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Will the Grinch Steal Christmas?

Will the Grinch Steal Christmas?

| December 08, 2020

The start of the holiday shopping season can provide important clues about the economy's state and, more importantly, overall consumer confidence. So far, the results have been a “mixed bag” with empty malls and busy websites.

Sales in November and December account for 20% of annual retail sales, but that number can be higher for some retailers. Holiday sales also tend to be more profitable since the increased activity comes without having to boost the fixed costs of doing business.1

It should come as no surprise to hear that consumers avoided in-store visits over the Thanksgiving weekend. Spending dropped 22% from last year’s levels.2

But the numbers look much better when a longer time frame is considered. Spending prior to the Thanksgiving-to-Sunday period surged 66% from a year earlier, in part thanks to large retailers introducing Black Friday-like deals as early as mid-October.2

As you might have guessed, the pandemic has led to an acceleration in shopping online. Cyber Monday sales jumped 15% over last year’s levels as consumers spent almost $11 billion, making it the largest U.S. online shopping day ever.3

Holiday shopping can provide some key insights, but it’s important to know what forecast was expected and what comes as a surprise. If you see a holiday trend emerging, please give us a call. We’d welcome the chance to hear your thoughts and see how it compares to what we’ve been seeing.

  1. National Retail Federation, 2020
  2., November 30, 2020
  3. CNBC,com, December 1, 2020

Any industries mentioned are for illustrative purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation.