NEW YORK — While consumers remain concerned about the economy, it is not enough to damper their holiday shopping spirit. According to a recent Deloitte survey, while two-thirds (67%) of consumers expect the economy to stay the same or weaken next year, nearly 3-out-of-5 people (59%) will put aside economic worries and spend the same or more this holiday season. This is a slight decline from 2010 but an eight percentage point increase from 2009.
Shoppers planning to spend less this year (42%) point to higher costs impacting their household budgets. Six out of 10 cite higher food prices (63%) and higher gas prices (60% as reasons for spending less this year. Roughly half (49%) point to higher energy costs.
“Lackluster employment growth, debt crises and stock market fluctuations have battered consumer confidence while inflation left many with lighter wallets this fall,” said Alison Paul, vice chairman and U.S. retail & distribution leader for Deloitte LLP. “Consumers will be conservative this holiday season, but remain resilient and maintain a more positive interest in holiday shopping than we witnessed during the recession.”
The survey found that holiday shoppers plan to buy an average of 14.7 holiday gifts this year, down from 16.8 last year and continuing a four-year decline in the number of gifts they plan to purchase.
While all income groups plan to cut back on gift spending, as can be expected, higher-income households earning $100,000 or more annually expect to trim a mere 2% off gift spending to shell out an average of $812 on gifts this holiday season compared with a 26% drop to $291 on gifts among those earning less than $100,000.
Gift cards, which had a long reign as the gift of choice, has been ousted from its top spot by apparel.The number of consumers planning to purchase gift cards fell 11 percentage points to 45%, while clothing went up to 48%. The number who plan to hand out cash slid 7 percentage points to just one-quarter (25%) of respondents, Deloitte found.
The Internet continues to be a powerful tool for comparison shopping, with 68% of consumers planning to change the way they shop to save money, and more than 51% saying they will go online to find better prices. This represents a 10 percentage point jump from last year, while 46% plan to buy more items that qualify for free shipping.
Among shopping destinations, the Internet jumped 13 percentage points to join discount stores at the top of the list with nearly half (48%) of consumers planning to shop these two destinations for holiday gifts. While online interest climbed, discounters slid 10 percentage points from the 2010 survey.
Smartphones will also be an important shopper tool this holiday season, Deloitte found that more than 27% of smartphone owners plan to use their devices for holiday shopping to search for store locations (67%), compare prices (59%) and check product availability (46%). Additionally, 44% say they plan to use social media to seek discounts, read reviews and check family and friends’ gift lists.
Retailers counting on early sales are out of luck as more than half of consumers (53%) plan to begin shopping before Thanksgiving, but nearly three quarters (73%) intend to hold out until after this holiday to make the majority of their purchases.