American consumers went on an $11.4bn (£7bn) spending binge on Black Friday, the day after Thanksgiving that marks the start of the holiday shopping season, and retailers reported the bonanza continued yesterday on so-called Cyber Monday, when e-commerce sites offer their own discounts and deals.
The orgy of spending – accompanied by mob scenes at shopping malls around the US over the weekend – was an unexpected boon to retailers after a year of consumer frugality. But while retail sector share prices soared yesterday, chain store bosses expressed only cautious optimism for the holiday season as a whole, and economists were downright sceptical about the outlook.
The consumer economy accounts for more than two-thirds of US GDP, and the US is still the world's largest economy and the biggest end-market for manufactured goods from the second largest economy, China, so the shopping habits of the American consumer are more than just a local curiosity. Global stock markets rose yesterday in part because of optimism over developments in the European debt crisis, but also because of relief over the Black Friday sales numbers.
"Despite our sluggish economy, shoppers proved they are looking for value and ready to buy if given a good customer experience," Bill Martin, founder of the industry research firm ShopperTrak, said. Foot traffic in stores was up 5.1 per cent on Black Friday 2010, and total sales were up 6.6 per cent to a record $11.4bn, according to ShopperTrak estimates. The year-on-year jump was the biggest since 2007, Mr Martin said.
Retailers attempt to attract shoppers after the Thanksgiving holiday with what they call "door-buster deals" on items such as flat-screen TVs and tablet computers. This year, they opened earlier than the usual midnight, with Wal-Mart opening its stores at 9pm on Thanksgiving Day itself. Large queues formed at many stores ahead of the opening and, in one incident at a Los Angeles Wal-Mart, a woman used pepper spray to fight off fellow shoppers in pursuit of a discounted Xbox console.
Online sales were up 26 per cent on Black Friday, according to comScore, and Cyber Monday – the day when the US returns to work, gets back online and goes looking for online deals – was also expected to set an internet shopping record.
The spending spree comes against a backdrop of high unemployment and job insecurity and a weak housing market, but recent indicators have shown a modest improvement after a disappointing autumn for the economic recovery. A consumer confidence survey due today is expected to show a rebound from a plunge in October, while new home sales data out yesterday showed a 1.3 per cent rise in annualised sales last month, slightly higher than forecast.Reuse content