Inflation may have cooled down, but retailers are still facing a holiday season filled with uncertainty. Several factors are at play that will influence consumers’ spending habits this season as they shop for gifts and decorate their homes. From unpredictable weather patterns to the distraction of the upcoming elections and a strong deal-hunting mentality among shoppers, the holiday season is shaping up to be an interesting one.
Despite the challenges, there is reason for optimism among retailers. Shoppers are feeling more positive and are planning to spend more compared to the previous holiday season. According to a survey by Deloitte and the National Retail Federation, holiday spending in November and December is expected to increase by 2.5% to 3.5% compared to the previous year. Shoppers are projected to spend an average of $1,778 on holiday purchases this year, which is an 8% increase from last year.
One of the key trends shaping this holiday season is the strong deal-hunting mentality among consumers. Early holiday deals have already hit the shelves, setting the stage for a season where shoppers are expected to be more focused on finding ways to stretch their budgets. Consumers are increasingly seeking out discounts and deals, with a majority indicating their intention to participate in deals events in October and November.
Another interesting shift in consumer behavior is the focus on experiences and decorations rather than traditional gifts. Consumers are planning to spend more on experiences and non-gift purchases like decor and party apparel, while spending slightly less on gifts compared to the previous year. This change could pose a challenge for retailers who primarily sell goods, but it also presents an opportunity for them to create unique shopping experiences tied to their merchandise.
The upcoming presidential election is also a factor that could influence holiday shopping. Retailers are keeping a close eye on how the election results will impact consumer sentiment and spending. The uncertainty surrounding the election and the potential for a close race between Vice President Kamala Harris and former President Donald Trump could lead to distractions for consumers and impact their shopping behavior.
Additionally, weather patterns play a crucial role in shaping holiday shopping trends. While early fall saw unseasonably warm temperatures and severe hurricanes in some parts of the country, colder temperatures are expected in November and December. Weather conditions can directly impact consumers’ purchasing decisions, with colder weather signaling the start of the holiday season for many shoppers.
Overall, retailers are gearing up for a holiday season filled with challenges and opportunities. By understanding and adapting to the factors influencing consumers’ purchasing decisions, retailers can better position themselves to meet the needs and expectations of holiday shoppers. From offering attractive deals and discounts to creating unique shopping experiences, retailers have the chance to make the most of this holiday season and drive sales despite the uncertainties.
