Consumers Have a More Positive Outlook Leading into 2015 Holiday Season. The majority of consumers plan to maintain their level of holiday spending this year, according to the NPD Group. Also, the National Retail Federation Forecasts Holiday Sales to Increase 3.7%, and online sales will increase between 6 and 8%.
Consumers have a more positive outlook going into this holiday season, according to the 2015 Holiday Purchase Intentions Survey from global information company The NPD Group.
More people, both men and women, agreed with positive statements around giving to those less fortunate, shopping for the holidays, and general holiday anticipation, while fewer survey respondents agreed with negative statements.
ÛÏConsumers are ready to spend for the holidays, more so than in recent years,Û said Marshal Cohen, chief industry analyst, The NPD Group, Inc. ÛÏHowever, manufacturers and retailers need to pay close attention to what is driving the consumer mindset, and deliver product that anticipates inevitable shifts in their thinking over the course of the season. Positive consumer perceptions combined with holiday promotions, could drive early impulse purchases, but the market has to deliver enticing product that consumers want and need in order to build on that momentum and keep them spending.Û
Narrowing the Spending Intentions Gap
While the majority of consumers plan to maintain their level of holiday spending in 2015, a higher percentage plan on spending more this year (15%) compared to last year (12%). At the same time, 16% plan on spending less this year, compared to 20% in 2014. This shows that the gap is narrowing between those who plan on spending less and those who plan on spending more — the closest these two groups have come in the past three years. Going hand-in-hand with this, the mean spend for holiday shopping, based on consumer intentions at the time of this yearÛªs survey, is $619 — a 5% increase compared to what consumers said they planned on doing at the same time in 2014.
Assuming they will be spending less on gas than they were a year ago, more than half of consumers plan to save the additional money or spend it on themselves or others, as opposed to putting it toward bills and other expenses. Among those who plan on spending those freed-up funds, one-third will use it toward necessities for their home, one-third will put it toward travel plans, 22 percent will spend it on gifts for friends or family, and 21 percent will purchase something for themselves.
On-Demand Involvement Is More Important Than Ever Before
Almost two-thirds of consumers say they will enlist pre-purchase research. Online research and consumer reviews both continue to lead the way and grow in importance when it comes to the resources consumers will look to during the holidays. Consumers want quick, easy-to-access information, and real-life input on products from the people using them, not the people selling them.
ÛÏJust as the consumer mindset is one component to holiday success, the holiday season is one leg of the larger retail marathon ÛÒ itÛªs not the finish line,Û added Cohen. ÛÏConsumers are more complex, and marketers have more opportunities to reach them than ever before. Truly connecting with consumers requires interaction and omnipresence, emphasizing a complete experience that extends beyond channels, beyond traditional methods, and beyond the holiday season.Û
The National Retail Federation announced it expects sales in November and December (excluding autos, gas and restaurant sales) to increase a solid 3.7 percent to $630.5 billion ÛÓ significantly higher than the 10-year average of 2.5 percent. Holiday sales in 2015 are expected to represent approximately 19 percent of the retail industryÛªs annual sales of $3.2 trillion. Additionally, NRF is forecasting online sales to increase between 6 and 8 percent to as much as $105 billion.
ÛÏWith several months of solid retail sales behind us, weÛªre heading into the all-important holiday season fully expecting to see healthy growth,Û said NRF President and CEO Matthew Shay. ÛÏHowever, while economic indicators have improved in several areas, Americans remain somewhat torn between their desire and their ability to spend; the fact remains consumers still have the weight of the economy on their minds, further explaining the complex retail spending environment we are seeing right now. We expect families to spend prudently and deliberately, though still less constrained than what we saw even two years ago.Û
ÛÏPotential disruptions from yet another government shutdown in mid-December and a slower pace of job creation and income growth are just a few key factors that will impact holiday shoppersÛª spending this year,Û continued Shay. ÛÏPrice, value and even timing will all play a role in how, when, where and why people shop over the holiday season. Retailers will be competitive not only on price, but on digital initiatives, store hours, product offerings and much more.Û
Holiday sales in 2014 increased 4.1 percent over the previous year
“Similar to last year in the sense weÛªre coming off a rather disappointing first half, this holiday season brings to light several crosscurrents that still exist for American households,Û said NRF Chief Economist Jack Kleinhenz. ÛÏWhile confidence data is encouraging, slower job growth in 2015, deflationary retail prices and the mix of consumer spending somewhat shifting toward big ticket items and services, as well as the wild card in our government spending debates, will all contribute to the slower growth rate of sales expected for the holiday season.Û
ÛÏAll said, thereÛªs no reason to doubt that we will see solid retail sales growth in the final two months of the year,Û continued Kleinhenz.
NRF Forecasts Seasonal Employment to Grow Between 700,000 and 750,000
According to NRF, retailers are expected to hire between 700,000 and 750,000 seasonal workers this holiday season, in line with last yearÛªs 714,000 new holiday positions.
Your SMBs need to strike while the holiday shopping iron is hot! Get them involved in the Shop Small campaign and tie in your campaigns accordingly. In 2014, 23.5% of consumers shopped small, AudienceSCAN reports, and you can help small businesses raise that percentage this year! 15% of Small Business Saturday Shoppers are hunting for new patio furniture. As reflected above, these shoppers are buying for their friends and family, but also splurging on themselves. Get your clothing retailers and spas advertising NOW because those are the categories “Small” shoppers are planning to spend on. 17% intend to get facials or other day spa services, so why not convince them to do so as a break in their day of Small Business Saturday shopping? One more hot-ticket holiday item? A Smart TV device (like Apple TV or Roku) is on 12% of shoppers’ lists!
AudienceSCAN data is available as part of a subscription to AdMall for Agencies. Media companies can access AudienceSCAN data through the Audience Intelligence Reports inåÊAdMall.