11.5% Of US Households Do Not Plan To Buy Holiday Gifts, More Than Twice The Normal

11.5% Of US Households Do Not Plan To Buy Holiday Gifts, More Than Twice The Normal By Marianne Wilson of Chain Store Age Not all consumers will be increasing their holiday spend this year. In fact, some will be spending less.  Supply chain and inflation challenges may dampen seasonal cheer for some consumers, according to a report from Deloitte. The study forecast that, amid waning pandemic anxiety and stabilizing consumer sentiment, holiday spending will average $1,463 per household, up 5% from 2020 —with higher-income shoppers driving nearly all gains. Higher-income households are planning to spend five times that of lower-income households, the study found. Higher-income shoppers expect to spend 15% more than last year (averaging $2,624 per household). But lower-income groups plan to spend 22% less (averaging $536 per household). In addition, the percentage of overall consumers who do not plan to spend at all this season is 11.5%, more than doubling from 2020 (4.9%). Two-thirds of this non-spender group (65%) are from lower-income households compared to 12% from higher-income households. Deloitte noted that some pre-pandemic behaviors are returning, such as experiences including socializing away from home, travel and entertaining at home. Overall spending is expected to increase 15% year-over-year, to $536 per household, accounting for more than one-third of holiday spending. Other highlights from the Deloitte survey are below. * Consumers are more worried about inflation than retailers. More than two-thirds of consumers (68%) expect product prices to increase this holiday season compared to 53% of retail executives. * Seven in 10 consumers (68%) expect higher prices this season compared to five in 10 retail executives. Lower income shoppers expect to spend less based on inflation expectations, according to Deloitte. * Optimism among retail executives is strong, as seven in 10 expect consumers to spend more year over year. However, six in 10 retail executives are worried about receiving their holiday orders in time. * Three out of four consumers (75%) are concerned about stockouts, motivating consumers to begin their shopping earlier this year.  * Overall spending will increase across categories with 45% of households planning to spend the same or more on the holidays. * Spending on gifts is forecast to be $501 per household, an increase of 3% since 2020, while non-gifts purchases will total $426 per household. * Retailers are placing orders with confidence that consumers will be spending, as 33% of retail executives stated that holiday order volumes grew by double digits year-over-year. As pandemic anxieties decrease, the number of consumers who are anxious about shopping in-store during the holiday season fell to 40% versus 51% last year. Consumer spending at nearly all retail subsectors has recovered and is at or above pre-pandemic levels, according to Deloitte. Related findings are below. * The share of in-store spending is expected to rise to 33% in 2021 (up from 28% in 2020), although this is still below the 36% increase seen in 2019.   * Despite some recovery to in-store spending, digital continues to see healthy gains, with online spending expected to rise to $924, up from $892 in 2020. * Retail executives are optimistic about online sales, with 40% expecting double-digit channel growth. * Convenience preferences from the pandemic are sticking as consumers continue to look for simplified shopping citing online (55%) and mass merchants (51%) as top channels, while digital trends including standard delivery (73%), same-day or next-day delivery (47%), BOPIS (buy online, pick up in store) (33%) and curbside pickup (21%) are maintaining popularity. * An increased reliance on social media to research products continues, as 28% plan to leverage social media for their holiday shopping, including to browse products (56%), read reviews or recommendations (53%), and discover promotions (50%). In addition, 52% of consumers leverage influencer-generated content for inspiration while looking for gifts to buy. “Retailers will see strong growth this holiday season, even as supply chain issues, inflation and highly bifurcated spending continue to impact our industry,” said Rod Sides, vice chairman, Deloitte LLP, and U.S. retail, wholesale and distribution leader. “Retailers who remain resilient by offering promotions early, appealing to in-store and online shoppers, and planning their inventories well in advance, are likely to experience not just a robust holiday season, but will be well positioned for continued sales into the new year.” The report is based on a survey of 4,315 consumers conducted online Sept. 7-14, as well as a survey of 30 retail executives across retail categories, 90% of which have annual revenues of $1 billion or more, conducted Sept. 3-16. Tyler Durden Fri, 10/22/2021 - 12:40
http://dlvr.it/SB6B7y