Preliminary figures released by Visa’s Consulting and Analytics division indicate that retail activity remained resilient across both physical and digital channels. Analysts highlighted a shift in purchasing behaviour, with many consumers relying on artificial intelligence tools to guide their choices.
E-Commerce Gains Ground as Consumer Habits Evolve
Online shopping played a prominent role in this season’s performance, with digital sales increasing by 7.8% compared to the same period last year. According to Visa, this growth was fuelled by early-season promotions and the convenience of home delivery, although traditional brick-and-mortar outlets still accounted for the majority of transactions, 73% of total retail volume.
Visa’s report, based on a seven-week analysis of its payments network starting from 1 November, excludes categories such as automotive, gasoline and restaurants. The data includes all payment methods, including cash and card, and while it is not adjusted for inflation, the company’s economists estimate that real spending, once inflation is taken into account, rose by 2.2%.
Michael Brown, principal US economist at Visa, noted that the figures reflected a “reasonably healthy” level of spending in the face of economic uncertainty. “It’s certainly not a spectacular season,” Brown said in comments reported by the Associated Press. “It’s sort of an average holiday season given concerns about macro economic growth, inflation. There’s still a lot of uncertainty among the consumer population.”
The broader picture suggests that although shoppers remained cautious, they were willing to spend on targeted categories, especially when aided by tools to stretch their budgets. According to Visa, this was the first holiday season in which roughly half of consumers surveyed said they planned to use artificial intelligence for product discovery or price comparison.
Electronics and Clothing Top Seasonal Sales, Home Improvement Lags
Electronics emerged as the most successful category this holiday season, with a 5.8% year-on-year rise in sales. Visa attributed the increase to strong demand for high-performance devices, particularly those tied to artificial intelligence applications. Clothing and accessories followed closely behind, recording a 5.3% gain as shoppers took advantage of seasonal offers to update their wardrobes.
General merchandise stores, those offering a broad selection of goods in a single location, also benefited from consumer demand for convenience, seeing a 3.7% rise in sales. According to Mastercard, promotional activity during peak periods such as Cyber Week helped sustain momentum into December, allowing retailers to maintain steady footfall.
In contrast, categories linked to the home showed weaker performance. Sales of furniture and home furnishings grew by just 0.8%, while spending on building materials and garden equipment declined by 1%. According to Visa, these figures reflect a shift in consumer focus away from home improvement and towards gift-giving and essential purchases, influenced in part by rising costs on imported goods.
Consumer surveys, including the CNBC All-America Economic Survey, have revealed that 41% of Americans planned to spend less during the holidays, a figure six points higher than the previous year. Yet despite this sentiment, actual spending held firm, underscoring a disconnect between public mood and behaviour at the tills.
