Let's start off with the rosy report. The National Retail Federation is reporting that:
...212 million shoppers visited stores and websites over Black Friday weekend*, up from 195 million last year. People also spent more, with the average shopper this weekend spending $365.34, up from last year’s $343.31. Total spending reached an estimated $45.0 billion.Not too shabby. That's more than GM managed to raise with their IPO, after all. But they report additional good news:
While shoppers seemed focused on getting good deals, items of strong value seemed to win out over the absolute lowest prices. According to the survey, both department stores (52.0% this year vs. 49.4% last year) and clothing stores (24.4% vs. 22.9%) saw healthy increases in traffic, while the percentage of people who shopped at discounters declined 7.2 percent, from 43.2 percent last year to 40.3 percent this year. As retailers leverage their websites to offer Black Friday prices to shoppers who don’t want to fight crowds, the percentage of people who shopped online this weekend rose a healthy 15.2 percent, from 28.5 percent last year to 33.6 percent this year – a strong sign heading into Cyber Monday.Based on the strength of this survey, they're predicting that overall sales for the 2010 holiday season should be up 2.3%. That's still below the 10 year average of 2.5%, but its better than 2009's 0.4% increase and far, far better than 2008's 3.9% decrease. So Merry Christmas, the recession is over!
Well, not so fast.
The NRF is not the only entity out there making these sorts of reports and projections. Let us turn now to ShopperTrak. Their survey shows a slightly different picture:
The traditional kick off to the holiday shopping season provided mixed messages to retailers as Black Friday sales showed a very slight increase over last year despite record spending for the day 0.3 percent increase versus the same period in 2009. According to ShopperTrak, retail sales increased a very slight 0.3 percent versus last year with consumers spending $10.69 billion in various retail locations. Comparatively sales on Black Friday 2009 increased 0.5 percent versus Black Friday 2008, with $10.66 billion spent.That was a little different. What do they say about sales projections for the 2010 holiday season?
Better than expected response to early sales promotions mixed with relatively mild weather throughout the country is already driving holiday traffic to malls and retail outlets, allowing ShopperTrak to revise its 2010 holiday forecast. According to the company’s Retail Sales Estimate (NRSE), sales during the upcoming holiday shopping season (Nov. / Dec.) are now expected to increase 3.2 percent versus last year (up from the 2.9 percent originally anticipated), while the company’s Retail Traffic Index (SRTI) is forecasting a 1.0 percent traffic increase for the same period (a substantial rise from the previously expected 0.1 percent decline).Interesting. They report far a far less dramatic increase in Black Friday sales, but project a much more dramatic improvement in overall sales for the holiday season.
So, did we see a 6.4% increase in Black Friday sales, or a 0.3% increase? Will we see a 2.3% increase in sales for the season, or a 3.2% increase? Who's right? Who should we believe?
The answer to the last question is simple. Do what economists and policy makers will do.
Pick the one that suits your agenda best.