The National Retail Federation (NRF) scaled back its forecast for US retail sales for the year, citing sales trends as well as consumer income and spending data.
The NRF now says its forecast is for retail sales to increase between 3.2% and 3.8% for the year. That's down from the firm's February forecast, which projected annual sales would register a gain of 3.7% to 4.2%. Retail sales growth, excluding gasoline and car sales, only reached 3.0% in the first half of the year, according to the US Department of Commerce. Despite low unemployment, surprisingly slow real income growth has dampened consumer spending.
eMarketer's most recent forecast, released in July, projects that US retail sales will rise 3.8% in 2017 to $5.048 trillion. Unlike the NRF, eMarketer includes all DOC retail sectors in its retail forecast, including fast-growing gas stations and motor vehicle-related retailers.
Retail ecommerce sales are growing far more quickly, with growth expected to top 15% in both 2017 and 2018, eMarketer estimates. In 2017, ecommerce is expected to make up 9% of overall retail sales. That proportion will reach 10% for the first time next year.
According to the Department of Commerce, US retail sales grew 4.0% in H1 2017, but a good chunk of that growth was driven by sales from gasoline stations. Gas stations generated 9.9% more sales in H1 2017 than in H1 2016. Excluding those sales, as well as sales from motor vehicle and parts dealers, retail grew a more modest 3.0% in this year's first half.
Ecommerce has been key to growth. eMarketer senior analyst Yory Wurmser, in his holiday spending forecast report, noted that foot traffic to stores has continued to decline, as have in-store transactions and sales, while ecommerce has gained ground.