Circana reported that U.S. retail spending remains stable, but consumers are adjusting to purchase behavior based on data analyzed from the five week period ending October 5.
Overall retail sales for the 5-week fiscal September period, as defined by the National Retail Federation (NRF), were up 3 percent in dollars and 1 percent in units across general merchandise and consumer packaged goods (CPG) categories, compared to the comparative period 2023.
The company said its measurement of discretionary general merchandise retail dollar sales declined by 1 percent while unit demand increased by 1 percent. Both non-edible CPG and retail food and beverage sales revenue grew 4 percent, and year-over-year unit sales performance increased 1 percent.
“Consumers continue to demonstrate their resilience, both in their willingness to spend when the value is there and their ability to adapt in order to maximize that value,” said Marshal Cohen, chief retail industry advisor at Circana. “There is consumer optimism ahead of the holiday shopping season, but more is needed to fuel retail growth.”
Circana said the preliminary read on this year’s fall retail promotion weeks revealed consistency in consumer spending on discretionary general merchandise and purchase behavior around major retail promotional weeks.
“While sales revenue for discretionary general merchandise, excluding janitorial and breakroom categories, during the two weeks ending October 12, 2024, brought a lift from the two weeks preceding, that lift was aided by pre-promotion pullback in purchasing. The same pre-promotion pullback behavior has occurred during both fall and summer retail promotions over the past two years,” the company noted in a media release.
“In addition to a picture of consumer spending behavior, holiday indicators began to take shape in recent weeks’ performance as it relates to discretionary general merchandise,” the company said.
Many industries, including prestige beauty, home, auto, and office supplies, have reportedly been held at a relatively steady sales pace, which Circana said will likely continue. Encouraging signs likely come from stabilizing tech sales and closing the gap in toy industry growth. The company assessed that deep declines continue in fashion categories, setting up the Holiday selling season to fill pent-up demand in apparel, footwear and accessories.
“While specific retailers and products may reap rewards from retailer-driven promotional events, there is less impact on overall retail sales, and the consumer emerges as the big winner,” added Cohen. “Retailers and manufacturers need to get consumers to see the importance of purchases or optimize based on their needs at every step from inquiry to intent.”
