At least that’s what the National Retail Federation (NRF)’s annual holiday consumer spending survey conducted by BIGinsight reported on Wednesday: the average U.S. holiday shopper will spend $749.51 on gifts, décor, greeting cards and more, up slightly from the $740.57 they actually spent last year. NRF is forecasting holiday sales will increase 4.1% to $586.1 billion.*
“We’ve seen this pattern of cautious optimism all year and despite the challenges that still exist in our economy, it looks as if consumers are eager to celebrate with friends and family,” said NRF President and CEO Matthew Shay. “As the most promotional time of the year, retailers will continue to look for ways to stand out, specifically with attractive deals on toys, electronics and apparel, even well before the ‘official’ start of the holiday shopping season–Black Friday and Cyber Monday.”
Most shoppers say the biggest part of spending will be on family members, $421.82. Others in their lives will see far less spent on them: $75.13 on friends, $23.48 on co-workers and $28.13 on others, such as pets and community members. Consumers will also spend on food and candy ($100.76), greeting cards ($28.66) and flowers ($19.55.) Holiday decorations still plan an integral role with the average person spending $51.99, up from $49.15 last year and the most in the survey’s history. Total spending on holiday décor will reach $6.9 billion.
Economy Now “New Normal”?
In recent years, NRF’s holiday surveys have asked how the economy is influencing consumers’ spending plans. Now accustomed to living on a budget, cutting back on their non-essential purchases, and using coupons and searching for deals, 52.3% of shoppers say the state of the U.S. economy will affect their spending plans, down from 62.2% last year. While recent polls have shown that consumers are focused on the economy as it relates to discretionary spending, the lower percentage is indicative of a consumer that has spent four years changing spending habits, and is better prepared for the uncertain economic outlook in the near future.
“More than half of Americans this holiday season will feel the impact of the economy and will compensate by doing what they’ve been doing for several years–looking for ways to cut any corners, comparative shop online and in stores more often, and even planning to travel less or not at all,” said Shay.
Specifically, three in 10 (31.4%) consumers affected by the economy will comparative shop online more often, 46.4% will shop for sales more often, 23.2% will travel less or not at all, and 6.0% will comparative shop using their mobile devices.
Shopping Early and Online, Too
●As has been the case in the past 10 years, many U.S. consumers, four in 10 (41.4%) say they begin shopping before Halloween. Another four in 10 (39.0%) will begin in November; 16.2% will begin in the first two weeks of December; and 3.5% wait until the last two weeks of December.
●When asked what type of retailers they will shop, nearly two-thirds (65.3%) cited discount stores and more than half (57.8%) named department stores.
●Other retail destinations popular with holiday shoppers: clothing stores (36.2%), electronics stores (31.8%), specialty stores (16.7. %)
●Hitting a new high: more than half (51.8%) plan to shop online for gifts etc. this holiday season. That’s up from 46.7% last year. Moreover, asked what percent of their holiday hopping would be done online: 38.8%, another all-time high. (Shop.org, NRF’s digital division, is forecasting online holiday sales will grow 12 percent to as much as $96 billion.**)
●Despite all this shopping, six in 10 (59.8%) of those polled say they really would like to receive gift cards this year, up from 57.7% last year and the most in the survey’s history.
●Half (49.1%) say they would like clothing, 45.7% said books, CD, DVDs, videos, or video games, and more than one-third (35.8%) are requesting electronics or computer-related accessories.
● Nearly one-quarter (24.0%) want jewelry, the most seen since 2008.
Self-Gifting Reaches All-Time High
As a nod to just how much shoppers enjoy taking advantage of retailers’ holiday promotions to treat themselves to something nice, consumers are expected to spend the most on non-gift items in the survey’s 10-year history. Six in 10 shoppers (59.0%) plan to spend an average of $139.92 on “self-gifting” this holiday season.
Seven in 10 (71.5%) young adults ages 18-24, often the ones seen standing in the long lines for retailers’ midnight and early-bird Black Friday promotions, will spend an average of $159.62–the highest percent of any age group, though not the most amount of money. Adults ages 25 to 34 will spend the most at $175.65.
“It looks like young adults have the ‘one for you two for me’ mentality about the holiday season this year, which is surprising given that this is also the age group that typically doesn’t have the income or ability to splurge,” said BIG insight Consumer Insights Director Pam Goodfellow. “What isn’t surprising is that retailers’ holiday promotions continue to strike a chord with this age group, especially with promotions surrounding popular electronics and apparel items.”
Sales and Discounts Still Drive Holiday Shopping
For some it’s the selection and availability of merchandise, for others it’s a retailer’s no hassle return policy, but for most, it’s the option of sales and discounts that drives their decision to shop with a particular retailer during the holiday season. Asked what the most important factor in deciding where to shop, 36.6% cited sales and discounts, along with 16.1% who say the most important factor is selection of merchandise, and 13.7% who say it’s quality of merchandise.
Mobile shopping will be a big part of consumers’ shopping experience this year, and according to the survey, more than half (52.9%) of those who own smartphones and nearly two-thirds (64.1%) of those who own tablet computers plan to use their devices to research and purchase holiday gifts, décor, food items, and more.
Specifically, 32.9% of smartphone owners will research products and compare prices with their handheld, and another 24.9% will use their phone to look up retailer information, such as store location, hours and directions. Nearly two in 10 (17.6%) will use apps to research or purchase products and 15.0% even plan to purchase items.
Tablet owners are even more likely to use their tablet to aid in their holiday purchases. Four in 10 (44.2%) will research products or compare prices, 19.8% will redeem coupons and more than 27.6% will look up a retailer’s location, store hours, etc. Three in 10 (30.0%) will actually make a purchase with their tablet.
About the Survey
The NRF 2012 Holiday Consumer Spending Survey was designed to gauge consumer behavior and shopping trends related to the winter holidays. The survey polled 8,899 consumers and was conducted for NRF by BIGinsight October 2 to 8. The consumer poll has a margin of error of plus or minus 1.0%. www.nrf.com.
* NRF defines the holiday season as sales in the months of November and December and forecasts holiday sales growth each year based on U.S. Commerce Department data such as previous months retail sales, the housing market, employment and more. NRF’s consumer spending surveys are not a part of the forecast model.
** Shop.org for the first time released an online holiday sales forecast. The online forecast is based on data collected by the U.S. Department of Commerce, the Federal Reserve, the U.S. Census, The Conference Board and NRF’s own calculations. NRF’s spending survey is not a part of the Shop.org forecast.