December 30, 2009
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News: Mixed Feelings Over Holiday Shopping Results
The Holiday Shopping Season doesn't officially end until December 31st; however, numbers released by the credit card giant network MasterCard indicates that consumers spend 3.6 percent more than last year. The company's Advisors' Spending Pulse report showed that credit card sales were up one percent between November 1st and December 24th from the same period in 2008. Although a small increase, it's encouraging when looking at the 3.6 percent decrease between the 2007 and 2008 Holiday shopping season. Although good news for retailers and lenders, consumers need take heed in monitoring credit card spending so that they don't fall back into the same trap of previous years. It's worth mentioning that a large portion of those sales are attributed to debit card sales as well.
At the beginning of the Holiday shopping season, the National Retail Federation (NRF) released a study that showed the number of consumers who had planned to use their credit cards to pay for gifts dropped by more than 10 percent from the previous year. Credit cardholders who planned to use cash to purchase gifts increased by more than 9 percent. Retailers did a better job at managing inventory during the 2009 shopping season. Many decreased receipts from the previous year to avoid taking steep markdowns. Word on the mall walkway this year was "don't wait for a better price." If you wanted it, you had to grab it when you saw it.
The combined efforts on both credit card companies who lowered card credit limits and consumers who made a concerted effort to reduce debt contributed to a more successful shopping season. Consumers who over extended themselves in previous years have been burden with serious complications in attempts to repay the debt. A Consumer Report also released results of its survey which indicated that six percent of Americans were still carrying debt from the 2008 shopping season. Another sign that consumers have become more practical this year is a decrease of gift card sales and early signs that consumers are returning gifts for every day staples.