Harsh winter weather continued to subdue consumer spending growth in February

 
March 12, 2014

First Data Corp. has released its First Data SpendTrend analysis for Feb. 1, 2014, through Feb. 28, 2014, compared with Feb. 1, 2013, through Feb. 28, 2013. SpendTrend tracks same-store point-of-sale data by credit, signature debit, PIN debit, EBT, closed-loop prepaid cards and checks from nearly four million U.S. merchant locations serviced by First Data.

Dollar volume growth remained positive at 2.4 percent, but marked a slight slowdown vs. January's 2.5 percent growth as severe winter weather lingered into February. Spending growth did gain momentum near the end of the month as temperatures turned warmer and tax refunds increased, especially since refund volumes and values were slightly up versus last year.

Gas station dollar volume growth of -6.6 percent remained a drag on the overall growth and fell significantly compared with January's growth of -0.1 percent as the year-over-year gas price discount widened to the cheapest monthly national average in February since 2011.

Meanwhile, spending growth at hotel, travel and food services and drinking places remained healthy at 5.4 percent, 3.3 percent and 4.7 percent versus January's growth of 5.4 percent, 2.3 percent and 3.3 percent and helped to support the overall growth.

Retail spending growth of -0.3 percent was up from January's growth of -0.9 percent, but remained in the red as back-to-back snowstorms hit the Northeast and storms in the South forced store closures. Most retail sub-categories in February posted negative year-over-year growth.

Stores benefitted from the inclement weather early in the month as consumers sought out more winter supplies, but also saw strong sales at the end of the month as warmer weather spurred home improvement and spring-related sales.

Meanwhile, spending growth at non-store retailers marked the highest growth in a year as consumers shopped from home during severe weather.

Average ticket growth of 0.2 percent in February slipped slightly versus January's growth of 0.4 percent. The growth continued to be depressed by gas stations, which saw average ticket growth fall to -5.6 percent versus January's growth of -0.6 percent.

Meanwhile, retail average ticket growth of 0.1 percent marched up compared with January's growth of -0.4 percent as retailers curtailed aggressive discounting as winter inventories started to clear out and spring goods arrived. Most retail sub-categories saw stronger sequential average ticket growth versus January.

"Consumer spending growth was again unfavorably impacted by severe weather across the nation, which hindered shopping activity for most of the month," said Krish Mantripragada, SVP of information and analytics solutions at First Data. "Credit card spending growth continues to be strong as consumer confidence remains pinned near post-recession highs, which has fueled consumers' appetite for credit and should support more spending growth."


Topics: Consumer Behavior , Payments


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