As we mark a full year of the COVID-19 pandemic, consumer demand in retail is at full force. Shoppers are out for vengeance to “revenge spend” and make up for the past 12 months.Shoppers with disposable income are ready to splurge and this is proven by NRF’s recent forecasts. According to the National Retail Federation, US retail sales will grow between 6.5%-8.2% to more than $4.33 trillion in 2021. As more individuals get vaccinated and businesses reopen, consumers are going to feel more comfortable with shopping in-person.
“Despite the continuing health and economic challenges COVID-19 presents, we are very optimistic that healthy consumer fundamentals, pent-up demand and widespread distribution of the vaccine will generate increased economic growth, retail sales and consumer spending,” said Matthew Shay, NRF President and Chief Executive Officer.
Currently, US retail sales are near record levels and this upward trend will only continue as reopening initiatives take place. Consumer spending over the next two quarters is likely to the be the strongest period in over 70 years, according to Wells Fargo economists.
The prospect of revenge spending has been clear across the world. Industry leaders are confident in the vaccine’s effectiveness and its impact on the US economy, which will translate to accelerated growth for retail. Another key factor is pent-up consumer demand that has become more apparent now than ever before.
“Our principal assumption is that that the vaccination will be effective and permits accelerated growth during the mid-year. The economy is expected to see its fastest growth in over two decades,” said NRF Chief Economist, Jack Kleinhenz.
Source: NRF Retail Forecasts, Bloomberg Revenge Spending
Photo Credit: Bloomberg Revenge Spending
