Consumers are understandably wary about holiday shopping this year in the wake of ongoing economic and public health crisis.
According to PwC’s annual Holiday Outlook, only 55 percent of consumers will spend the same or more this holiday season. And profiles of both consumers who plan to cut back on holiday budgets and those who will continue to spend vary. Among all consumers, Millennials plan to spend the most with an average of $1,367.
Notably, the company found that 50 percent of respondents had been impacted by the pandemic in some way, with nearly 20 percent experiencing reduced income. These changes have impacted consumer behavior throughout the pandemic, and according to PwC, consumers will require trust with retailers as they shop this holiday.
“What we’re seeing is this fleshed out into a lot of different ways consumers are shopping so they’re really rethinking safety and purchasing decisions all throughout the holiday season,” said Allison Stone, assurance senior manager at PwC. “Consumers are still willing to shop in stores — they just want to make sure that there are safety precautions.”
The leading safety measure to ensure comfort shopping in stores was a requirement for all store workers and shoppers to wear a face mask at 59 percent, followed by 45 percent of respondents saying there should be a controlled number of people in stores.
PwC’s survey found 61 percent of consumers will do most of their holiday shopping online this holiday season, though surprisingly plans for mobile shopping has declined. According to Stone, this is likely due to more consumers working at home.
Still, Stone said, consumers are planning to do more targeted shopping when they choose to go to stores. And at the same time, consumers continue to shop trends, including an increase in shopping with independent and local stores. In fact, 46 percent of respondents told PwC they want to shop with local independent stores this holiday season.
While consumers continue to be cautious about travel, with only 27 percent of overall consumers making travel plans this holiday, 54 percent of consumers between the ages of 17 and 38 are ready to travel this season. Of those, 69 percent will travel by car, followed by 33 percent traveling by plane. At the same time, PwC data found that 16 percent of consumers would like to receive the gift of travel this year, compared to only 9 percent last year.
This shift to a decrease in travel has also created a reassessment of consumers’ holiday budgets. “This year, about 60 percent of holiday budget will be spent on gifts,” Stone said. “And 26 percent will be spent on travel, so it was not a small amount of budget going toward travel.”
Young consumers are also planning to spend more on entertainment this season at almost double the rate of older consumers. These young consumers are also leading an increase in use of smartphones, TV, digital streaming devices, game consoles and laptops over the past several months while staying at home with 65 percent of all consumers saying they are in the market for a new tech device.
Overall, categories that are forecast to the most spend this holiday season include grocery, entertainment and home improvement.
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