Black Friday spending raises eyebrows over US economy
Holiday shopping kicked off with record online sales and plenty of headlines, but a closer look at the numbers suggests consumers are spending more dollars without buying many more goods. Inflation, tighter budgets, and shifting shopping habits appear to be shaping a season where revenues rise but unit volumes barely budge.
Big totals, thinner volumes
Industry trackers estimate U.S. shoppers spent roughly $6.4 billion online on Thanksgiving Day and $11.8 billion on Black Friday, both record figures and well above last year. Yet separate data show order volumes dipped about 1 percent year over year while average selling prices climbed around 7 percent—implying much of the growth reflects higher prices rather than a surge in enthusiasm.
Because consumer spending makes up about two-thirds of the economy, holiday sales are closely watched as a stress test of household finances. Strong topline totals offer some reassurance, but the underlying math points to a consumer who is stretching dollars carefully rather than splurging.
Confidence vs. caution
Heading into the season, forecasts diverged: some expected record spending, while others warned that cost pressures and financial constraints would dampen activity. Early reads from retailers and analysts echo a split reality.
One retail research firm estimates Black Friday spending grew about 3.1 percent while product volumes rose only around 0.2 percent. The takeaway: shoppers “dug deep,” but remained selective, stuck to budgets, and accepted that “dollars don’t go as far as they used to.” Growth appears concentrated among middle- and higher-income households, rather than broad-based across all consumers.
A White House economic adviser highlighted the weekend as a success, citing roughly double-digit growth online and mid-single-digit gains in stores, and characterized the period as a “blockbuster.” Others caution that rising receipts do not fully offset shakier confidence and the cumulative effect of elevated prices, interest rates, and tighter credit.
AI and BNPL reshape the checkout
Technology is increasingly steering holiday traffic and transaction flow. Estimates suggest AI-driven shopping experiences—recommendations, search, and automated agents—were responsible for several billion dollars of Black Friday sales, alongside a dramatic surge in AI-generated retail traffic compared with last year.
Buy now, pay later (BNPL) continues to be a key catalyst. Spending via BNPL was projected to approach $800 million on Black Friday alone, with total November–December BNPL usage expected to exceed $20 billion, up by double digits year over year. Analysts flag BNPL as the “elephant in the room”: younger shoppers lean on installment plans for discretionary purchases made on mobile, higher earners use BNPL for premium goods, and lower-income households increasingly finance essentials. This mix helps explain why dollar totals hit records even as unit counts slipped.
The implications for retailers are meaningful: if consumers are spending more per item but buying fewer items—and often financing those purchases—profit margins, promotions, and inventory planning become more critical. As one investor put it, this is a classic “higher prices, lower volume” environment, where revenue can rise while marginal buyers feel more pressure.
Store traffic lags as shoppers value-hunt
Even with robust e-commerce results, in-store visits fell roughly 5 percent across Black Friday and Saturday, according to retail foot-traffic data. Shoppers appear less swayed by one-day “doorbuster” adrenaline and more focused on disciplined, value-driven decisions. Prices, tariffs, and tighter budgets pushed many to plan purchases rather than impulse buy, effectively turning Black Friday into a careful cost-benefit calculation.
Not a recession, but not a free-for-all
Retail analysts say the consumer is far from hibernating—spending is growing, and the retail economy is not in recession. Yet the growth is uneven and restrained. Households are deliberate, hunting for deals, and making trade-offs. That dynamic creates winners and losers: muted volume growth and selective purchasing mean not every retailer will share equally in the season’s gains.
On the surface, Black Friday sales rose by a few percentage points, but with average prices up more than that, inflation’s bite is still evident. In short, Americans are spending, but they are buying slightly fewer items and thinking harder about each purchase.
What to watch next
Black Friday is an early signal, not the final score. Retailers and economists will look to the full November–December stretch—and post-holiday returns—to gauge how headwinds are reshaping behavior.
Current projections point to a solid finish: total online holiday spending is expected to rise to roughly $253 billion, up from about $241 billion last year. Broader retail sales across November and December are forecast to top $1 trillion for the first time. One payments network anticipates e-commerce up around 8 percent and in-store sales up about 2 percent, while noting that inflation is likely a bigger driver of growth than actual volume increases compared with last year.
Bottom line: The holiday season is off to a strong but complicated start. Revenues are climbing, propelled by higher prices, AI-aided discovery, and BNPL-fueled flexibility. Yet softer unit volumes, lower foot traffic, and cautious, budget-constrained shoppers suggest the consumer is resilient—but still under pressure. The health of the season will ultimately hinge on whether value-minded households keep opening their wallets through December without leaning too heavily on credit.
