Steep discounting helped drive strong retail sales on Black Friday, according to Mastercard SpendingPulse, which measures in-store and online retail sales across all forms of payment.
According to the report, U.S. retail sales on Friday rose 12% year-over-year excluding automotive. Stores continue to gain traction post pandemic, with in-store sales up 12%. E-commerce sales also grew, rising 14% year-over-year.
Just as retail experts predicted, promotions were bountiful as retailers aggressively discounted in a quest to clear excess inventory.
“This Black Friday, retailers offered promotions across channels leading to strong year-over-year growth online and in-store,” said Steve Sadove, senior advisor for Mastercard. “Apparel, electronics and restaurants were strong performing sectors as consumers turned holiday shopping into a full day experience.”
“Retailers delivered on Black Friday with deals that enticed consumers to fill their carts despite the inflationary environment,” said Michelle Meyer, North America Chief Economist for the Mastercard Economics Institute.
When it comes to industry brands and retailers, some promotion examples include PacSun, which offered 50% off site-wide, and Tilly’s, which offered buy one, get one 50%. Vans offered $20 off all shoes and 40% off all apparel and accessories, and Reef and Katin offered 30% off site-wide. Sun Diego offered buy one, get one 50% off in-store, and Jack’s and HSS were 20% off site-wide.
SES checked in this morning with Luke Mesanko, who owns Wanderlust Land & Sea in New Jersey, to see how sales went over the weekend and how he handled promotions and discounting.
“We had a very strong Black Friday weekend and the total for the three days was our best ever,” Luke said. “We only did 10% off store-wide and a bunch of 20-40% sales racks. I hate giving brand new, beautiful product 20% off which seems to be the norm. If there were familiar faces, we made exceptions here and there.”
“I really am trying to manage inventory and roll back promotions as much as possible now because even though we’re still hanging on to low double digit year-over-year growth, my discount dollars are up 35% for the year – a number I’m not stoked about,” he said.
“But overall, we’re in good shape and we still have a month left,” Luke said.
The National Retail Federation (NRF) is forecasting that holiday retail sales during November and December combined will grow between 6% and 8% over 2021 to between $942.6 billion and $960.4 billion.
Last year’s holiday sales grew 13.5% over 2020 and totaled $889.3 billion, which broke previous records. Holiday retail sales have averaged an increase of 4.9% over the past 10 years, with pandemic spending in recent years accounting for considerable gains, according to NRF.
