There is going to be a shopping splurge this holiday season. According to retail analysts, sales in November and December are expected to rise between 7% and 9%, compared to the same period last year. Retailers such as Home Depot and Walmart are hiring more seasonal employees to anticipate this surge in demand. And they were already promoting holiday décor and gifts as early as mid-September.
Based on a new survey we fielded in August 2021, almost three-quarters of consumers plan to host, attend holiday gatherings and dine in at restaurants. Around two-thirds of hosts will gather more often or with more people. Not only do they expect more holiday gatherings, but they also plan to spend more than they did last year.
Seventy percent of people also expect to make special holiday purchases for others. And nearly a quarter plan to spend more on holiday gifts this year, whether on higher-priced items or just more purchases.
In short, people are excited about the upcoming holiday season.
Despite their excitement over holiday spending, consumers feel less certain about the economy, with just about half feeling optimistic about the local economy and only 39% optimistic about the national economy. And most indicated this economic uncertainly was due to concerns about the impact COVID-19 continues to have.
The Conference Board’s index, which tracks U.S. consumer confidence, confirms these findings. The index fell to a seven-month low in September, the third straight month of decrease. Economists attribute the downtrend to the spread of the delta variant, the rising prices of household goods, and the concerns over income prospects.
Therefore it’s no wonder 78% of consumers said they have increased their saving behaviors, with two-thirds focusing more on their basic needs and being more practical in their purchases. Half of consumers look for ways to save more money and a third are on the hunt for coupons and discounts.
According to the National Retail Federation, despite the low consumer confidence and higher budget consciousness, shoppers continue to spend. August retail sales grew by 12% year-on-year, on track to meet its forecast of between 10.5% and 13.5% annual growth.
Despite what consumers say or feel about the economy, they plan to spend, especially for the upcoming holidays. Of course, brands must balance the pent-up demand with the increasing price sensitivity. This is where a solid deals strategy comes in.
Our survey showed that nearly half (46%) of holiday shoppers want deals and discounts as they buy for gift-giving and holiday gatherings. Thirty-nine percent want personalized offers and discounts and the same percentage want to know where to shop to find the best deals within their local community. They expect these not just from retailers but also from restaurants as 37% said they want restaurant deals for those busy holiday shopping and preparation days.
Coupons and discounts are good for business
Thirty-nine percent of the people we surveyed for our 2021 Deals & Coupons Report said they are more likely to make a repeat purchase. Our study also found for 31% of consumers, a coupon or discount enables them to spend more or make larger purchases. Fifty percent said coupons could make them impulse buy, while 59% agreed deals help them decide where to shop or which brand to buy.
That means the investment in coupons and discounts will be more than offset by higher volume and repeat purchases. And you stand to make your audience happy with 40% of people saying they feel more positively toward brands that offer deals and 26% enjoy sharing your deal or recommending your brand to friends and family.
Do you find all these data fascinating? Check out our infographic, “Holiday 2021: Optimism and Spending on the Rise” for a quick visual summary.
Matthew Tilley is senior director of content marketing for Vericast and leads content marketing for the company. He has more than 20 years of experience in digital advertising and consumer promotions to develop, communicate, and distribute ideas to make modern marketers more effective.