Retail sales remain on pace toward a better holiday

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Retail sales were kept on pace toward a better holiday by October sales results—although sales gains continue to favor e-commerce and in-store sales at homegoods retailers.

Topline sales in October grew at the 4% or better pace expected for the holiday (see forecast here).

In-store sales also improved slightly to an estimated 2.9% gain, but that in-store growth continues to be squeezed by e-commerce gains of 15%. In-store growth also remains skewed to home improvement and home furnishings retailers.

These results exclude auto, fuel, and restaurant sales. Here is more on what the latest government-reported retail numbers say:

  • Monthly trend. Monthly year-to-year growth remained near 4.0% in October for the third month in a row on a seasonally adjusted or unadjusted basis (excluding auto, fuel, and restaurant sales). This is an improvement from growth between 3.0% and 3.5% for the first months of the year.
  • Quarterly trend. Since the second half of 2016, a slowly improving quarterly trend has emerged clearly as measured in the seasonally adjusted and unadjusted data.
  • Annual trend. Despite the recent improvement, 2017 year-to-date results are lagging prior years in both traditional retail sales and in the auto and restaurant sectors.
  • E-commerce effects. The in-store improvement (+2.9% growth) in October is focused among homegoods retailers, which grew better than 6% from a year ago. Apparel and department stores (flat or down) continue to show the greatest toll from the e-commerce gains of 15%. Food, drug, and mass retail stores slowed from September but grew better than a year ago.

The e-commerce impact at a monthly level is estimated based on quarterly e-commerce sales reported by the government through the third quarter of 2017.

The improving trend toward the holiday has been supported by the latest signs from consumers’ confidence to spend over the next 90 days. Spending confidence reverted to an improving outlook in October as hurricane and other weather effects have subsided. See more about confidence trends here.

For detail on the spending trends and related macro-shopper insights, see the select products below or the full product and subscription options here:

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