The holiday season is looking strong according to a new forecast from Deloitte. The group says that holiday retail sales are likely to increase between 7% and 9% in 2021.
Overall, Deloitte’s retail and distribution practice projectd that holiday sales will total $1.28 to $1.3 trillion during the November to January timeframe.
This is compared to 2020. Retail sales between November 2020 and January 2021 (seasonally adjusted and excluding automotive and gasoline) grew 5.8% and totaled $1.19 trillion according to the U.S. Census Bureau.
Deloitte also forecasts that e-commerce sales will grow by 11-15%, year-over-year, during the 2021-2022 holiday season. This will likely result in e-commerce holiday sales reaching between $210 billion and $218 billion this season.
Deloitte is forecasting an 11% to 15% increase in 2021 holiday e-commerce sales compared with the same period in 2020. E-Commerce sales between November 2020 and January 2021 (seasonally adjusted and excluding gasoline stations, motor vehicles and parts dealers, and food services) grew 34.8% totaling $189 billion.
“We anticipate strong consumer spending for the upcoming holiday season. As vaccination rates rise and consumers are more comfortable being outside of the home, we are likely to see increased spending on services, including restaurants and travel, while spending on goods will continue to hold steady. A steady decline in the savings rate to pre-pandemic levels will support consumer spending and keep retail sales elevated this season,” says Daniel Bachman, Deloitte’s U.S. economic forecaster. “Further, e-commerce sales will continue to grow as consumers demonstrate an ongoing and steady movement toward buying online across all categories.”
Bachman notes that the 2021 holiday season increase reflects continued growth. Last year’s holiday sales came in higher than expected, growing by 5.8%. The 2021 forecast projects a strong growth rate amid already elevated retail sales and growth in disposable personal income that is likely to remain flat heading into the season. However, the Delta variant and ongoing uncertainty spurred by the pandemic may drive more spending on goods.
“Across channels, retailers should expect a strong holiday season as consumer spending levels are projected to remain high,” says Rod Sides, U.S. retail and distribution sector leader at Deloitte. “While consumer concerns about health and safety have eased since the last holiday season, pandemic-influenced shopping behaviors continue to gain traction. Retailers who remain resilient to shifting consumer behaviors and offer convenient options for online and in-store shopping, as well as order fulfillment, will be poised for growth this holiday season, and into the new year.”