A record number of online shoppers and an earlier start to the busiest shopping weekend fueled Black Friday sales on Nov. 23, culminating in what is expected to be a blockbuster four-day, post-Thanksgiving shopping weekend.
Mastercard SpendingPulse, an analytics solution for retailers, forecasts indicate overall retail sales could hit $23 billion on Black Friday, a 9% increase over the same popular shopping day in 2017. SpendingPulse expects sales for the entire holiday season — from Nov. 1 through Christmas Eve on Dec. 24 — to grow 5% year over year.
Consumers spent $6.22 billion online on Black Friday, which marks not only a 23.6% year-over-year increase from the $5.03 billion spent on Black Friday in 2017, but also an all-time record for the popular shopping day, according to Adobe Digital Insights.
Adobe attributed the e-commerce growth to the 73% increase in consumers who ordered goods online and picked up in-store on Thanksgiving Day and Black Friday, as well as the fact that online prices on Thanksgiving Day were as low as they were on Black Friday at many retailers. Online sales on Thanksgiving were $3.7 billion, according to Adobe, which marked a 28.0% yearly rise.
This year's Black Friday was also the first to see more than $2 billion in sales made on smartphones, according to the firm. Top-selling items on Black Friday included streaming Devices such as Roku, Chromecast and Amazon.com Inc. Fire TV as well as laptops and video games.
Despite the ongoing consolidation in the beleaguered retail industry— marked by bankruptcies and store closures —Adobe Digital Insights Director Taylor Schreiner said that these strong figures are a sign that retailers are bridging online and brick-and-mortar sales.
"Retailers have done their part to build better mobile experiences for consumers and turning nearly 10% more smartphone visitors into buyers this Black Friday versus last," Schreiner said in a news release.
As for brick-and-mortar, Walmart Inc. said in a news release that "traffic was steady all night long" in its U.S. stores. The big box retailer, which did not provide hard sales data, cited phones, toys, gaming consoles, cookware and televisions as some of the hottest-selling items both in-store and online on Black Friday.
Roughly 41% of 60 East Coast retail properties managed and surveyed by commercial real estate firm Jones Lang LaSalle Inc. opened at 6 a.m. ET, while another 9% of their properties surveyed opened before 5 a.m. ET. All opened before 8 a.m ET.
Of those brick-and-mortar properties, 75% said apparel was the main driver of traffic, while electronics accounted for 25% of traffic.
Rajeev Dhawan, director of the Economic Forecasting Center at Georgia State University's Robinson College of Business, believes that commodity items will continue to bolster online sales.
"In the old days I would have to go to the store but now I can get the same deal online," Dhawan said. "It's not a big surprise that the shopping was done there."
However, Dhawan said that brick-and-mortar sellers need to further train employees in customer service for items like clothing that require fitting and trying on if they want to compete with online apparel sellers that allow customers to try on and return clothes from the comfort of their home.
Planalytics, a weather analytics firm, said that sales of seasonal items such as jackets, gloves, hats and hot drinks thrived due to the coldest Black Friday weekend in more than two decades in New York City and New England.
Strong holiday season expected to continue
Despite the earlier sale starts and evolving e-commerce shopping, Moody's Analytics Director of Real-Time Analytics Ryan Sweet believes the record-setting 2018 Black Friday weekend sales figures are a result of strong underlying consumer fundamentals including increased wages, and strong consumer confidence.
"It's not too surprising," Sweet said in an interview. "The economy is in very good shape. Wages are picking up. We have the sugar high."
Sweet said the U.S. consumer approaches the holiday shopping season in two "sprints," the first coming during Thanksgiving weekend and the second coming from the last-minute shoppers who complete purchases just ahead of Christmas.
Sweet said he would not be surprised if December also fares very well, due in part to projected lowered gas prices over the next several weeks, which would further bolster consumers' wallets.
"The stockings are going to be full," Sweet said. "This holiday season is going to be a very good one."
And the second half of that first sprint appears to be off to a good start.
As of 10 a.m. ET on Nov. 26, online sales made on Cyber Monday topped $531 million, with U.S. e-commerce sales expected to reach $7.8 billion by the end of the day, according to Adobe. Should that daily estimate pan out, it would mark an 18.3% year-over-year increase, making Cyber Monday the biggest online shopping day in U.S. history.
Consumer spending is expected to remain strong during the rest of the holiday shopping season, Moody's noted in a Nov. 26 report.