The West fared better than other regions with sales up the most at 5.1 percent and the smallest drop-off in traffic, though traffic was still down 12.1 percent year over year. The Northeast saw the smallest sales gain and the second-biggest traffic drop-off at nearly 16 percent fewer shoppers hitting the stores this season over last.
Severe weather in significant portions of the country during the first two weekends in December hit retail traffic hard, and further compressing the already shorter-than-normal season for shoppers. While ShopperTrak doesn't keep data for online sales, Martin said he expects the weather pushed consumers online in December.
(Read more: It's not as gloomy as you think for retail)
"Retailers who deliver a seamless customer experience both in the store and across all channels will emerge ahead of the rest," Martin said.
Martin said a retailer like Gap, which meets that criteria, saw both in-store and online sales grow, and those are revenue improvements, regardless of the channel.
While online sales growth gets all the attention, more than 90 percent of all retail purchases are made in a brick-and-mortar stores, according to ShopperTrak.
But the ShopperTrak founder also said the in-store holiday sales are the highest on record and all signs point to online holiday sales hitting all-time highs as well.
"The retail story is not as bad as people think it is."
—By CNBC's Courtney Reagan. Follow her on Twitter @CourtReagan.