Even though the economy was getting better, Mastercard SpendingPulse says that US jewelrysales slip despite holiday season. From November 1 to December 24, store sales overall (not including cars) went up by 3.1% year over year. Restaurant meals saw the most growth, up 7.8%, followed by clothing, which saw growth of 2.4%.
The numbers show all kinds of store sales across the country, not just credit or debit cards. All-around online sales went up 6.3%, while in-store sales only went up 2.2%.
In a holiday retail landscape marked by dynamic shifts in consumer preferences, US jewelry revenues experienced a notable decline during the 2023 festive season, as reported by Mastercard SpendingPulse. The data, released on Tuesday, highlighted a 2% year-on-year drop in retail sales for the jewelry category between November 1 and December 24. While this decline was softer than the previous year's 5.4%, it underscored a discernible transformation in spending patterns.
The jewelry sector's dip was juxtaposed against robust performances in other categories, particularly restaurants, and apparel, signaling a distinct shift in consumer focus. Michelle Meyer, Chief Economist for Mastercard Economics Institute, remarked on the trend, stating:
This holiday season, the consumer showed up, spending in a deliberate manner.- Michelle Meyer
Meyer pointed to a favorable economic backdrop, citing healthy job creation and easing inflation pressures as factors empowering consumers to pursue the goods and experiences they value most. The contrast with the prior year's downturn, attributed to inflation and a surge in experiential spending, emphasized the adaptability of consumer habits.
Overall, retail spending exhibited a positive trajectory, witnessing a 3.1% year-on-year increase for the two months, excluding automotive sales. E-commerce outperformed traditional in-store purchasing, growing at 6.3% compared to the latter's 2.2%. Despite the faster pace of online spending, Mastercard emphasized that physical retail locations still constituted a "considerably larger" share of total retail purchases.
The report indicated that, aside from jewelry, electronics also experienced a decline, falling by 0.4% year on year. Conversely, spending at restaurants surged by an impressive 7.8%, while apparel and groceries registered gains of 2.4% and 2.1%, respectively.
Steve Sadove, Senior Adviser for Mastercard, shed light on the dynamics of the season, stating, "Retailers started promotions early this season, giving consumers time to hunt for the best deals and promotions."Sadove emphasized that consumers aimed to maximize their spending, reviving trends reminiscent of the pre-pandemic era.
Economists looked at consumer spending, which makes up almost 70% of U.S. economic activity, as a key indicator of the country's financial healthduring the 2023 holiday season. Amid worries about the economy, people closely watched how people spent their holiday money. Rising prices for everyday items, less savings, and a rise in credit card debt made people doubtful about Americans' desire to spend.
Because of these worries, stores carefully started offering discounts on holiday goods in October, which was earlier than what they did last year. After having to deal with warehouses that were too full last year, retailers were cautious about their inventory levels going into the Christmas season.
Next month, the National Retail Federation, which is the biggest retail trade group in the country, will release a report that gives a full picture of how Americans spend their money. The federation will share two-month totals based on sales data from the Commerce Department for November and December.
The trade group predicts a 3% to 4% rise, which is a little less than the strong 5.4% growth seen the previous year because they expect holiday sales to be more complicated. But this prediction is more in line with how Christmas spending usually went from 2010 to 2019 (before the pandemic caused problems) when it consistently went up by 3.6%.
The 2023 holiday season showcased a nuanced consumer landscape with a 2% slip in US jewelry sales, contrasting against a 3.1% overall retail increase, excluding automotive sales. Consumer preferences shifted toward robust performances in restaurants and apparel, reflecting adaptability amidst changing economic conditions.
As shoppers exhibited a deliberate spending mindset, online purchases surged by 6.3%, outpacing brick-and-mortar growth at 2.2%. The early start to promotions allowed consumers to maximize their spending across various categories, echoing pre-pandemic trends.