Retail sales data from the US Department of Commerce for February is out, giving us an important snapshot for what kind of year 2023 is shopping up to be for commerce.
Year-to-date US retail sales are up 5.1% versus the same period in 2022, adjusted for inflation, sales are down 1%. This represents a significant deceleration of growth from 2022, when retail grew at 8.1%. Comparing to before the pandemic, year-to-date retail sales in 2023 are up 37.3% versus the same period in 2019, adjusted for inflation sales are up 15.4%.
Of course, the overall “retail industry” is an average of a wide variety of categories that are performing very differently. Year-to-date US grocery sales are up 4.9% versus the same period in 2022, adjusted for inflation, sales are down 4.2%. Year to Date Grocery Sales in 2023 are up 26% versus the same period in 2019, adjusted for inflation sales are up 1.8%.
This slowdown likely reflects economic headwinds and uncertainty faced by US consumers. Many retailers have reported that they are seeing consumer purchases shift from wants to needs and are increasingly seeing consumers trade down to more value oriented options. With top-line revenue under stress, many retailers are laser focused on controlling costs and improving the bottom line in 2023.
It’s also a particularly interesting year for e-commerce. 2022 was the first year ever that brick and mortar sales grew faster than e-commerce. It will be interesting to see if 2023 reverts to historical trends or if we have a new normal, and what that new normal might look like.
Download the Publicis Commerce Data Compendium for a complete snapshot of all industries interesting data trends here.