Holiday Shoppers Push Up Retail Sales

American shoppers opened their wallets this holiday season and helped push retail figures up 5.5 percent over last year, according to MasterCard's SpendingPulse. NPR's Robert Siegel talks with Diane Brady of Bloomberg-BusinessWeek about the figures.

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AUDIE CORNISH, host:

Now to that positive economic news that Larry just mentioned: Holiday retail spending. According to spending polls, which tracks retails sales, Americans spent about $584 billion in the 50 days leading up to Christmas.

ROBERT SIEGEL, host:

That amount is not all in gifts. It does include things like gasoline and food. But it's an increase of 5.5 percent over the same period last year. And that is the biggest gain since 2005.

Online sales saw an even bigger boost this holiday season with a 15.4 percent increase over last year.

Diane Brady is senior editor of "Bloomberg BusinessWeek," and she joins me now. Welcome once again.

Ms. DIANE BRADY (Senior Editor, "Bloomberg BusinessWeek"): Nice to be here.

SIEGEL: And spending overall was up but what exactly were people spending money on?

Ms. BRADY: Well, we were spending a lot of it on clothes, certainly. And I think part of that goes to the self-gifting trend where a good holiday sale should not just be lost on your loved ones. So I think that's a big area of spending. Computers, obviously, brands like Apple continue to gain.

So basically all the things that people wanted under the tree, we were spending money on.

But what's most interesting, I think, is to look at the trends where we're shopping online, because that is both heartening for people and I think troubling for a lot of retailers.

SIEGEL: Well, first, when we hear of an increase that's about 15 percent online purchases, what does that translate to in terms of dollars?

Ms. BRADY: Well, basically online sales now make up about six to seven percent of overall retail sales. So it's still a very small percentage of the pie. But the fact that it's growing so quickly, I think is fascinating because there's a lot of trends behind it.

SIEGEL: Well, let's imagine for a moment that it continues to grow - not too unlikely - and that over the next decade we see continued growth at this rate. What does that mean if we're doing a lot more shopping every year online, as opposed to at brick and mortar outlets?

Ms. BRADY: I think it shows a couple of things. One thing is how hard it is going to be to wean Americans - that is you and me - off our discount sales.

Even myself, I went into Rockefeller Center this week. I pulled out my smartphone. There was a Lego sale. I noticed immediately that it was much cheaper on Amazon. People are going to be doing that more and more, standing in the stores and actually comparing prices.

I think it also is something that may be troubling in terms of job growth, and especially when you look at commercial retail. Basically what's happened in the real estate sector suggests that perhaps this is still a country that is, quote, "over-stored." There are chances we're going to see more store closures, as more Americans feel comfortable just doing a lot of their shopping by computer.

SIEGEL: Because shopping online employs fewer people on the other end and it requires less high-rent commercial retail space.

Ms. BRADY: Exactly. And I think another thing you have to realize is it's a happier experience. When you look at survey after survey, consumers who shop online tend to report higher satisfaction levels. There's no lines, there are really no expectations of service.

And very often now you walk into a store, it's hard to navigate and there aren't a lot of people there to help you. So, you know, we're taking jobs away from the people who used to fold our sweaters for us, and used to check out our goods.

SIEGEL: Diane Brady, senior editor at "Bloomberg BusinessWeek," thanks a lot for talking with us.

Ms. BRADY: Thank you.

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