2017 NOVEMBER | INSIGHTS
The holiday season is upon us!
Here’s what consumers say they will spend money on this year, and where they expect to spend it.
The Synchrony Financial 2017 Holiday Forecast, based on economic indicators and consumer trends, shows that spending during the holiday season is expected to increase between 3.8% and 4.2% over last year. Consumer confidence is at the highest level in almost 17 years (125.9 in October), according to the Conference Board*. These are all good signs for holiday spend. According to our 2017 Holiday Consumer Survey, consumers say they will spend an average of $980 on gift giving this year**.
What spending categories are most popular? Much like your aunt who says she never knows what to buy you, many people apparently feel the same way, and will spend money on gift cards. About 59% of survey respondents said they will plan to buy gift cards for the holidays. This is followed closely by purchases of apparel, at 52%, and toys/games at 48%. And yes, technology will also be a big part of the season again this year. About 35% of consumers said they plan to shop for a “tech-enabled” gift this holiday season. This includes electronics, toys and e-gift cards. And 10% said they will buy tech-enabled clothing this year.
Where people are shopping?
So, where will consumers do their holiday shopping? Not at a mall, according to our survey. Of those shopping in stores, only 38% say they will be shopping at a mall this year. The drivers of this trend are mainly Gen X and Boomers. They are most averse to shopping at malls, as 67% of respondents from both generations said they have no plans to visit the mall this season. Instead, they are more likely to spend money at mass merchandisers (66%) and specialty apparel retailers (50%).
One of the major insights this year: for the first time ever, shoppers reported that more than half of their holiday spend will be online. Fifty-one percent said they will spend online this season, slowly creeping up from 47% in 2015 and 49% last year. We anticipate that this number will increase even more in the years to come. And, mobile will be a big contributor, as 20% of consumers said they plan to make purchases on a mobile device.
When will the shopping happen?
Well, for those of you who wait for the late season crush, you will not be alone. Thirty-seven percent said they will shop on Black Friday or later this year. This is an increase from 30% last year. Only 44% said they would shop earlier this year.
So, to sum up the season, the main holiday gift categories are expected to be gift cards, clothing, toys and electronics, and many of these items will be bought at locations other than malls. And — even though most say they will do their holiday shopping before Black Friday — the percentage who will wait has grown since last year.
As retail’s most important season gets started, Synchrony Financial will continue to track industry developments and report on consumer trends in order to provide value to our retail partners.
For more insights from Synchrony Financial, click here.
* Source: The Conference Board. Consumer Confidence Survey R October 31, 2017. Used with permission from The Conference Board. https://www.conference-board.org/data/consumerconfidence.cfm
** All references to consumers and population refer to the 2017 Holiday Consumer Study unless otherwise noted.
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