Fueled by the coronavirus pandemic, online shopping surged by 49 percent this holiday season in the U.S., ultimately beating analysts’ expectations.
According to this year’s Mastercard SpendingPulse report, which tracks online and in-store retail sales across all payment methods, total retail sales witnessed an increase of 3 percent over the extended 75-day holiday period. This comes as a positive surprise as analysts had predicted an increase of just 2.4 percent.
Furthermore, a 3 percent increase fairs well in comparison to the 3.5 percent drop the U.S. witnessed during the last recession in 2008.
And given the challenges the coronavirus pandemic has brought upon, Steve Sadove, senior adviser for Mastercard and former chief executive officer of Saks Inc., considers the increase to be “a very healthy number.”
“That shows me the American consumer is highly resilient.”
Furthermore, according to the Mastercard report, online sales increased by an astounding 49 percent from just a year ago, with eCommerce accounting for one in five dollars spent.
This year, the Mastercard SpendingPulse analyzed spending an extended 75-day holiday period (October 11 through December 24) as many retailers opted to start their holiday sales earlier to make up for the lack of in-store foot traffic. In prior reports, SpendingPulse analyzed the traditional holiday period going from November to Christmas Eve.
The category to show strong performance through the holiday season was the home segment. As consumers continue to find themselves hunkered down at home during the pandemic, the sale of furniture and furnishings increased by 16 percent, while home improvement products witnessed a 14 percent increase in comparison to just over a year ago.
In terms of the weakest categories, apparel plummeted by 19 percent, while spending on luxury products saw a 21 percent decline.
And while Klarna reported that 64 percent of last-minute shoppers planned to shop in-store, department store performance still lagged due to the fact that shoppers found themselves still wary of shopping in-store. That said, total retail sales at department stores during the extended season dropped by 10 percent.