Millions of Americans were avoiding shopping malls and instead reaching for their smartphones to land Black Friday bargains, fuelling a boom in online orders over the extended Thanksgiving holiday.
Early data showed Amazon was on track to be a big beneficiary of the smartphone splurge as it grabbed an even larger share of consumer spending than last year, while weaker malls and department stores were set to miss out on the seasonal cheer.
“The lines aren’t what they used to be,” said Charlie O’Shea, lead retail analyst at Moody’s, who toured stores in suburban Philadelphia after doors opened on Thanksgiving. “People have more options.”
Hefty discounts were offered online long before Friday, reducing the need to rush to stores. TVs were being promoted heavily, with Amazon offering 50 per cent off some 4K models.
E-commerce spending totalled $57.5 billion in the four weeks up to and including Thanksgiving, a like-for-like rise of about 16 per cent from a year ago, according to estimates from Adobe Analytics. It projected an additional $7.5 billion for Black Friday.
US retail sales in November-January period, according to Deloitte.
Almost half the estimated $4.4 billion worth of online purchases on Thanksgiving was made on mobile phones, Adobe said, compared with about a third last year.
Top selling items included children's toys from the Disney movie Frozen II and LOL Surprise dolls.
Air fryers – kitchen gadgets – were selling well, as were Apple AirPods and Amazon Fire TVs. Popular video games included the music title Just Dance 2020 and basketball simulation NBA 2K20.
Initial figures pointed to Amazon increasing its lead over rivals online.
Of the top 10 digital vendors, Amazon captured a 61 per cent share in the week before Thanksgiving, according to figures from Edison Trends, compared with a 57 per cent share a year ago.
The company’s digital sales jumped 37 per cent in the period, Edison Trends figures showed. Only Walmart, which has a far smaller online business than Amazon, had a bigger rise, up 53 per cent.
In a sign that declining fortunes in stores is also translating to weakness online for some brands, digital spending at the department stores Kohl’s and JCPenney fell 6 per cent and 30 per cent, respectively, over the period.
Several forecasters predict total US consumer spending, which has been a source of resilience for the global economy, will remain strong over the holiday season despite concerns about trade tariffs.
Deloitte expects US retail sales to total $1.1 trillion over the November-January period, a rise of between 4.5 and 5 per cent from the same period a year ago. However, the season is threatening to widen the gulf between winners and losers in US retail.
Strong financial results released within the past two weeks have shown the big box retailers Walmart and Target, as well as discounters including TJX, are faring well. In stark contrast, several department stores and other mall-based companies posted sales declines.
Footfall overall at physical retailers in the run-up to the peak shopping season was weak, declining 5.5 per cent year-on-year in October, according to RetailNext.
Rod Sides, US retail practice leader at Deloitte, said consumers were even more willing to shop online over the Thanksgiving period than during the rest of the year. “Convenience is a big factor,” he said.
Retailers were set for a busy extended weekend online. Walmart on Friday unveiled discounts for Cyber Monday, including 45 per cent off Fruit of the Loom pyjamas, 35 per cent off a Ninja air fryer and 25 per cent off a Graco baby car seat.
Copyright The Financial Times Limited 2019