Home > Insights > Press Releases > October Promotions Did Little to Boost Retail Sales as Consumers Focus on Value, Reports Circana
CHICAGO, November 14, 2023 – In October 2023, U.S. retail sales revenue, including both discretionary general merchandise and consumer packaged goods (CPG), declined 1% compared to the same month last year, and unit sales declined 2%. Discretionary general merchandise spending declines continued with 7% declines in both dollar and unit sales compared to last October. CPG spending gains slowed slightly from last month, with 1% growth in food and beverage and non-edible revenue compared to last year. Demand levels have also waned, with unit sales falling 2% and 4%, respectively, in edible and non-edible segments, according to Circana, formerly IRI and The NPD Group.
Weekly sales results through the month of October reveal that, despite the wave of promotional spending activity, consumer priorities are overshadowing promotions. The influence of the two-week fall promotional period has diminished. This year’s promotions provided a greater week-over-week sales revenue lift than last year, but unit sales of discretionary general merchandise fell 7% year over year.
“The consumer desire that endured through rising prices is now falling prey to it, and the consumer’s focus has turned toward needs,” said Marshal Cohen, chief retail industry advisor for Circana. “With this needs-based mindset, consumers are now showing they’re not as focused on cutting back on how much they buy, but rather how much they spend on what they buy, and the value they are getting.”
Pricing plays a complex role in the consumer’s purchase decisions right now. Higher-priced products have had greater declines than their lower-priced counterparts across industries like dining, softlines, technology, and small appliances. However, little luxuries like prestige beauty products, premium chocolate, and luxury beer continue to grow and win with consumers. Overall value for the price and special sale price both grew as top factors that will influence where consumers will shop for gifts this year, identified by more than 40% of holiday shoppers in a recent holiday purchase intentions consumer survey from Circana.
“The quest for value is not just about getting the lowest price – there is no universal answer in the consumer value equation,” added Cohen. “As this consumer trend carries through Black Friday and the remainder of the holiday shopping season, it will be critical for marketers to turn their attention to finding the right value fit for their product and their consumers.”
