Retailers and consumers across Nevada enter the final weeks of holiday promotions and gift buying for friends and loved ones.
When developing forecasts for the entirety of the holiday season, Black Friday and Cyber Monday results remain on the minds of many retailers. Reflecting on a changing holiday sales landscape, retailers’ sentiments were perhaps best summed up by the National Retail Federation (NRF): the holiday shopping season is ever more so “a marathon and not a sprint.” As such, it is likely that in the future, less emphasis will be placed on Black Friday and Cyber Monday as indicators of holiday retail sales success.
Remaining strongly positive about the overall holiday season, the Retail Association of Nevada (RAN) projects a 5.4-percent increase in statewide holiday sales this year. Nationwide, holiday sales expectations are more modest, with Gallup and the NRF projecting a 3.0-percent and 4.1-percent increase, respectively.
Senior Vice President of RAN, Bryan Wachter, explained that robust retail sales in Nevada contributed to a comparatively stronger statewide projection.
“Year-to-date, traditional consumer retail sales in Nevada increased 7.3 percent, compared to 3.7 percent nationwide, which contributed to more optimistic projections for our state,” he said. “Nevada taxable sales data shows an especially large increase in sales from non-store retailers (up 59.0 percent year-to-date). The increase in taxable sales reported is due to Amazon reporting its sales and remitting appropriate sales tax. These sales were unreported in the state prior to Jan. 1. Statewide holiday sales projections were adjusted to account for this effect.”
The NRF reports that from Thanksgiving Day through Nov. 30, there were an estimated 133.7 million unique holiday shoppers, down 5.2 percent from the 141.1 million unique shoppers reported in 2013. Furthermore, non-unique shoppers totaled 233.3 million during the same period, down 6.2 percent from the 248.6 million non-unique shoppers reported last year (note, these figures include shoppers who made multiple trips to stores). Average spending on Thanksgiving weekend declined 6.4 percent this year to $380.95 per person, while total sales nationwide fell 11.3 percent to an estimated $50.9 billion.
Fewer online shoppers were also expected on Cyber Monday, with the NRF reporting that 126.9 million consumers planned to make a purchase that day, down 3.6 percent from 131.6 million last year. Despite fewer shoppers, ComScore Inc., reported that online sales from a desktop computer reached a record $2.0 billion on Cyber Monday this year, which is up 17 percent from 2013 (not including sales from a mobile device). However, the company also notes that growth in Cyber Monday sales has been slowing slightly in recent years, as consumers take advantage of early deals from Amazon, eBay, Wal-Mart, Target and other online retailers. ComScore reported that from Nov. 1 through Cyber Monday, online sales reached $26.7 billion in 2014, an increase of 16 percent from the same period last year. The growth rate was double that reported in 2013 when online sales grew by 8 percent.
NRF President and CEO, Matthew Shay, emphasized that the lackluster Thanksgiving holiday weekend is not indicative of a bad holiday season. He noted that 1) holiday sales, and therefore, shopping, began well before the Thanksgiving holiday this year, 2) a healthier economy allowed consumers greater freedom in choosing what days to shop and 3) consumers knew that they could get deals well before and well after the Thanksgiving holiday. Combined, these factors suggest consumers are turning to other days during the holiday season to make their purchases.
Other sources, including The Wall Street Journal, are also reporting that not only are sales shifting to more non-traditional retail gifts such as spa services and golf lessons (i.e., more “experience-based” gifts), but also purchases such as gift cards, which are popular among many gift-givers, are generally not measured as revenue by the retailer until they are used by the recipient. As a result, holiday sales may be better measured beyond the months of October to December.