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How COVID-19 is Impacting Consumer Spending: Holiday Special Coverage

As we approach the holiday season, companies across the retail landscape are in a much different position than they were a year ago. A number of general merchandise industries, particularly those that improve life at home, have experienced double-digit year-over-year sales growth in recent months. Meanwhile, other industries have struggled — players in those spaces will look to the holiday shopping season as an opportunity to reverse course.

We will update this page frequently with sales tracking data, expert analysis, and other resources to help you navigate this year’s holiday shopping season.

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U.S. Consumption Trends by Week

General Merchandise: Dollar Change Versus Year Ago

Compared to last year, U.S. general merchandise dollar sales increased 21% in the week ending October 17.

Source: The NPD Group/Point-of-Sale Early Indicator Report, NPD Universe, WE Oct 17, 2020
Industries Included: Apparel, Footwear, Auto Aftermarket, Watches, Housewares, Small Domestic Appliances, Toys, Video, Sports Accessories, Consumer Technology, Office Supplies, Prestige Beauty, Juvenile Products

Commentary

Dollar sales for the week ending October 17, 2020, which included the much anticipated Prime Days and other retailer Deal Days, came in with impressive +21% growth over last year for preliminary discretionary spending. Unit sales were up single digits that week. This clearly shows a strong disparity between dollars and units, as well as the nature of what was selling. Normally a highly promotional period like this would show big growth in units and less growth in dollars. This year, however, it was more about bigger-ticket items and less about big discounts and secondary categories.

Holiday To Do’s for Brands, Retailers

NPD's chief industry advisor speaks to the increased importance of communication, consumers, price, and product for brands and retailers this holiday season.

Holiday 2020 Perspectives:

Marshal Cohen
Chief Industry Advisor, Retail

"Current limitations on experiences, coupled with consumer hesitation to go out like they did pre-pandemic, will have consumers favoring more tangible gift items this holiday. Experiential gifts, like spa certificates, had grown over the past couple of years, but that trend will be disrupted this year. We’ve already seen this happen over the recent Mother’s and Father’s Day holidays, where popular general merchandise categories saw sales lift for the week that was two and three times what it was in 2019."

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Juli Lennett
Industry Advisor, Toys

“COVID-19 has led to toy sales increases. With no end to the pandemic in sight, toys sales could continue on a growth path. And with limited entertainment options available to consumers that are self-isolating, and if more schools move online (and more parents work from home), they might continue to turn to toys to fulfill their household entertainment needs, which would lead to increased sales. And, as we’ve seen in previous economically challenged times, parents will sometimes forego their own needs to make their children happy.”

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Larissa Jensen
Industry Advisor, Beauty

"In this spirit of self-care and doing something good for ourselves, consumers may be more inclined to self-gift this year - because won’t we all want to congratulate ourselves for making it to 2021? But even beyond the self-gift, self-care related gifts for others are an opportunity as well. Brands and retailers need to make it easier for consumers to decide which beauty products to buy for everyone on their list, including themselves."

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Ben Arnold
Industry Analyst, Consumer Electronics

"Sales of items we need to get through the school or workday took priority in the first half of this year, but as we head into Q4 and the holidays we expect many of these ‘needs’ will have been satisfied and consumers will begin to purchase items they consider to be ‘wants’ or gifts for the holiday season, such as TVs and noise-cancelling headphones.”

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Maria Rugolo
Industry Analyst, Apparel

“Sweatshirts, sweatpants, active bottoms, sleepwear, and socks are forecasted to make up 31% of total U.S. apparel spend this holiday season, compared to 26% in Q4 2019. This is a call to action for the apparel industry to make stronger connections with consumers’ current needs and behavior.”

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Matt Piscatella
Industry Analyst, U.S. Games

“New consoles, more players, increased player engagement, wider variety in titles and services than at any point in the industry’s history, and a shift in spending away from experiences to other segments all give video games strong market tailwinds this holiday. It is not so much a question of whether the U.S. video game market will set a new spending record this holiday, rather the question is how high the new record will be.”

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