FIRST REPORTFacteus Insight Report on Spending and Transactions (FIRST) Gain Insight on Changes in Consumer Spending Transactions
The FIRST Report is a series of weekly reports that will shed light on the impact of the COVID-19 epidemic on the consumer economy in the US. We plan to look at three super categories of the consumer economy: Retail, Entertainment, and Travel. Focusing on both sectors and individual merchants, we will provide insight into how consumers are being impacted and how they are reacting in this unprecedented time. Our intent is to help businesses, governments, and economists have a current, accurate view of the economy during the COVID-19 pandemic so that they can make informed and timely decisions.
Overall spending took a step back in the week ending October 25, declining 6% year on year, down 5 percentage points from the prior week. Both Retail and Entertainment declined from the prior week, while Travel spending improved. The strongest segments were Discount Stores, Wholesale Clubs, and Home Supply Stores. The Video Game segment saw the largest drop, growing only 7% in the week after growing 51% the week prior, driven by tough comparisons with the prior year.
Aggregate Retail sector spending grew 26% the week ending October 25, down from 29% the prior week. Very little change week to week for the major categories of Discount Stores, Wholesale Clubs, and Home Supply Stores, all growing in excess of 37% year over year. Following its Prime Day spike, spending at Amazon came back down to prior levels, growing 60% year over year, and outgrowing Walmart by 52 percentage points.
Spending levels in the aggregate Entertainment segment declined 17% in the week ending October 25, versus a 6% decline the prior week. The biggest drag on the segment was the Video Game category, which grew only 7% vs. 51% the prior week. The steep decline was the result of very tough comparisons with the same week last year, which saw the release of Call of Duty: Modern Warfare. That game title saw $600 million in sales during the first three days post-launch, making it the biggest digital game launch for Activision and the largest digital download ever on the PS4 platform. We expect that Video Game spending will bounce back next week. Spending growth in the Restaurant category was largely unchanged from the prior week.
Spending in the aggregate Travel segment declined 38% year over year, rising one percentage point from the prior week. The Air Travel category saw a decline of 36% year over year, up 12 percentage points from the prior week—its biggest week-to-week improvement since the pandemic began. Spending on Lodging declined 14% year over year, retreating from the 7% decline it saw the prior week.