Posts filed under “Retail”

Retail Sales Increase Most in 5 years

Leading into the holiday period, the data — and by data, I refer to actual sales numbers, and not surveys, gut feelings or instincts — was strongly suggesting that the 2010 orgy of consumerism known as the holiday shopping season was likely to be stronger than expected.

The first clue I had of this was the Amazon sales from TBP. The embedded code of each link allows me to track click-throughs and purchases. All year long, it has been running significantly higher than 2009. (I’ll post some charts later this week).

Of course, plenty of people were stuck looking backwards. They gave tortured reasons as why this was not going to be a decent season. Call it a classic case of confirmation bias, these were the folks who simply refuse to acknowledge any improvements in the economy. These analysts seem to be shell shocked from the collapse; you should feel free to to do what you like, but once I recognize someone is caught in a negative loop, I tend to avoid their work until they prove they have some objectivity.

Why were the improved sales not a surprise to those people paying attention to the data? The negatives — weak job gains, housing overhang, consumer deleveraging, terrible municipal finances — were already well known all year. Even Oil over $90 was a not a big deal — it seems to have been in the $75-85 range for so long that gasoline over $3 had little shock value.

The newest data included more positives: Improving job market, equity gains, and an upcoming two percentage-point cut FICA payroll tax holiday in 2011. The 90.2% of the workforce that have jobs feel more secure (if they didn’t get laid off by now, they probably won’t). There is also a sense of widespread Recession fatigue; people are tired of living in bunkers, and are coming out to play again.

Lets consider the actual data, and what it might mean going forward:

• U.S. retailers’ 2010 holiday sales (excluding automobiles) jumped 5.5% — the best performance in five years, versus 4.1% in 2009 and down 6.1% in 2008

• Total holiday sales were $584 billion from Nov. 5 through Dec. 24, with notable increases starting as early as the second week of November

• Online seasonal sales up 15.4%; This is against an ongoing rise in online sales

• Apparel grew 11.2% over 2009 (-0.4%), with Menswear up 10.5%, and Women’s Apparel plus 5.6%

• Electronics lagged in dollar terms, growing 1.2% vs a 4.6% decline in 2009. Declining flat panel TV prices is a suspect

• Furniture sales were plus 3.8% vs minus 2.2% in 2009.

• Jewelry gained 8.4%

• Luxury (ex-Jewelry) grew 6.7% versus falling 0.9% last year.

Two last interesting datapoints worth mentioning:

Via the WSJ: 2010 consumer spending was 68.6% of the economy. This reflects an increase — yes, an increase –  from 66.5% in 2007. The reasons are 1) A sharp decrease in businesses spending; 2) The ongoing contraction of housing within the overall economy — currently at its lowest level since World War II.

Last, the US still has too large of a retail footprint — 40 square feet of retail space for each person; that is the most per person in the world. As I first noted in several speeches back in 2008, that needs to come down appreciably.

All told, a pleasant improvement over prior years . . .


Anecdotal Evidence: Shoppers Out in Full Force (November 21st, 2010)

Improving Holiday Sales Reflect Economic Recovery (November 29th, 2010)

SpendingPulse 2010 Holiday Wrap-Up Report
MasterCard Advisors’ SpendingPulse, December 27, 2010

Category: Consumer Spending, Psychology, Retail

By the Numbers: Online Holiday Shopping

My buddy Jeff, who worked at Yahoo during the glory days of the late 1990s and early 2000s, then was President of, sends this graphic along re: online shopping: > click for ginormous graphic > Source: A Case Of The Mondays: How Cyber And Green Mondays Rule Online Shopping December 17th, 2010

Category: Consumer Spending, Retail

Improving Holiday Sales Reflect Economic Recovery

The numbers are coming in, and so far, the Holiday shopping season is off to a very  respectable beginning. Mall Traffic, retail sales, even dollar volumes are all up. In some areas, improvements have been quite significant. Online sales saw very large gains. We do notice a variety of contradictions, binary conundrums and footnotes. We…Read More

Category: Consumer Spending, Retail

Amazon to Apple: We Got Yer Beatles Right Here!

With Apple finally landing the Beatles for the iTunes Music store, I wondered if the competition was going to do anything in response. For example, at the iTunes Music store, the full Beatles Boxed set — obviously misnamed, as it is 1. digital and b) minus the physical materials (which are terrific) — is priced…Read More

Category: Music, Retail

Anecdotal Evidence: Shoppers Out in Full Force

As much as I loathe anecdotal evidence, I was taken aback by the sheer insanity of the retailers this week before Thanksgiving weekend. Yesterday, I ran a few errands, and it was fairly insane. Black Friday is a full 7 days away, and the parking lots were nothing short of madness. All the usual caveats…Read More

Category: Consumer Spending, Retail

Inflation? Not According to a Billion Prices

> Those of you who regularly complain/mock/kvetch about the BLS methodology for measuring CPI prices — and I am as guilty as anyone else — should check out the “Billion Prices Project @ MIT.” The idea behind the Billion Prices Project is that we can track inflation by collecting prices from hundreds of online retailers…Read More

Category: Data Analysis, Inflation, Retail

Retailers Need a Fresh Start

Retailers need a fresh start Andy Xie Caixin Online Aug. 30, 2010 > BEIJING: China’s gross domestic product surpassed Japan in the second quarter of 2010. The international media gave this milestone considerable attention. The domestic media hasn’t paid as much attention. As natural disasters, environmental degradation and property bubbles take the center of attention,…Read More

Category: Retail, Think Tank

“Pseudo-variety”: Soft Drink Industry Structure

Rather fascinating discussion of the beverage industry from Professor Philip H. Howard of Michigan State University. He concludes there is an oligolpoly, with 3 firms controlling nearly 90% of the beverage options. This lack of competition in this industry is obscured by the apparent variety of choices. Professor Howard calls it pseudovariety – variations on…Read More

Category: Consumer Spending, Retail

Tech Gadgets vs Durable Goods

Its the first Thursday of the month, so we will be getting monthly sales from many retail stores throughout today. Related to that, I am fascinated by this story in the WSJ. Durable Goods, Furniture, Apparel are out; In: Laptops, iPads, iPods; the staycation crowd are buying Blu-ray video players and big plasma screen televisions….Read More

Category: Consumer Spending, Retail, Technology

One Last Look at Mortgage Defaults Driving Retail Sales

Yet another case of anecdote trumping evidence: I am more than willing to entertain the possibility that squatters are a key component of this economic rebound, if only someone can show me some data that supports it. However, charts like the following, that calculate liabilities owed, are only half the equation: > 7+ Million Homeowners…Read More

Category: Credit, Real Estate, Retail