Unwrapping the New Shopping Game this Holiday Season
In a world of economic uncertainty where money feels tight for many consumers, retailers are witnessing a shift in shopper behavior. Recently, my team conducted a survey of over a thousand people in the US to better understand how they will approach holiday shopping this year. We discovered that people are getting savvier about how they research purchases and decide to spend their money–especially when it comes to gifts and holiday goodies.
Many shoppers are rethinking their spending habits this holiday season, and it's not just about gifts—it's about the whole holiday experience. For retailers, this shift means understanding how to meet these changing needs.
People are tightening their purse strings this year. About 30% of the surveyed individuals said their holiday shopping budget is smaller this year than last year. Moreover, around 33% plan to buy fewer holiday-themed or seasonal products. It seems like the days of going all out with decorations and themed items might be on the decline this year.
So, what's driving this change? Well, people are looking at the bigger economic picture and taking their personal financial situations into account. Nearly 46% of respondents said they want to save money and be mindful of their finances during the holiday season. The uncertainty in the economy is weighing on the minds of about 39% of the surveyed individuals. Life changes, such as job losses or reduced income, are influencing the spending decisions of 38% of respondents. And let's not forget the impact of inflation on purchasing power—around 31% are feeling the squeeze. Lastly, almost 29% are focusing more on essential expenses and are cutting down on discretionary spending.
While people are tightening their purse strings, they're not giving up on the holiday spirit altogether. People are still planning to buy gifts, but they're being more strategic about it. They're on the lookout for discounts and deals. A whopping 76% said that price is the most important factor influencing their online shopping decisions.
"While the world of spending is shifting, retailers have the power to adapt, offer value, and make this holiday season a win-win for shoppers and their businesses."
When it comes to actually purchasing those holiday gifts, people are getting savvier. A significant 66% of respondents are actively seeking out product discounts this holiday season—more than last year. That's not all—56% are planning to shop in discount stores, and 42% are eyeing specific sales events like Black Friday and Cyber Monday.
But it's not just about the price tag. People are being more thorough in their research before making a purchase. They're checking out product reviews and ratings online (57%), browsing retailer websites and apps (55%), asking friends and family for recommendations (45%), visiting physical stores (41%), and even seeking advice on social media (16%).
Online search engines (64%) and coupon websites or apps (48%) are the go-to sources when finding discounts on products. Additionally, consumers look to store loyalty programs (38%), retailer websites or apps (38%), retailer newsletters (37%), and social media (34%).
What does this all mean for retailers? It's time to adapt and personalize. People are looking for budget-friendly options and the best deals. Retailers can strategize by timing their sales and discounts just right, offering campaigns with personal recommendations, discounts, and providing rewards to loyal customers that help them save.
Retailers can make a big impact in a world where every dollar counts by producing relevant, informative content. Whether through email content and newsletters, ads that match what shoppers are looking for, or engaging social media content, staying connected and providing value can make a real difference.
But even more critical is helping shoppers see what they're buying. Clear, high-quality images matter—88% of consumers say so. By automating product description pages (PDPs) and showcasing products in various angles, 360° spins, and augmented reality, retailers can give customers the confidence they need to make smart purchases, even when finances are tight.
So, while the world of spending is shifting, retailers have the power to adapt, offer value, and make this holiday season a win-win for shoppers and their businesses.