NEW YORK (AP) — Shoppers returned to their familiar holiday shopping patterns this Black Friday after two seasons marked by pandemic concerns and delivery issues but weighed down by inflation.
Because of the increased prices for food, rent, gasoline and other household expenses, many people were reluctant to spend money unless there was a big sale.
Buyers became more selective, opting for cheaper options, saving more and turning to “buy now, pay later” services that enabled installment payments. Some even drained their credit cards at a time when the Federal Reserve was raising interest rates to cool the US economy.
Financial difficulties prompted retailers to negotiate.
Macy’s Herald Square in Manhattan, where discounts include 60% off fashion jewelry and 50% off select shoes, was buzzing early Friday.
Jeff Gennett, CEO of Macy’s, said traffic on Black Friday was “significantly higher” than in the past two years as shoppers become more comfortable with the crowds.
Bestsellers from Macy’s online sale that began late last week included 50% off beauty sets, she said. Last year, Macy’s, like many other stores, had supply chain issues and some gifts didn’t arrive until after Christmas.
“Right now we’re done and ready to go,” he said.
Sophia Rose, 40, a respiratory specialist visiting Manhattan from Albany, New York, went to Macy’s with big plans after sobbing last year while still in school. He put himself on a budget for food and gas to fight inflation, but had already spent $2,000 on holiday gifts and plans to spend a total of $6,000.
She said, I’m going to touch every destination. “That’s the plan.”
This year’s trends are in stark contrast to a year ago, when consumers bought quickly amid supply network disruptions for fear they wouldn’t be able to get what they needed. The stores didn’t have to discount much because they struggled to get the goods.
But some pandemic habits linger. Many retailers who closed stores on Thanksgiving Day and instead posted discounts on their websites to reduce in-store crowds are still sticking to those strategies as normalcy returns.
Major retailers, including Walmart and Target, closed their stores again on Thanksgiving. And many eschewed doorbusters, heavily discounted items offered for a limited time that used to draw crowds. Instead, discounted items are available throughout the month, on Black Friday or during holidays.
Against the current economic backdrop, the National Retail Federation – the largest retail group – expects holiday sales growth to slow to 6% to 8%, down from a sharp 13.5% increase a year ago. However, these figures, including online spending, are not adjusted for inflation, so actual spending may be lower than a year ago.
Adobe Analytics expects online sales to grow 2.5% between Nov. 1 and Dec. 31, slower than the 8.6% rate last year when shoppers were unsure about returning to brick-and-mortar stores.
Isla Dalencia, who this week shopped for household items like laundry detergent at a Walmart in Secaucus, New Jersey, said she puts off buying Christmas gifts until Cyber Monday — the Monday after Thanksgiving — when online sales soar. Accelerates. Then she waits again until the week before Christmas, unlike last year when she started shopping before Black Friday.
“I shop less,” Dalencia said, noting that she will be spending about $700 on Christmas gifts this year, a third less than last year.
Katie Leach, a social worker in Manhattan, also roamed the aisles of Walmart, but said she will begin Christmas shopping as usual in the first week of December. This time, however, she will rely more on bargaining, her credit card and “buy now, pay later” services to get through the shopping season due to rising food prices and other household expenses.
“Not as much money coming in as last year,” Leach said.
Analysts view the five-day Black Friday weekend, which also includes Cyber Monday, as an important barometer of shoppers’ willingness to spend, especially this year. The two-month period between Thanksgiving and Christmas accounts for about 20% of the retail industry’s annual sales.
AP Personal Finance Writer Cora Lewis contributed to this report.
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Anne D’Inocenzio, The Associated Press