Election blues could trim 2016's holiday spending
The nastiest presidential election in recent memory may have cooled consumers’ interest in holiday spending.
According to an analysis released Thursday by Adobe (ADBE) Marketing Cloud of 18.1 billion visits to retail websites, online sales rose 1.3 percent between Nov. 1 and Nov. 14, well under the 7.8 percent that had been forecast. Most of the decline happened after Republican Donald Trump’s upset victory over Democrat Hillary Clinton. By Adobe’s reckoning, businesses lost out on more than $800 million in sales.
“Instead of the expected 11 percent year-over-year increase, we expect growth to fall to single digits this year,” said Tamara Gaffney, principal analyst and director at Adobe Digital Insights. “Sales on Thanksgiving Day and Black Friday next week will be an important indicator of how much sales expectations need to be adjusted this shopping season.”
According to Adobe, the data shows the slowest growth the U.S. has seen in online spending since the company began tracking the activity four years ago. The company also found that for the first time, visits to shopping websites and apps have fallen below the rate of previous years.
Gaffney told CBS MoneyWatch she doesn’t expect consumers to make up for the election shortfall during the rest of the holiday season. However, she noted that doesn’t necessarily indicate that retailers will have a humbug of a holiday season because they’re managing their inventories this year by using fewer discounts.
“When the time period gets shorter ... people just don’t shop as much,” she said. “The just don’t buy for other people who might be second- or third-tier on their lists.”
Ecommerce represents about 10 percent of total retail sales, and expectations for the holiday season overall are bullish.
The National Retail Federation expects holiday sales to jump 3.6 percent to $655.8 billion, well above the 10-year average of a 2.5 percent rise. Consulting firm PWC expects holiday spending to hit its highest level this year since the Great Recession, increasing 10 percent over last year. It sees online sales alone surging 25 percent.