The National Retail Federation’s recent report highlighted a notable trend among consumers in July, with value-seeking shoppers significantly impacting retail sales. As the back-to-school season kicked off earlier than usual, many consumers demonstrated a willingness to spend on essential items when they perceived good value, despite ongoing economic uncertainty.
Matthew Shay, NRF President and CEO, noted that this cautious spending reflects broader economic sentiments. “While consumers remain cautious, they still prioritize essentials when they find value,” he stated. This behavior coincided with a 0.95% increase in core retail sales in July, excluding categories such as gasoline, cars, and restaurants.
Grocery sales saw a modest rise of 0.6% from the previous month, along with a 0.47% year-on-year increase, showcasing a careful yet steady consumer approach. However, other retail sectors faced declines, with health and personal care stores experiencing a drop of 0.5%. Yet, general merchandise stores thrived with a 1.75% gain over June, largely propelled by heightened back-to-school shopping and significant promotional sales by major retailers like Amazon and Walmart.
This data underscores a pivotal shift in consumer behavior. Retailers who adapt to these evolving preferences and focus on delivering value stand to benefit in this cautious economic landscape.