Mastercard SpendingPulse reported December retail sales closed strong in a robust holiday season that saw gains in stores and online while providing direction on trends likely to drive the sector in the year ahead.
Total retailer sales, excluding auto and fuel, gained 6.9% in December versus the month in 2020 and 8.1% versus the pre-coronavirus 2019 month, while e-commerce advanced 13.5% and 60.4% versus December 2020 and 2019. December sales were strong despite more early holiday shopping and retail out of stocks, both arising from widely publicized supply chain challenges.
A number of trends that build on December momentum bear watching in the year ahead, Mastercard noted, including shifts in how consumers are shopping and paying, as well as how retailers are employing innovative means of reaching consumers and providing differentiated experiences for them.
Mastercard identified several trends:
Buying with a Purpose. Consumers are favoring retailers that share their values, creating and delivering products in a sustainable and inclusive way. Across the world, 85% of adults say they’re willing to take personal action to address environmental and sustainability challenges, with 62% saying it’s more important that companies behave in eco-friendly ways.
Commerce E-volution. Retailers and brands spent much of the pandemic shifting or expanding their digital operations, reflected in the SpendingPulse figures. During 2022, retailers will examine different platforms and tactics to reach hyper-connected consumers.
Experiential Retail. Retailers will continue their initiatives to operate their digital and physical stores more cohesively going forward. The trend has bred what Mastercard identified as “phygital” innovation as retailers engage customers digitally and in person by responding to how-I-want it interactions even to the extent of developing a new breed of hybrid operating models.
Consumer Privacy Gets Real. Demand for personalized experience will come with heightened focus on consumer privacy. Retailers will need to find new ways to understand and engage their digital consumers while still assuring them that their data isn’t misused.