Arrow-right Camera

The Spokesman-Review Newspaper The Spokesman-Review

Monday, October 26, 2020  Spokane, Washington  Est. May 19, 1883
Partly Cloudy Night 29° Partly Cloudy
News >  Business

Holiday sales may have jumped 4.9% in biggest gain since 2005

In this Nov. 25, 2016 photo, Maddy, left, and her friend Maggie, sit with their shopping bags at Union Square in San Francisco. (Jeff Chiu / Associated Press)
In this Nov. 25, 2016 photo, Maddy, left, and her friend Maggie, sit with their shopping bags at Union Square in San Francisco. (Jeff Chiu / Associated Press)
By Lauren Coleman-Lochner Bloomberg

Holiday shoppers abandoned their early reluctance and boosted spending as the season wore on, pushing U.S. sales to the biggest increase in more than a decade, according to research firm Customer Growth Partners.

On Tuesday, the firm raised its holiday sales estimate to a 4.9 percent gain over last year to $637 billion. That would be the biggest increase since 2005. Customer Growth had previously predicted a 4.1 percent advance.

Online sales grew an estimated 15 percent, up more than a percentage point from the firm’s previous forecast. Sellers of consumer electronics, home-improvement goods, beauty products, and toys saw robust sales and minimal markdowns, according to Craig Johnson, Customer Growth’s president. Low unemployment and fuel prices, as well as real disposable income gains, boosted spending.

Then there was clothing. “You saw rampant discounting,” with 40 percent off required to even get customers in the door and half off to get them to buy, he said.

“If your name is Home Depot, your margins are going to be great,” Johnson said in an interview. For clothing and department-store chains, “you’re going to have trouble.”

Pre-election jitters and unseasonably warm weather produced a slow October that bled into a similarly wan November – until the middle of the month, when spending came back, Johnson said. Even the normal early-December slowdown, when shoppers take a break between Thanksgiving sales and last-minute deal frenzies, was shallower than normal, he said. The firm’s forecast excludes sales from autos, auto parts, fuel and restaurants.

The post-Christmas week is shaping up strong, Johnson said, helped by a variety of factors including most workers getting Dec. 26 off. Retailers in recent years have increasingly seen the week after the holiday, when customers make returns and exchanges, as a chance to lure them with a new selection of full-price merchandise.

“Instead of just being a neutral or a negative, it’s a plus,” he said.

The Spokesman-Review Newspaper

Local journalism is essential.

Give directly to The Spokesman-Review's Northwest Passages community forums series -- which helps to offset the costs of several reporter and editor positions at the newspaper -- by using the easy options below. Gifts processed in this system are not tax deductible, but are predominately used to help meet the local financial requirements needed to receive national matching-grant funds.

Subscribe to the Coronavirus newsletter

Get the day’s latest Coronavirus news delivered to your inbox by subscribing to our newsletter.

New health insurance plans available Nov. 1 through Washington Healthplanfinder

 (Photo courtesy WAHBE)

Fall means the onset of the cold and flu season.