Deeply concerned by the economy, Americans plan to spend less and shop differently and more carefully during this year’s holiday season, according to Deloitte’s 23rd Annual Holiday Survey of retail spending and trends.
Fifty three percent of the more than 13,000 people surveyed said they expect the economy to weaken next year—the highest in more than ten years of asking this question—compared with 43% last year, according to Deloitte. Also, almost 19% said they feel that their jobs are not very secure or not secure at all, also a record high for the last 10 years, Deloitte reported.
Moreover, 59% of those surveyed said they expect to reduce their spending this holiday season, according to Deloitte. Higher food prices and higher energy prices were the top two reasons for spending less, outpacing the economy and job uncertainty, Deloitte reported.
Categories in which spending is likely to be down the most from last year are home improvements and furnishings, according to Deloitte. Non-gift clothing and socializing away from home also showed marked cutbacks on the survey, while charitable donations and entertaining at home showed smaller declines, Deloitte reported.
Spending on gifts showed the smallest decrease with consumers saying they will spend an average of $532 on gifts this holiday season, a drop of 6.5% from last year, according to Deloitte.
Consumers also said they would buy fewer gifts this year–21.5 gifts on average compared with 23.1 gifts last year, Deloitte reported.
“Retailers face a challenging holiday season,” said Stacy Janiak, Deloitte’s U.S. retail leader, in a statement. “In these difficult times, consumers appear to be reining in their non-essential holiday spending, while trying to preserve the tradition of gift-giving and the spirit of the holidays.”
With economic concerns high, more consumers say they will shop at venues such as discount/value department stores, warehouse clubs, dollar stores, outlet stores, and off-prices stores, according to Deloitte.
Seventy three percent of consumers said the best value for the money will cause them to shop a particular retailer this season, and 72 percent cited low prices, Deloitte reported. Convenient location, quality and selection of merchandise, and customer service / experience all ranked lower, according to Deloitte
Also, 68% of those surveyed said they plan to change the way they shop due to economic concerns, according to Deloitte. Eighty one percent said they will buy more products on sale, 63% said they will buy more lower priced items, 58% said they will limit shopping trips to save on gas, and 57% said they will use more store coupons, according to Deloitte.
Meanwhile, for the fifth straight year, gift cards are expected to be the top gift purchase, Deloitte reported. Almost two-thirds, or 66%, of consumers surveyed plan to buy them, just slightly below last year’s 69%, according to Deloitte.
Holiday shoppers are also planning to buy fewer cards on average: 5.3 cards this year, compared with the 5.5 cards they planned to buy last year, according to Deloitte.
Consumers are also spending less per card: $28.43 per card on average compared with $36.18 last year, Deloitte reported.
Gift cards for gasoline increased to 17% from 13%, another sign of this year’s focus on necessities, Deloitte reported.
Forty seven percent of those surveyed said they have at least one unused gift card, 14% said they have too many gift cards, 14% said it’s unlikely they’ll ever redeem all their cards, according to Deloitte.
