Why smart CEOs ignored optimistic ‘Record Black Friday’ headlines

Good morning. I’ve been digesting consumer data over the past few days. Mastercard Spending Pulse estimates retail sales rose 4.1%, setting a new record for the biggest shopping day of the year, with online spending easily outpacing in-store shopping and countless headlines trumpeting the Black Friday boom. salesperson found strong online growth in dollar terms and predicted the same trend for Cyber Monday.

But CEOs still have a lot to worry about, especially those of consumer-facing companies. For one thing, spending growth has been driven almost entirely by inflation, rather than shoppers buying more goods. Salesforce, which tracks online spending, found order volumes were down 1% compared with last year, while average selling prices were up 7%. Volumes are also almost unchanged through 2024, so consumer spending has been stagnant for two years.

for another, adobe The study found that consumers’ use of buy now, pay later services – particularly popular with younger consumers – increased 11% on Black Friday compared to last year, indicating that these shoppers are trying to save money. Of course, wealthier people are once again the exception, with a boost from the stock market making them feel wealthy: Salesforce found luxury apparel and accessories were the fastest growing of all categories, up 21%

All of this data suggests that consumers at the lower end of the spectrum, while stretched thin, are willing to spend money on items they believe are worthwhile. In other words, retail spending trends remain somewhat stagnant, echoing what executives are saying about Wall Street in the final two weeks of retail earnings season. Here are some thoughts from top Fortune 500 CEOs on the outlook for the all-important holiday season ahead:

“Customers remain resilient but transaction-focused and attracted by more predictable sales moments.” —best buy CEO Corey Barry

“As discretionary income remains under pressure, our customers are becoming increasingly selective. These customers are becoming more savvy and looking for more value.” –Kohl’s CEO Michael Bender

“They want quality and price. Sentiment is at its lowest point in three years due to concerns about jobs, affordability and tariffs. But they are still driven by emotion.” —Target Chief Commercial Officer Rick Gomez

“There is a constant stream of products that are innovative and novel, and really energizing for consumers. And retailers who combine great prices with a variety of interesting merchandise and modern customer service are still the winners.”Dick’s Sporting Goods CEO Lauren Hobart

“Everything we’ve seen so far makes us optimistic and encouraged that our customers and members are leaning toward seasonal events and the holiday shopping period.” —Walmart Chief Financial Officer John David Rainey

——Phil Wahba

Contact CEO Daily via Diane Brady: dianebrady@fortune.com

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