Holiday spending reflects continued consumer demand
Consumers plan to spend $997.73 on gifts, holiday items and other non-gift purchases for themselves and their families this year, according to the annual survey released today by the National Retail Federation (NRF) and Prosper Insights & Analytics. Despite the continued supply chain disruption, this is on par with consumer spending last year.
“Every year retailers plan their seasonal inventory, staffing and product promotions well in advance for the busy holiday season,” Matthew Shay, president and CEO for NRF, said. “Consumers are ready to celebrate, and gift-giving is high on the list. The retail industry is working diligently with ports, labor, shippers and transportation providers as well as government officials to overcome supply chain challenges and make sure consumers have access to the gifts they want to give and, just as important, receive.”
This year, 90% of U.S. adults plan to celebrate the upcoming holidays, including Christmas, Hanukkah and Kwanzaa, up from 87% last year.
Similar to last year, consumers are prioritizing gifts for family and friends and purchases related to holiday celebrations such as food or décor. Overall plans for holiday spending remain slightly below the pre-pandemic high of $1,047.83 in 2019, as fewer consumers plan to spend on non-gift purchases for themselves and their families.
While nearly half (47%) of holiday shoppers plan to take advantage of sales or price discounts during the holiday season to make non-gift purchases, they plan to spend an average of $118.41 on these items. In contrast, in 2019, 60% planned to make these types of purchases and expected to spend $162.02. As many continue to work from home, shoppers are also less inclined to purchase gifts for co-workers.
However, consumers are motivated to check items off their lists earlier than ever. Half (49%) of holiday shoppers will start browsing and buying before November, up from 42% in 2020 and the highest in the survey’s history. Among those shopping in October or earlier, 47% say they want to avoid the stress of last-minute shopping and another 36% do not want to miss out on key holiday items.
“Over the last few years, consumers have demonstrated the desire to begin their holiday shopping earlier and earlier,” Phil Rist, executive vice president of strategy for Prosper said. “This year in particular, as retailers promote holiday inventory, they are taking advantage of additional offerings such as free shipping, buy online, pick up in store and even expedited shipping to ensure they receive their gifts on time.”
Supply Chain Challenges Concern Shoppers
The supply chain challenges that have been exacerbated since the beginning of the pandemic are top of mind for consumers. Nearly half (47%) of holiday shoppers are concerned they will have difficulty finding items this year. The top items they are worried about finding are electronics (44%), clothes (40%) and toys (28%).
Still, consumers continue to state a strong preference for online shopping. Over half (57%) plan to purchase holiday items online this year, down from 60% who identified online as a holiday destination in 2020 and in line with pre-pandemic norms.
Other top holiday shopping destinations include department stores (47%), discount stores (44%), grocery stores (43%) and clothing/accessories stores (30%). One-quarter (24%) of consumers plan to shop specifically at a local or small business.
The survey asked 7,921 consumers about winter holiday shopping plans. It was conducted Oct. 1-10 and has a margin of error of plus or minus 1.1 percentage points.