Retailers saw improvements in Black Friday spending, according to First Data Corp. and PayPal Inc., which recently reported double-digit increases in spending data compared with the same day in 2009.
"The good news is, consumers are out there using their cards again, and they are using them at the same level as prior to the recession," said Silvio Tavares, the senior vice president and division manager of information services and analytics at First Data, the Atlanta unit of Kohlberg Kravis Roberts & Co.
Aided by aggressive Black Friday marketing campaigns, U.S. same-store sales on the day after Thanksgiving increased 12.3%, from a year earlier, while transaction volume rose 10.1%, according to First Data's SpendTrend report released on Monday. The report tracks consumer spending initiated with credit, signature-debit, PIN-debit and electronic benefits transfer cards.
The average purchase size increased by 1.9%, according to the report.
The retailer segment saw a modest 8.6% increase in dollar-volume growth. The largest increase, 12.6%, came from the general merchandise category, which includes value retailers.
The electronic/appliances category — the only one that experienced a decrease — saw spending decline 6.7% from a year earlier, a sign consumers are waiting for better prices later on.
Many consumers had stopped using their cards, according to TransUnion LLC. The credit bureau reported this week that 8 million more U.S. cardholders had shelved their bank-issued credit cards, bringing to 40% the percentage of creditworthy consumers who did not use their bankcards within the past 12 months
Indeed, the economy "still has some challenges," Tavares said.
For one, the unemployment rate, which is hovering around 10%, is virtually unchanged from a year ago, Tavares added.
"One of the sources of spending is whether you have more jobs, and that hasn't happened," he said, adding that consumers are increasingly saving their money instead of spending it.
Since the recession began three years ago, consumers have pumped $1 trillion into bank deposits, representing 92% of their increase in disposable income during that time, according to a report released Tuesday from Market Rates Insight, a San Anselmo, Calif., business research firm.
Meanwhile, PayPal, which says it processes 16.5% of U.S. e-commerce and 15% of global e-commerce volume, reported a 27% increase in total Black Friday payment volume, suggesting more consumers are shopping online to find better deals and to avoid waiting in long checkout lines. The unit of eBay Inc. in San Jose, Calif., also reported a 310% increase in year-over-year mobile shopping that day.
Neither PayPal nor First Data reported specific spending or transaction totals.
