Consumers are expected to go shopping Thanksgiving week online and in stores with sales projected to grow 10% over last year and 12.2% from the same period in 2019, according to Mastercard Spending Pulse.
Mastercard’s Spending Pulse report measures retail sales including cash and check. A growing number of retailers from Amazon to Walmart have already begun offering their holiday deals and report solid demand and consumer traffic going into Thanksgiving week. E-commerce is also expected to experience sustained growth of 7.1% year-over-year and jumping 50.2% from Thanksgiving 2019. The National Retail Federation also predicts almost 2 million more people than last year are expected to shop from Thanksgiving Day through Cyber Monday this year.
“We’re expecting another record-breaking holiday season this year and Thanksgiving weekend will play a major role as it always has,” NRF President and CEO Matthew Shay said. “Nonetheless, consumers are starting earlier than ever to be sure they can get what they want, when they want it, at a price they want to pay. Black Friday stopped being a one-day event years ago, and this year some consumers started shopping for Christmas as early as Halloween.”
The trade group said 66% of holiday shoppers surveyed in early November plan to shop Thanksgiving weekend this year. That adds up to 158.3 million people. While that’s an increase from last year, it is still below the 165.3 million who said they shopped Thanksgiving weekend before the pandemic. A growing number of stores, including Best Buy, Walmart, Kohl’s and Targe, have said they will be closed Thanksgiving . NRF found 30.6 million said they plan to shop either in-store or online on Thanksgiving Day. The majority of those planning to shop on Thanksgiving Day (65%) said they shop in stores. This is up from 50% last year. Black Friday shoppers (64%) said they plan to shop in stores, up from 41% a year ago when COVID concerns were higher.
Walmart and Target said this week consumers have already started their holiday shopping well before Thanksgiving week. The NRF survey found 46% started earlier this year than they typically do. While the bulk of shopping may be yet to come, consumers said had completed 28% percent of their holiday shopping by early November.
“Shopping early is a trend we’ve seen for years and it began long before the pandemic,” Prosper Executive Vice President of Strategy Phil Rist said. “While some consumers like the thrill of last-minute shopping and others just procrastinate, many prefer the comfort of having the shopping done early so they can relax and enjoy the season.”
Apparel tops 53% of consumer’s holiday shopping list this year, followed by gift cards (46%) and toys (39%). Prosper Insights estimates gift cards will be big again this year with expected spending to total $28.1 billion the highest since 2018. Shoppers said they plan to buy an average three or four cards this year with an average $48.92 per card, including restaurant cards (cited by 32%), department store cards (26%), bank-issued gift cards also (26%) and coffee shop cards (20%).
Mastercard’s survey indicated consumers looking for discounts may be disappointed this year as inventory constraints felt around the retail sector in many categories like apparel, jewelry and toys will mean few markdowns.
“Holiday lights are shining bright for retailers this year,” said Steve Sadove, senior advisor for Mastercard and former CEO and Chairman of Saks Incorporated. “The consumer is strong and spending. With discounts in short supply, product innovation, availability and sustainability will be deciding factors for consumers eager to cross off their holiday shopping lists.”
According to Mastercard, October U.S. retail sales excluding auto and gas increased 6.1% year-over-year and 12.9% compared to October 2019. E-commerce sales in October rose 13.2% year-over-year and 76.7% over 2019 when compared to the same periods.