Consumers Are Spending More as They Shop

In each of the 12 months since March 2020, the average amount spent per shopping occasion has been between 13% and 29% higher than the same month in the prior year, according to a survey by the NPD Group. Those new spending levels have held relatively steady since March 2021.

The increase is partially due to a general shift toward online purchasing, where average selling prices and the amount spent on each transaction already tended to be higher, the survey said.

“Fewer shopping trips to limit in-person contact at retail stores, combined with supply-chain challenges making fewer products available, means consumers are more willing to spend more now to get the products they need,” said Marshal Cohen, retail chief industry advisor for NPD. “This dynamic alters the traditional cadence of product seasonality and creates less price sensitivity.”

For the holiday shopping season, Cohen said this likely means consumers will spend more for better products, with fewer items under the tree with impulse shopping still muffled.

Grocery and drug stores, warehouse clubs, hardware and farm stores, and mass merchants have enjoyed the strongest growth in spending per-shopping occasion since the start of the pandemic, across the combined in-store and online retail landscape with each channel averaging at least 20% higher than 2019 levels. according to the survey.

NPD added warehouse clubs, and hardware and farm stores are two channels that experienced an increase in combined in-store and online shopping visits, but their overall gains still pale in comparison to pure-play online retailers which have increased shopping visits 49% compared to 2019.

Of bricks-and-mortar retailers, malls have essentially recovered from the pandemic, Placer.ai said in August.

Outdoor shopping centers posted a 2.1% increase in monthly visits in July as compared to the same period in 2019, while indoor malls narrowed that gap to -0.1%. And month over month visits are also either increasing or remaining steady: foot traffic in outdoor malls grew 20.8% in July from June, while visits to indoor malls went up 10.6%.

“It turns out that malls are much more resilient than many expected, and shoppers’ forced separation from these emblems of American retail seems to have rekindled an old flame,” Placer.ai’s Shira Petrack noted.

Petrack added customers are traveling longer distances to get to their favorite malls than they did at the start of Covid-19: “As customers are willing to drive further if it means visiting a ‘better’ shopping centers, malls will need to step up their offerings if they wish to stay in the game and continue to attract customers who are increasing expecting their malls to provide not just shopping, but also a diverse array of dining options, entertainment choices, and services.”