US Retail Sales Surge Over Holiday Season As Retailers Ramp Up Promotions, Says Mastercard

Authored by Katabella Roberts via The Epoch Times,

Retail sales rose by nearly 4 percent year over year across the United States this holiday season as more Americans sought bargains during the November and Black Friday shopping period, according to new data from Mastercard SpendingPulse.

Mastercard analyzed in-store and online retail sales across the country from Nov. 1 to Dec. 24, with the company tracking all payment types, including cash and debit cards.

The data has not been adjusted for inflation and excludes automotive sales.

According to Mastercard, overall retail sales were up 3.8 percent this holiday season from 2023, when they increased by 3.1 percent from the previous year. The last five days of the holiday season this year accounted for 10 percent of all holiday spending, it said.

The growth was partly driven by consumers responding to promotions during the November and Black Friday shopping period, along with more spending leading up to Christmas Eve, Mastercard said.

Major retailers, including Walmart and Amazon.com, ramped up promotions to entice shoppers during this year’s shorter-than-usual holiday season.

According to Mastercard, shoppers splurged mostly on jewelry, which saw sales rise by 4 percent, followed by electronics (3.7 percent) and apparel (3.6 percent) from last year.

Additionally, consumer demand for experiences such as dining out saw a marked increase this holiday season, with restaurant spending growth increasing by 6.3 percent year on year, Mastercard found.

Shoppers also appeared to prefer making purchases online this year, according to the preliminary insights. The data show that online retail sales grew by 6.7 percent from November to December this year from 2023, while in-store sales increased by 2.9 percent.

Notably, most Americans who shopped online purchased apparel, and that sector saw a 6.7 percent increase in online purchases from last year.

Shoppers Searching for Bargains

Mastercard found that some cities—particularly Tampa and Phoenix—emerged as leaders in e-commerce during the 2024 holiday season, with a 10.6 percent and 10 percent growth in e-commerce sales, respectively, compared to 2023.

Minneapolis, Dallas, Charlotte, Orlando, and Houston also came in well above the national total for e-commerce sales compared to last year, Mastercard said.

Rising retail sales occurred even though consumers faced higher prices this year amid lingering inflation, suggesting that budget-conscious shoppers are still willing to part with their cash as long as they can get a bargain.

Michelle Meyer, chief economist at Mastercard Economics Institute, said the holiday shopping season “revealed a consumer who is willing and able to spend but driven by a search for value,” as seen by concentrated online spending during the biggest promotional periods.

“Solid spending during this holiday season underscores the strength we observed from the consumer all year, supported by the healthy labor market and household wealth gains,” Meyer said.

Consumer spending accounts for nearly 70 percent of U.S. economic activity, and the latest data highlight a resilient consumer despite economic uncertainty.

A broader picture of how Americans are spending their money will be available in January when the National Retail Federation, the nation’s largest retail trade group, releases its two-month sales figures from the Commerce Department.

The latest data come shortly after the Federal Reserve announced its third consecutive interest rate cut of 2024, lowering the benchmark rate by 25 basis points to between 4.25 percent and 4.5 percent.

However, the central bank also said it expects just two rate cuts in 2025, half a percentage point less than it forecasted in September, suggesting officials are opting for a more conservative approach to loosening monetary policy.