Consumers kept on shopping in core retail categories in October, especially online.
Nonstore sales, which are mainly online, increased by 10.4% year over year. That’s well above the 8.1% increase for the year to date, according to the October monthly retail sales report from the U.S. Commerce Department. In-store sales, excluding nonstore revenue, grew by only 1.7% in October and 2.1% for the first 10 months of 2023, based on a Digital Commerce 360 analysis of Commerce Department data that excludes sales of vehicles and gasoline as well as spending in restaurants and bars.
Including nonstore sales, October retail sales increased by 3.3% and are up 3.6% for the year. Those figures are not adjusted for inflation or seasonality.
October online retail sales increase
Core retail sales in October grew faster in October than the average for the past six months and well above the 2.5% growth reported in the September retail sales report, says Neil Saunders, managing director and retail analyst at Global Data, a data analytics and consulting firm.
“Growth was helped by a proliferation of deals and promotions, including big events from Amazon, Walmart and Target,” Saunders says. “These also helped the online number, where nonstore sales growth surged to 10.4% — one of the highest rates of growth this year.”
He says consumers may have put off some purchases in September in anticipation of Amazon.com Inc.’s highly touted Big Deals Days Oct. 10-11 and the competing offers by such major retail as Walmart Inc. and Target Corp. Amazon is No. 1 in the 2023 Digital Commerce 360 Top 1000 ranking of North America’s top retailers and brands by online sales. Walmart is No. 2 and Target No. 5.
Will October deals impact Black Friday sales?
“We also suspect that November will be modestly affected by the pulling forward of spend and that the Black Friday occasion itself will be a much more muted affair because of all the early deals which consumers have already taken advantage of,” Saunders says.
Saunders notes that apparel sales decreased by 0.2%, “which was a disappointing result given the extensive amount of discounting during October. Slightly above average temperatures during the month across many parts of the country sapped interest in fall and winter ranges, especially heavy outerwear items. Equally, consumers spending on other things like electronics created more restricted budgets for clothing.”
Sales at electronics retailers increased by 1.4%, aided by heavy promotions and interest in Apple Inc.’s new iPhone.
“Sales at furniture and furnishings stores were down by a sharp 11.6% as consumers retrench and a weak housing market, with far fewer people moving, continues to suck demand out of the category,” Saunders says.
Online sales account for the bulk of nonstore sales, which also include purchases at vending machines, by mail and phone and door-to-door sales.
The U.S. Commerce Department reports overall retail sales, including nonstore sales, every month. It reports retail ecommerce sales quarterly, with the third-quarter ecommerce report due out Friday, Nov. 17.
Overall retail sales, including all categories, declined 0.1% in October compared to September. That’s in large part because of a 1% decline in sales of vehicles and parts and a 0.3% dip in gasoline sales.
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