Retail holiday sales should continue to increase during the 2023 holiday season between 3%-4%, according to the National Retail Federation. Since 2009, sales in the retail industry have grown annually with the highest increase reaching 13.5% in 2021, shattering previous records.
Although the growth rate is slower this year than in recent years, the increase is in line with pre-pandemic growth levels. Not surprisingly, online sales are also set to increase between 7%-9%.
“Consumer behavior continues to shift post-COVID-19,” said Cailey Locklair, president of the Maryland Retailers Alliance. “Consumers should be reminded to support local stores as much as possible, as they impact our communities with jobs and tax revenue to support the things we all care about.”
Individual spending is projected to be up slightly this year, with an expected consumer average of $875 to be spent on holiday gifts, décor and other items, according to NRF’s latest holiday survey. Gift cards, clothing, accessories, books and other media are slated to be the highest categories for spending, following shopping trends set in recent years.
Additionally, data from NRF’s consumer survey showed that a majority of shoppers plan to make holiday purchases online, followed by shopping at department and discount stores. Grocery stores, clothing stores and small, independent businesses ranked behind.
For the past two years, the majority of MRA members felt they would have strong holiday seasons when surveyed. This year, members are cautiously optimistic, with small businesses expressing more concern about consumer confidence and the health of the economy.
Also, many businesses have maintained consistent advertising spending as compared to 2022, indicating confidence in repeat customers and brand loyalty. Top concerns members cited in 2023 included difficulty in bringing on adequate staff numbers, lower consumer spending due to inflation, and the impact of weather on manufacturing and product shipping.
“Customers have continued to start their shopping earlier in the year, spreading their spending out over time in preparation for the holiday season,” said Locklair. “Retailers are ready with Black Friday preview sales scheduled throughout the fall and the ability to price-match online discounts in-store. Retailers were prepared for consumers to start early and will continue to offer excellent deals online and in brick-and-mortar through Christmas.”
MRA’s annual holiday forecast is based on member surveys in conjunction with a review of the NRF’s holiday forecast, consumer trends and historical retail sales data.