Retail is having its best holiday shopping season in six years, according to early data tracking consumers’ purchases.
in line with earlier reports that showed robust growth in e-commerce this holiday season.
And this all comes amid the latest fluctuations in the stock market, worries on Wall Street about a potentially slowing economy and a partial government shutdown. Consumer confidence remains strong, translating into robust retail sales, said Steve Sadove, former CEO of Saks and currently advisor for Mastercard.
Over the past few weeks, “many retailers were able to give consumers what they wanted,” he added.
Some of the strongest sectors within retail this holiday season include apparel and home improvement, according to Mastercard. Apparel sales were up nearly 8 percent from Nov. 1 through Dec. 24, their best growth since 2010, the firm said. Home improvement spending, meanwhile, was up 9 percent.
Clothing retailers like Lululemon, Abercrombie & Fitch and Old Navy had already kicked off the holiday shopping season on a high note, seeing strong sales during Black Friday weekend. Analysts say companies that sell apparel have done a better job in 2018 managing inventory and keeping product assortments fresh, but there are still going to be “losers” in the space.
“Not all apparel is doing great,” Craig Johnson, president of retail advisory firm Customer Growth Partners, told CNBC. The biggest growth over the past few months has stemmed from activewear retailers like Nike and off-price companies like T.J. Maxx, he said.
Meanwhile, big-box retailers like Walmart and Target have invested in their websites — in addition to what they’re doing in stores — to try to grab more sales online, but the majority of purchases are still happening on Amazon. The e-commerce giant was taking a whopping 81 percent of internet sales from Dec. 1 to Dec. 19, according to Edison Trends, a firm that tracks the market share of online retailers. Amazon then said Wednesday that it sold a record number of items this holiday season, though it didn’t disclose any revenue figures.
A sector that continues to struggle within retail is department stores, even with the boost other companies are seeing.
Sales at U.S. department stores were down 1.3 percent from Nov. 1 through Christmas Eve, Mastercard said, attributing some of the decline to store closures. But Mastercard said department store operators have been performing better online. The group’s e-commerce sales were up 10.2 percent in the run-up to Christmas.
“Department stores in aggregate have been losing market share and not performing like other sectors,” Sadove said. But there are some companies, like Macy’s, within the group that are still growing, he said.
Many retailers will start to report holiday sales figures in the coming weeks, and analysts will be looking to see which companies benefited the most from the latest surge in spending.