Visa USA Reports Favorable Consumer Spending On Home Furnishings During the Thanksgiving Weekend

Furniture World Magazine

Visa USA, the world's leading payment brand and largest payment system, announced that consumer spending in electronics, home furnishings, grocery and drug stores helped boost overall sales during the Thanksgiving holiday weekend supporting Visa’s original projection of 7.5 percent growth (including gas and restaurant purchases) in overall retail sales for the 2006 holiday season.* Based on an analysis of spending on Visa-branded credit, debit and prepaid cards, Wayne Best, Senior Vice President of Business and Economic Analysis, identified three major trends and the top performing merchant segments for the 2006 Thanksgiving holiday shopping weekend: Retailers Get Smart on Attracting Shoppers. “Drug/pharmacies and home furnishing stores did surprisingly well over the weekend, which may have been driven by their effort to stock nontraditional items,” Best said. “For example, many grocery stores now are stocking and discounting toys, home improvement stores are carrying flat-panel televisions and drug stores are selling personal entertainment devices. Year over year there was an increase in average ticket and sales transactions at all of these merchant segments.”** Self-Shopping. “Consumers have become much savvier by taking advantage of extended store hours and deeply discounted electronics through the Black Friday weekend,” Best said. “This may indicate that these shoppers are trying to satisfy their own personal wish lists, knowing that discounts on more traditional gift items such as clothing will be available as we get closer to the Christmas holiday.” The Home Furnishing Segment Is Black Friday’s Unexpected Surprise. “With a strong employment market and a large percentage of homeowners cashing out their home equity, there are more dollars in the hands of consumers,” Best said. This, coupled with discounts, boosted spending at furniture and home furnishings stores, making it one of the strongest growth categories, year over year, this past weekend. “Based on the spending we’ve seen thus far, we’re witnessing different trends than we’ve seen in previous years,” Best said. “While consumer spending in the electronic and furniture segments was quite strong, department and discount stores lagged over the weekend. We expect these sectors to improve through the balance of the year, as these stores explore new strategies to attract more consumers.” Purchase Personal Consumption Expenditures (PCE) in the United States amounts to more than $7.2 trillion annually with general-purpose payment cards capturing about a third of that total. Spending on Visa-branded credit, debit and prepaid products represents nearly 17 percent of total Purchase PCE. That means $17 out of every $100 spent by consumers is on a Visa-branded card. (a)Holiday season is defined as November 1st through December 31st. (b)Average ticket is defined as average dollar spend per transaction. About Visa: Visa USA is the nation's leading payment brand and largest payment system, enabling banks to provide their consumers and business customers with a wide variety of payment alternatives tailored to meet their evolving needs. Visa USA is committed to increasing the choice, convenience, acceptance and security of Visa payments for all stakeholders in the payment system — members, cardholders and merchants. Through its 13,369 member financial institutions, more than 500 million Visa-branded cards have been issued to cardholders in the United States. Worldwide, cardholders in more than 150 countries carry more than 1 billion Visa-branded cards, accounting for more than $3 trillion in annual transaction volume. VisaNet, Visa’s global processing system and the world’s largest financial network, processes transactions with unparalleled reliability. Visa offers a trusted, reliable and convenient way to access and mobilize financial resources — anytime, anywhere, anyway.