Though shoppers still plan to spend more on the holidays this year than last, consumers say they will restrain their spending this holiday season, according to the National Retail Federation‘s “2007 Holiday Consumer Intentions and Actions Survey,” conducted by BIGresearch.
US consumers plan to spend an average of $816.69 on holiday-related shopping and an additional $106.67 on special “non-gift” purchases – taking advantage of special promotions and discounts to treat themselves.
The total planned holiday-related spending average of $923.36 is an increase of 3.7% from 2006 and in line with NRF’s economic forecast of 4.0% holiday sales growth, projected to reach $474.5 billion.
“Shoppers will be a little more conservative with their spending as they become more aware of the softness in the economy,” said NRF President and CEO Tracy Mullin. “It is safe to say that many retailers will be competing on price, causing this holiday season to be very promotional – a tremendous win for consumers.”
While the traditional kickoff to the holiday season is Black Friday – the day after Thanksgiving – many won’t wait this year: 40.3% of shoppers say they will begin holiday shopping before Halloween.
Though consumers plan to shop at a variety of stores this year, no particular format will see significant traffic gains from last year:
- Discounters can expect the most traffic as 68.4% of consumers plan to shop there (compared with 70.3% in 2006).
- Department Stores will also see a lion’s share of traffic as 58.2% will choose this format (vs. 61.6% last year).
- Other popular destinations include grocery stores (44.6% in 2007 vs. 49.3% in 2006) and online (44.3% in 2007 vs. 47.1% in 2006).
Other findings from the NRF/BIGresearch survey:
- The internet will once again play a crucial role for retailers this holiday season as consumers, on average, plan to do 30.2% of their shopping online compared to 28.9% in 2006.
- As expected, most holiday budgets will be allocated to gifts, with the average person spending $469.14 on family, $90.13 on friends, $22.79 on coworkers, and $37.45 on others, such as clergy, teachers, and babysitters.
- Most Americans plan to increase spending on flowers ($20.53 vs. $18.98 last year) and decorations ($49.76 vs. $46.49 last year).
- Consumers also plan to spend $94.69 on candy and food and $32.21 on greeting cards and postage.
- Consumers’ holiday wish lists are topped with the most practical – gift cards:
- More than half (53.8%) of consumers want to receive a gift card or gift certificate as a holiday gift, though they won’t be the only item on shoppers’ wish lists.
- Consumers also want everything from clothing and accessories (50.1%) to books, CDs, DVDs, videos and video games (50.8%).
- Other popular categories include consumer electronics or computer-related accessories (36.4%), jewelry (23.8%) and home decor or home-related furnishings (22.0%).
- Shoppers choose to buy in stores for a variety of reasons, but two major factors will be driving consumer traffic this holiday season:
- The majority of shoppers continue to say that everyday low prices (12.8%) and sales or price discounts (38.2%) bring them into the stores.
- Other factors like customer service (4.9%), product quality (12.8%), and merchandise selection (22.6%) will help retailers drive traffic.
- Also, 6.3% of shoppers said they choose to shop at stores with the most convenient location.
About the study: The NRF 2007 Holiday Consumer Intentions and Actions Survey was designed to gauge consumer behavior and shopping trends related to the winter holidays. The survey, which polled 7,837 consumers, was conducted for NRF by BIGresearch October 2-9, 2007.