The winter holiday shopping season kicks off for millions of Americans on Thanksgiving weekend, and retailers are ready. Brands are lining up promotions in store, online, and for some, their mobile apps, meaning there will be deals aplenty for consumers this year. So how are Americans planning to shop on Thanksgiving, Black Friday and beyond? I asked Prosper Insights & Analytics Consumer Insights Director Pam Goodfellow to take a deeper dive into the trends she’s seeing and share her expectations going into the biggest time of year in retail.
NRF recently released the preliminary results of its Thanksgiving weekend shopping survey. What were your top takeaways from that survey regarding planned shopping on Thanksgiving, Black Friday and the holiday weekend?
I’ve been asked on multiple occasions if the holiday “creep” – retailers’ early promotions and early bird shopping habits among consumers – is pulling consumers away from the shopping extravaganza that is Black Friday (and now Thanksgiving) weekend. As of early November, more than three out of five holiday shoppers (61 percent) were planning to shop that weekend, down a few points from a year ago (65 percent) – so the “creep” may be shifting some of those Black Friday sales earlier. I think it’s important to remember, though, that a lot of retailers have yet to announce their specific deals, promotions and discounts for the weekend, so there’s still plenty of time for shoppers to get excited about shopping that weekend. And, we’ve estimated that about 33 million consumers plan to shop on Thanksgiving Day while 97 million are planning to visit stores and websites on Black Friday – that’s still a lot of shoppers.
For the seventh consecutive year, gift cards came in as the most-requested gift item, according to NRF. The survey also found spending on gift cards is expected to reach an all-time high this holiday season. Why do you think consumers gravitate towards gift cards each year for holiday gifts?
To recipients, gift cards are simply the perfect gift: you never have to exchange them for a new size/color or worry about receiving duplicates (because that’s OK, too!). Of course, gift cards allow recipients to ultimately choose their own gifts, whether they are more practical or more on the extravagant side. And for gift card givers, they are an easy purchase: buyers don’t have to worry about retailers selling out of cards, carrying packages in and out of stores, or wrapping and shipping large packages across the country. Gift cards also make the perfect last-minute gift, with many retailers and websites allowing shoppers to send virtual gift cards to recipients’ email or social media accounts.
Consumers still have feelings of uncertainty with the state of the U.S. economy. But there seems to be some relief coming from prices at the gas pump. Do you think the decrease in gas prices will comfort consumers to spend more on holiday gifts? Or do you see “cautious conservatism” being a factor during the winter holidays like the back-to-school season?
Cautious conservatism and budget-conscious will continue to be major buzzwords among shoppers this holiday season. Although some of the “pain at the pump” has eased for consumers, they are still uncertain about the direction of the economy, the outlook for employment, and uncertainty in Washington, D.C.; these overarching concerns will keep budgets tight this season. Plus, shoppers have done an excellent job honing smart shopping strategies (price comparisons, couponing, sale shopping, etc.) over the years, so they’re still going to be on the lookout for the best possible deals and not spend any money that they don’t have to. And from what I’ve seen already from retailers this holiday season, there will be plenty of deals out there for shoppers to choose from.
Mobile retailing continues to grow, and Shop.org recently found that Americans are now using the Internet more from their mobile devices than their laptops and desktops. What trends do you expect to see over the coming weeks from mobile-using holiday shoppers?
Mobile devices like tablets and smartphones are the new shopping buddies for consumers when they’re at the stores. Expect to see a lot of shoppers scanning barcodes to find the best prices, using QR codes to get more information and product reviews – and I think we’ll see many consumers out and about over Black Friday weekend keeping tabs on retailers’ deals by the hour by checking out retailers’ websites and apps. We’ve definitely entered the era of the “SmartConsumer.”
What other trends are you noticing or looking for based on other Prosper Insights and Analytics holiday surveys?
One of the most interesting trends we’ve been tracking is spending by generation. And while Millennials are the “hot” consumer segment right now, these youngsters will be the smallest spenders this holiday season (planning to spend, on average, $601 on gifts, décor, cards, food, and flowers) compared with Gen X-ers ($847), Boomers ($738), and members of the silent generation ($688). So while Millennials present exciting long-term selling potential for retailers, Gen X-ers and Boomers still represent 67 percent of total planned gift spending this holiday season – and are segments that retailers cannot afford to ignore this year.