Young adults most likely to spend more this holiday season
Holiday shopping is in full swing and consumers still have a lot more spending to do as they check off every item on their holiday wish list, according to a new consumer sentiment survey released today by the National Retail Federation and Prosper Insights & Analytics.
“This holiday season retailers will experience the growing purchasing power of Gen Z and millennials,” NRF President and CEO Matthew Shay said. “Whether they are still in college or raising children, these consumer groups embrace the tradition of prior generations and take full advantage of Thanksgiving weekend deals both online and in stores.”
While 77 percent of all consumers surveyed said they would spend the same or more this year, 43 percent of young adults ages 18-24 and 38 percent of those 25-34 said they would spend more. Only 9 percent of those 65 and older are planning to spend more.
“Americans continue to engage in holiday traditions like spending time with family and friends, exchanging gifts and cooking a special meal,” Prosper Executive Vice President of Strategy Phil Rist said. “But today those traditions include going online to research products and compare prices to make informed purchasing decisions.”
The survey found that 50 percent of consumers who own smartphones or tablets said they would use them to research their holiday purchases.
Most Popular Holiday Gifts of 2018
Top gifts continue to be clothing and accessories, expected to be purchased by 59 percent of consumers, gift cards (56 percent), toys (41 percent) and books/music/movies (40 percent).
Spending on gift cards is on the rise and is expected to reach $29.9 billion, up from last year’s estimated $27.6 billion. Holiday shoppers plan to purchase an average of four gift cards worth approximately $49 each. The most popular gift cards include those for restaurants (purchased by 36 percent of buyers), department stores (32 percent), coffee shops (22 percent) and entertainment (17 percent).
For girls, Barbie tops the list of must-have toys for the fourth consecutive year, followed by other dolls and L.O.L. Surprise dolls. Other hot toys for girls include LEGOs, American Girl, Hatchimals and Disney Princess.
For boys, LEGOs are again at the top of the list, followed by cars and trucks and video games. Other top toys for boys include Hot Wheels, Marvel action figures/toys, Paw Patrol, Nerf and gaming systems like the Nintendo Switch, PlayStation and Xbox.
Holiday Payment Methods
Consumer payment methods for purchasing holiday gifts remain consistent with 2017. Credit cards continue to be the most popular form of payment, used by 42 percent of shoppers. Debit cards are a close second, used by 39 percent, while 17 percent of consumers plan to pay with cash and 2 percent will use checks. Forty-four percent of consumers plan to use emerging payment methods. Those methods include PayPal (35 percent), Apple Pay (8 percent), Samsung Pay and Google Wallet (tied at 5 percent) and Venmo (4 percent).
In addition to shopping, seven in 10 holiday shoppers plan to engage in charitable activities including donating money and items to a charity or cause. Of those donating, 78 percent said it would have no effect on their overall holiday spending. Older generations are more likely to donate financially, while younger consumers lean more toward tangible donations.
The survey, which asked 7,516 consumers about holiday shopping plans, was conducted October 29-November 7, 2018, and has a margin of error of plus or minus 1.2 percentage points.