Although the time has changed, consumers are retreating ahead of expected sales later in the season, which hasn’t increased overall retail sales.
Consumer behavior and trend tracker Circana reports that although U.S. retail spending is unchanged, consumers are “adjusting to purchase behavior.”
Compared to the same period in 2023, overall retail sales of consumer packaged goods (CPG) and general items increased by 1% in units and 3% in USD for the five weeks ended October 5. Retail dollar sales of discretionary general products fell 1%, although unit demand rose 1%. Retail food and beverage sales revenue and non-edible CPG sales revenue both increased by 4%, while unit sales performance improved by 1% year over year.
Marshal Cohen, chief retail industry advisor for Circana, stated, “Consumers continue to demonstrate their resilience, both in their willingness to spend when the value is there and their ability to adapt in order to maximize that value.” “Ahead of the holiday shopping season, consumers are feeling optimistic, but more is required to support retail growth.”
Consumer spending on discretionary general products and their purchasing patterns throughout key retail promotional weeks were consistent, according to the early analysis of this year’s fall retail promotion weeks. The pre-promotion decrease in purchasing helped to boost sales revenue for discretionary general merchandise* during the two weeks ending October 12 compared to the two weeks prior. Over the previous two years, pre-promotion withdrawal behavior has been consistent in both fall and summer retail promotions.
Along with a picture of consumer purchasing patterns, seasonal cues started to emerge in the performance of general merchandise discretion in recent weeks. Numerous industries, including office supplies, home, car, and prestige cosmetics, are maintaining a comparatively stable sales pace, which is probably going to continue. Stabilizing technology sales and the narrowing growth gap in the toy market are encouraging indicators. The holiday season is a time to meet pent-up demand for clothing, accessories, and footwear as deep losses in fashion sectors persist.
“Retailer-driven promotional events may benefit certain retailers and products, but they have less of an effect on overall retail sales, and the consumer is the real beneficiary,” Cohen continued. “From inquiry to intent, retailers and manufacturers must help customers understand the value of purchases or tailor their offerings to meet their needs.”
