CHICAGO — The trend of diminishing demand that appeared mid-year continues, revealing shifts in consumer spending behavior that spans retail, according to Circana LLC.
Overall, U.S. retail sales revenue was flat across discretionary general merchandise, retail food and beverage, and non-edible consumer packaged goods during the five weeks ending October 4 compared to the same time in 2024.
Dollar sales gains for the month came from retail food and beverage (up 1%), but unit sales were down across all retail segments, Circana said.
“We are in a period of ‘invisible inflation.’ It appears on the surface as though retail sales have not realized the impact of inflation, but, in reality, consumers are pulling back on the amount of product they are buying, allowing them to spend the same overall amount even though what they are buying costs more,” according to Marshal Cohen, Circana’s chief retail advisor. “Consumers no longer have the same purchasing power they had a year ago.”
Thorvardur de Shong
The latest demand shifts are now evident even at the macro level, and the financial strain on consumers is becoming more evident.
Discretionary general merchandise retail dollar sales declined 3%, and unit demand fell 6%, compared to the same period a year ago.
Retail food and beverage sales revenue was up 1%, and unit sales were down 1%. Non-edible consumer packaged goods dollars were down 1%, while unit sales declined 4%.
“Consumer prioritization means demand and spending shifts will be fickle in their impact, making it important to pay attention to more than just the big retail picture. Successful high-end product launches and promotional timing can alter sales at a product or category level, and create an inconsistent macro view,” says Cohen. “As marketers plan for the upcoming holiday shopping season and 2026, the keys to growth will be to emphasize the relevance of a product, and accelerate innovation – give the consumer a reason to prioritize their spending in your favor.”
