The MasterCard Advisors SpendingPulse, which tracks holiday spending, said Tuesday that sales in the two months before Christmas increased 0.7 percent, compared to last year. Many analysts had expected holiday sales to grow 3 to 4 percent.
Shay said the last time the numbers were as low as the SpendingPulse data is suggesting was 2008 during the financial crisis. The NRF executive doesn't expect to see numbers like that again this year. He also said that the MasterCard survey is limited and doesn't cover online sales.
The last week of the year could be critical for retailers. Shay said the holiday season started off strongly and if it ends well, sales growth will end up in the 3.5 percent to 4 percent range, especially with the push from online sales.
Gift cards could also give retailers a boost as many consumers who use a gift card often spend more than the face value of the card, Shay noted.
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Despite the continued optimism, Shay acknowledged that consumer confidence had weakened heading into the holidays following super storm Sandy and the ongoing debate about the "fiscal cliff" of tax hikes and spending cuts that could go into effect early next year.
"We've been saying from the beginning this is a cautious and careful consumer, and it wouldn't take much to knock us off this nice progression," of consumer spending, Shay said.