Salesforce Report Shows Consumer Spending Dips 5% — Inflation Persists
DUBAI, United Arab Emirates — 15 March 2022 — February shopping data from more than one billion consumers using Salesforce Commerce Cloud globally found that with less purchasing power, U.S. consumers placed fewer orders and purchased fewer items than last year at the same time. As inflation drove higher prices, however, U.S. retailers saw online revenue grow 6% year-over-year (YoY). On the other hand, global online revenue saw a 5% YoY decrease in the same timeframe.
The Salesforce perspective: “Challenges that consumers experienced over the holidays, including inflation and low inventory, haven’t dissipated in the new year,” said Rob Garf, VP and GM of Retail, Salesforce. “While digital commerce continues to prevail, it’s clear that inflation is having an impact on overall consumer spending. With these persistent headwinds, retailers must remove friction and enhance experiences by knitting together offline and online shopping.”
February by the numbers:
- Following a holiday season with modest growth, digital commerce sales in February grew by 6% YoY in the U.S. and decreased by 5% YoY globally.
- February order volume was down 11% YoY and the items per order decreased by 1.3% YoY (3.79 items versus 3.84 items in 2021)
- Prices for consumers in the U.S. rose 11.2% YoY in February while globally prices increased by 4.4% YoY.
- Product inventory in February shrank by -1% in the U.S. and -5% globally as retailers and consumers continued to grapple with supply chain issues.
- Product categories with the highest price growth in February YoY include:
- Home, Furniture (21.8%)
- Home, Appliances (17.9%)
- Home, Dining, Art & Decor (11%)
- Product categories with least price growth in February include:
- Active Footwear (1.3%)
- General Footwear (.8%)
- Electronics and Accessories (.5%)
Zoom out: Retailers and consumers are grappling with higher prices as labor, inventory issues, and last-mile costs drive up the cost of goods. President Joe Biden spent much of his first State of the Union address addressing the issue of inflation and promising to lower costs for American families.
Salesforce Shopping Index Methodology
The Salesforce Shopping Index uncovers the true shopping story through analyzing the activity of more than one billion shoppers across more than 54 countries powered by Commerce Cloud. Several factors are subsequently applied to extrapolate projections and actuals for the broader retail industry.
Salesforce, the global CRM leader, empowers companies of every size and industry to digitally transform and create a 360° view of their customers. For more information about Salesforce (NYSE: CRM), visit: www.salesforce.com.