Now in Retail
Data-driven Insights for Forward-looking Businesses
As the vaccine rollout progresses, consumer needs will continue to evolve. NPD is uniquely positioned to help you understand and react to changes as they happen. As the leading provider of sales tracking data covering stores and e-commerce, we report on what is actually occurring in the marketplace.
We will be updating this page frequently with data, expert analysis, and other resources to help you navigate this uncertain time.
Road to Retail Repositioning
Consumer needs will rapidly shift as the U.S. progresses through the various stages of the reopening period. Brands and retailers must be ready to handle volatile swings in consumer behavior. Click on the boxes below for a look at some of the considerations that will affect retail this year and beyond.
Stages: ■ Completed ■ Current ■ Future
Shifts in Purchasing as Lifestyles begin to Adjust
The New Normal
Stage 1 | Reemergence Begins
In Stage 1, travel will be important to watch as many consumers gear up for trips after a yearlong break. Discretionary general merchandise industries should monitor how this impacts adjacent segments. For instance, declines in the luggage business have softened so far this year compared to much steeper declines throughout late 2020, our Retail Tracking Service data shows. This will accelerate as travel begins to pick up. Additionally, we expect an upward trend in service industries, such as restaurants, as consumers begin to feel safer going out, though it will be a while until pre-pandemic levels are reached.
Key milestones to watch: About 100 M U.S. adults fully vaccinated, decline in work-from-home rate, live events and other gatherings take place with reduced capacity.
Stage 2 | Reemergence Accelerates
This is when to expect more of a return to in-person activities, events, and experiences. We expect consumers will purchase products to facilitate those experiences. Family gatherings and an increased physical presence at work (perhaps with hybrid arrangements and decreased office capacity) will mean many consumers will invest in new wardrobes as they reemerge into the public sphere. The return to commuting will be important to watch. Even a partial return to work will impact the auto aftermarket as auto consumers shift their spend from discretionary DIY items to maintenance-focused items. Additionally, watch for growth in accessories, such as backpacks, and technology, like headphones, that consumers rely on as they commute to and from work.
Key milestones to watch: Approximately 150 M U.S. adults fully vaccinated, further acceleration of workplace return, increases in commutes to/from work.
Stage 3 | Shifts in Purchasing as Lifestyles begin to Adjust
In Stage 3, we expect a stabilization period in the work-from-home, learn from-home, and entertain-from-home landscape. As consumers adjust to a new lifestyle, and reallocate their spending to facilitate in-person experiences, watch for bigger swings in retail performance. Industries that surged in 2020 due to stay-at-home advisories, such as tech and small appliances, may return to a more moderated growth rate compared to pre-pandemic levels. The trajectory for many of the industries that benefited in the stay-at-home environment look bright for the long term.
Key milestones to watch: About 180 M U.S. adults and 10 M kids fully vaccinated, stabilization in work-from-home-rate, larger events begin.
Stage 4 | The New Normal Approaches
In the last stage of the road to retail repositioning, retail sales will normalize. Brands and retailers across industries will need to consider how consumer behavior has been fundamentally altered during the COVID-19 period. Many consumers invested time and money in purchasing and learning to use equipment to facilitate fitness, cooking, working, and entertaining at home. That means many of the industries that thrived in 2020 could remain elevated above pre-pandemic levels. At the same time, industries that struggled last year may find their industries have been changed permanently. Increased remote work may lead to more travel and mobility, and business travel may ramp up, benefiting accessories like luggage and backpacks. The casualization trend that took hold in apparel and footwear last year is likely to remain.
This final stage will offer valuable indicators for how consumer purchasing will evolve throughout the rest of the decade. Brands and retailers must be tuned into the changing dynamics of the consumer spending evolution.
Key milestones to watch: Vaccines readily available, business travel returns.
Total General Merchandise Performance
Compared to last year, weekly U.S. general
merchandise sales increased 6%, our retail
early indicator data shows.
Future Purchase Intent (Discretionary Consumption)
Apparel and footwear rank highest in terms
of future purchase intention, our Omnibus
U.S. Consumption Trends by Week
General Merchandise: Dollar Change Versus Year Ago
Compared to last year, U.S. general merchandise dollar sales increased by 6% in the week ending August 28th, 2021.
Source: The NPD Group/Point-of-Sale Early Indicator Report, NPD Universe, WE August 28th, 2021 Discretionary retail includes the following industries: accessories, apparel, auto parts, beauty, consumer technology, DVD/Blu-ray, footwear, housewares, juvenile products, office supplies, small appliances, sports equipment, toys, video games
The back-to-school shopping season is running its course. While apparel, accessories, footwear, and office supplies continue to post year-over-year gains, their momentum is slowing following the season’s earlier surge. Now we wait to see what this build-up brings in September. Students and parents will identify the next set of needs as they settle into this year’s school routine, and all consumers will respond to developments related to the COVID-19 delta variant as the year progresses.
Across discretionary consumption, apparel and footwear are the top categories consumers plan to purchase in the next 60-90 days.
Source: The NPD Group / May 2021 Omnibus
Thriving in the Four Stages
A Retail Minute with Marshal Cohen – Approaching Stage 2 of Repositioning
As we approach Stage 2 of Retail’s Road to Repositioning, Marshal Cohen emphasizes the importance of understanding the impacts to each business.
How will you drive growth as the retail landscape changes?
Our team is here to help you stay on top of changes in consumer behavior. Contact us for more information.