Consumers Open Wallets, Hike Spending 5.5% in Run-up to Christmas

Consumers brought holiday cheer back to merchants and payment processors in the run-up to Christmas this year, spending 5.5% more during the period than they did last year and giving signs that they are opening wallets and purses again after a long recession and rocky recovery. Especially noteworthy were sharp increases in spending in the e-commerce channel and in big-ticket categories like jewelry.

That’s according to MasterCard Advisors, whose SpendingPulse service tracked consumer holiday-season spending from Nov. 5 through Christmas Eve, a 50-day stretch. The service, which includes traffic on the MasterCard payment network as well as survey data capturing spending on cash, checks, and other instruments, released percentage changes but not the raw numbers on which those percentages are based. “If last year’s holiday story was about gaining some stability, this year’s is about getting back to growth,” said Michael McNamara, vice president of research and analysis for SpendingPulse, in a statement.

In an indication that consumers continue to flock online, e-commerce sales jumped 15.4% over last year’s holiday season, the report found. It also revealed an 8.4% increase in jewelry volume, while luxury sales outside the jewelry category rose 6.7%. One big-ticket category that lagged, however, was electronics, which increased just 1.2%. The report says the modest increase may have been due to falling TV prices.

The SpendingPulse report also looked at the apparel category, which racked up an 11.2% gain. The report says the strong performance might have been the result of cold weather and snowy conditions around the country this year.