Holiday sales rose 3 percent below 3.7 percent gain

Holiday shoppers flocked online during the critical holiday shopping season, but overall sales in November and December were disappointing.

Sales rose 3 percent to about $625.9 billion, according to The National Retail Federation. That's below the forecast for a 3.7 percent gain the group had expected. The shortfall came even as stores aggressively pushed discounts throughout the season.

The disappointing total sales figure underscores challenges for retailers ahead as shoppers continue to shift away from physical stores and research and buy online.

Indeed, online sales, which are included in the figure, rose 9 percent to $105 billion. That's higher than the group's original forecast of 6 percent to 8 percent growth.