Inflation hovers over shoppers heading into Black Friday
NEWYORK — Shoppers searched for the best Black Friday deals online and in stores. Retailers offered new Black Friday discounts to encourage shoppers to buy holiday gifts, but they were being weighed down by inflation.
Due to elevated prices for food, rent, gasoline and other essentials, many people were reluctant to spend unless there was a big sale.
Shoppers were more selective in choosing cheaper options, saving more, and turning to “buy now, then pay later” services that allow installment payments. Some were also maxing out their credit cards while the Federal Reserve raises rates to cool the U.S. economy.
Sheila Diggs went to a Walmart near Mount Airy, Maryland on Friday morning to look for a great deal on a coffeemaker and to see what else was available. She stated that her family is being more careful about holiday spending this year. Usually, all of the family members would exchange gifts. She said that this year everyone is drawing names and choosing one person because things are more expensive.
“Everything’s going up but your paycheck,” said Diggs, who manages medical records at a local hospital.
This year’s trends are quite different from last year, when consumers bought early in fear of not receiving what they needed due to supply-network clogs. Because they couldn’t bring in the items, stores didn’t have much to discount.
This year, shoppers are looking for the best deals, according to Rob Garf (Vice President and General Manager of Retail at Salesforce), which tracks online sales. After offering low-quality discounts earlier in the season, retailers responded this week by offering more attractive deals online.
Online discounts rates were 31% on Thanksgiving, up 7% from the previous year, according to Salesforce data. The most expensive discounts were found in home appliances, general apparel and makeup, as well as luxury handbags. Online sales for the holiday increased by 9% over last.
“Retailers have finally stepped up the discounting game and consumers are responding in kind,” Garf said.
Macy’s Herald Square in Manhattan, where discounts included 60% off fashion jewelry and 50% off select shoes, was bustling with shoppers early Friday. The traffic to Macy’s Herald Square in Manhattan was significantly higher than the previous two years due to shoppers feeling more comfortable in crowds.
He said that bestsellers from Macy’s online sale, which started last weekend, included 50% off beauty sets. Macy’s had supply chain problems last year, and some gifts didn’t arrive until after Christmas.
“We are now ready and set to go, he said.
Sophia Rose, 40, a respiratory specialist visiting Manhattan from Albany, New York, was heading into Macy’s with big plans to splurge after scrimping last year when she was still in school. She put herself on a budget for food and gas to cope with inflation but had already spent $2,000 for holiday gifts, and plans to spend a total of $6,000.
” “I am going to touch each floor,” she said. “That’s the plan.”
A Best Buy store in Manhattan had TVs stacked up high including Samsung 50-inch TVs marked down to $297, a savings of $82.
Delmarie Quinones, a 30-year-old health home aide from the Bronx, was only there to pick up a laptop and printer she ordered online at $179 — down from $379 — as part of a Black Friday sale.
Quinones stated that she is having to cut back on her spending after the increase in food prices and other expenses. This is a contrast to a year ago when she was able to use money from her government child tax credit payments.
“I can’t get what I used to get,” said the mother of five children, ages 1 to 13. “Even when it was back to school, getting them essentials was difficult.”
Major retailers including Walmart and Target stuck with their pandemic-era decision to close stores on Thanksgiving Day, moving away from doorbusters and instead pushing discounts on their websites.
People are still shopping online on Thanksgiving. Garf stated that online sales rise in the evenings during Thanksgiving, suggesting that people have switched from eating to shopping on the phone. He also said that holiday travel has led to a higher percentage of online shopping occurring on mobile devices.
” The mobile phone has become the remote control in our daily lives and this led to an increase of shopping on the couch after Thanksgiving dinner,” Garf stated.
Against today’s economic backdrop, the National Retail Federation — the largest retail trade group — expects holiday sales growth will slow to a range of 6% to 8%, from the blistering 13.5% growth of a year ago. These figures include online spending and are therefore not adjusted for inflation. Real spending could be even lower than a year ago.
Adobe Analytics expects online sales to be up 2.5% from Nov. 1 through Dec. 31, a slowdown from the 8.6% pace last year, when shoppers were uncertain about returning to physical stores.
Analysts see the five-day Black Friday weekend (which includes Cyber Monday) as a key indicator of shoppers’ willingness and ability to spend, especially this year. The two-month period between Thanksgiving and Christmas represents about 20% of the retail industry’s annual sales.
Hadero reported from Mount Airy, Maryland. Olson reported from Arlington in Virginia. Cora Lewis, Associated Press Personal Finance Writer in New York, contributed to this report.
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I have been writing professionally for over 20 years and have a deep understanding of the psychological and emotional elements that affect people. I’m an experienced ghostwriter and editor, as well as an award-winning author of five novels.