The NRF's report suggests that AI, in the form of online shopping platforms, has become an integral part of holiday shopping, with 49% of survey respondents making purchases before Thanksgiving online.
- In response to the increased reliance on e-commerce, the retail industry has had to adapt, offering a variety of incentives to attract customers throughout November.
- According to the report, the health pandemic continues to influence the holiday shopping landscape, with many consumers prioritizing online shopping to minimize exposure to crowds and potential health risks.
- The entertainment industry might have also seen a surge in revenue during the holiday season, as consumers spent 27% of their holiday budgets on entertainment, according to the report.
- Cultural trends towards cybersecurity may have played a role in consumer behavior during the holiday shopping season, as concerns about online safety and security might have influenced purchasing decisions.
- The business of finance continues to be intertwined with holiday shopping, as consumers parted ways with an average of $301.27 on holiday buys, a slight decrease from the previous year.
- Amid the lingering effects of the pandemic, the fashion industry has also had to adapt, with clothing and accessories topping the list of gift categories at 51%, according to the report.
- Policy changes might have impacted the holiday shopping landscape, as consumers advancing their shopping earlier in the season could be a result of industry initiatives or government regulations promoting earlier shopping.
- Although the overall number of holiday shoppers decreased in 2021, there was still growth in holiday sales, with the NRF predicting a growth of between 8.5% and 10.5% in holiday sales from November 1 to December 31 compared to 2020. This growth can be attributed to the increase in online shopping and earlier spending patterns.
