Wells Fargo stock (NYSE:WFC) rose as it emphasized Amazon (NASDAQ:AMZN), Chewy (NYSE:CHWY), and eBay (NASDAQ:EBAY) as appealing selections for investors in a note expressing cautious confidence in holiday sales.
Analysts at the bank pointed to the steady and strong growth of online sales as proof that online retail prices are higher than expected. Also, category leaders in terms of ease of use and price are likely to continue to gain market share as customers pay more attention to price, even though inflation is rising.
Wells Fargo Stock and Other Analysts
According to the analysis, Chewy (NYSE:CHWY), which has the best prices in its category, and Amazon (NASDAQ:AMZN), which has the best prices and a wide selection and is easy to use, are both well-positioned for the next holiday season and the changing macro environment. We also notice that people are paying more attention to prices, which is usually good for eBay (NASDAQ:EBAY).
The research team found that Amazon had the lowest prices in 14 of the 15 categories they looked at, beating out big stores like Walmart, Target, Best Buy, and Wayfair. The only category in which the internet giant from Seattle did not take the lead was pricing for pet products, where it tied with Chewy. In the surveyed categories, Amazon’s pricing advantage was, on average, 13% larger.
Many of the brands listed above have pushed for discounts across the industry, which has reportedly left consumers on the hook for the money. Adobe Analytics says that Cyber Monday sales broke a record and did much better than Black Friday sales.
Prices for entertainment, travel, food, and transportation have all gone up a lot, but prices for gifts have actually gone down. Seven out of the ten least overpriced things, according to Bankrate, fall into the gift category. Prices for goods like cell phones and televisions have actually decreased over the previous year by double-digit percentages. In addition, prices for computers and other technology have decreased by 3.1% from 2021 levels.
Promotions were also credited by the National Retail Federation with bringing in a record 196.7 million customers over the Black Friday/Cyber Monday shopping weekend. Matthew Shay, CEO, and President of the NRF says that retailers have also made it easy for customers to shop this holiday season.
Retailers, too have offered customers a season of shopping convenience, according to Matthew Shay, president, and CEO of the NRF. “Some people say the opposite, but shoppers have always bought more in stores and online during the long Thanksgiving holiday weekend and on Cyber Monday.” Consumer demand is what fuels growth.
When sales numbers don’t match the expected tightening of budgets that usually happens when inflation goes up, the health of the average American consumer is called into question. As a single piece of information, the Federal Reserve says that the personal savings rate is about the same as it was during the Great Recession.
The third quarter saw a $38 billion increase in credit card debt, according to Wells Fargo, which is the biggest increase in that statistic in 20 years. So, it might not be possible to keep spending the same amount after the holiday shopping season is over. That makes it even more clear why they chose price leaders as the brands they think will do best through the holidays and into 2023.
In light of this, the team predicted that shoppers will focus on value during the next Christmas shopping season. This should be good for online retailers in general and Amazon in particular.
Featured Image: Unsplash @ Sven Piper
Author Jowi Kwasu 
