We’re smack in the middle of holiday shopping season … in the midst of Hanukkah and 14 days from Christmas.
It remains anyone’s guess as to which way the economic ship will turn, and consumers of late — some say as early as August but definitely by October — have pulled back significantly on mattress and furniture spending.
It wouldn’t be surprising to see a dip in holiday spending from previous years. However, Deloitte Consumer Industry Center dropped its holiday survey results recently and offered up some sparkle for the season.
According to the company’s survey, consumers plan to spend an average of $1,652 on holiday gifts and items. That’s up from $1,496 reported in 2019. In fact, Deloitte said its survey revealed that “consumers are steadfast in their intent to live in the moment and make it memorable.”
The survey polled a national sample of 4,318 consumers between Aug. 30 and Sept. 8, and results indicate that shoppers are spending more like the 2019 holiday season than in the past three years. This year, 95% of consumers — compared with 92% last year and 88% in 2021 — say they will buy during the holiday season, and they have already factored in inflation with expectation to pay more for products than last year.
No surprise here that the upper-income households are more confident in their spending with the $200,000 and up group spending $709 more than they spent last year. Households with between $50,000 and $99,0000 annual incomes have budged to spend $315 more than they did in 2022.
Speaking of the upper-end consumer, those in $200,000 income households will spend on average $3,922 this holiday season. That’s a 22% increase from last year’s spending budget. Consumers in the $100,000 to $199,000 income bracket will spend on average $2,167 during the season. The highest growth will come from those that fall into the $50,000 to $99,000 range with a 26% increase to spend $1,534 on the holidays.
Those high spenders will account for 68% of all holiday spending an,d according to the survey, will likely spend on electronics and — this could bode well for mattresses — health and wellness. The detractors from the home, however, could be that they are three times more likely to spend on experiences, like trips and other outings.
Interestingly, the survey indicates that consumers are placing a priority on non-gift purchases, including furniture, holiday decorations and clothing for themselves.
Deloitte did offer some cautionary words that while shopping trends seem to be balancing out to pre-pandemic levels, consumer savings accounts are slid backward and those college loan payments that had been suspended are now back in the family budget.
Another interesting nugget from the survey shows that consumers are shopping for a shorter time span, dropping from 7.4 weeks pre-COVID to 5.8 weeks this year. The shorter shopping window makes it more important than ever to hone selection, have stock available and make sure it’s priced right.
For all of those brick-and-mortar retailers out there, here’s another bright spot Deloitte pulled from its consumer sample. There’s a renewed preference for shopping in-store as 37% of consumers’ holiday budgets have been allocated to in-store purchases. That surpassed 2019 levels of 36%.
So happy selling during this bright, chaotic time of the year, and here’s to a wonderful holiday season.