US Black Friday sales dip for first time in seven years

Consumers storming Macy's Macy's opened on Thanksgiving for the first time ever in an effort to lure reluctant consumers into its stores

Sales on the year's biggest shopping weekend dipped for the first time in seven years, according to the National Retail Federation.

US consumers spent around $1.7bn less over the holiday weekend, with the average shopper spending $407.02 from Thursday to Sunday.

That's down from $423.55 in 2012.

Retailers blamed stagnant wages and economic uncertainty for keeping wallets shut, as they slashed prices to lure reluctant shoppers.

In total, the National Retail Federation estimates that US shoppers spent around $57.4bn this year, down 2.7% from $59.1bn last year.

Sales on Black Friday itself were down, as retailers opened stores on Thanksgiving Thursday and offered more details earlier in the week to entice shoppers.

According to ShopperTrack, a market research firm, Black Friday foot traffic was down 11% and sales slumped by 13%.

Cyber Monday solution?

Despite the gloomy start to holiday shopping season, the National Retail Federation said it still expected holiday sales to surpass last year's spending.

Cyber Monday on a computer screen Cyber Monday became the biggest US online shopping day of the year in 2011

One beacon of hope for nervous retailers is that US consumers have spent more on online shopping than ever before.

"We expect Cyber Monday to be bigger than ever," said National Retail Federation's Matthew Shay in a statement.

The day, launched in 2005 by online retail association Shop.org, became the biggest US online shopping day in 2011, according to comScore.

But it's not just one day any more: in an effort to lure penny-pinched shoppers, Wal-Mart, the world's largest retailer, declared this entire week "Cyber Week" and said it would offer sales every hour throughout the period.

However, Wal-Mart, Target, and Best Buy have all lowered their holiday shopping forecasts, pointing to declining consumer confidence, high unemployment, and increasing price competition as hurting their bottom lines.

US Black Friday weekend sales (in billions)

Source: National Retail Federation

2005

$27.8

2006

$34.4

2007

$34.6

2008

$41.0

2009

$41.2

2010

$45.0

2011

$52.4

2012

$59.1

2013

$57.4

Global growth

But if US consumers are unwilling to part with their dollars, international brands may take comfort in the increasingly global nature of Black Friday.

According to Borderfree, a company that helps build global online shopping sites for companies like Macy's and J. Crew, US retailers saw online sales to international consumers rise 50% this Black Friday compared to last year.

Shoppers in Russia, South Korea, China, Germany and Sweden were the biggest spenders.

And Borderfree says retailers can expect a "second peak" on Cyber Monday.

By one estimate, shoppers on the UK are expected to shell out £450m, or 16% more this year

More on This Story

US Economy

More Business stories

RSS

BBC Business Live

  1.  
    POUND STRENGTHENS 05:54:
    pound versus dollar

    This chart shows the pound against the dollar over the last month. You can see it dipped to a low of $1.6071 on 10 September. That was after a poll in the Sunday Times showed a lead for the "No" campaign. It is now trading at $1.65. That's a move of 5 cents which is pretty big over two weeks.

     
  2.  
    MARKET UPDATE 05:47: BBC Radio 4

    Asian markets are up nearly 2% overnight BBC business correspondent Linda Yueh, tells Today. The market indications are that the FTSE 100 will open 0.7% higher. That's not exactly a surge but it is a positive reaction.

     
  3.  
    BANK OF ENGLAND 05:42: BBC Radio 4

    Justin Rowlatt is down at the Bank of England for BBC Radio 4's Today programme: He says the lights are on and staff are busy working inside. Although perhaps not quite as frantically as if Scotland was looking on course to vote Yes in the referendum. Bank governor Mark Carney cut short a meeting to fly home overnight. "He may have had a wasted trip," Justin says.

     
  4.  
    POUND STRENGTHENS 05:36:
    Pound dollar

    This chart shows how the pound has faired against the dollar since the polls closed in Scotland on Thursday evening. As you can see it's strengthened from a low of $1.63 to above $1.65, that's the highest level since last September. In currency market terms that's a huge move in a short space of time.

     
  5.  
    05:30: Ben Morris Business Reporter

    The pound has bounded higher overnight in reaction to the Scotland vote. More reaction through the morning. Stay with us.

     
  6.  
    05:30: Matthew West Business Reporter

    Morning folks. It looks like - with 26 of 32 local authorities now having declared the result of their ballots- that the No campaign is on course to win the Scottish independence referendum. We'll bring you all the reaction from the financial markets and the business community as it comes in. As always if you want to get in touch you can email us at bizlivepage@bbc.co.uk or tweet us @bbcbusiness.

     

Features

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.