Synchrony Financial found consumers in its annual holiday shopping season to be more optimistic this year compared to last with some saying they expect to spend more money as well. The financial services firm said as a result, it expects retail sales this season to rise between 3.6 and 4 percent.
And the firm said shoppers are expecting to head out to stores earlier to hunt for bargains.
“Motivated to manage the stress of the season and their budgets, more than half of holiday shoppers [polled] plan to start their gift buying earlier this year to find deals and help spread out spending,” the company said in its report. “Heading into the holidays, 55 percent of survey respondents are merrier about money and report a better household financial situation than last year.”
Moreover, 34 percent of respondents are expecting to dole out more money on gifts this year, which compares to 32 percent last year. Among those expecting to spend more, 45 percent “attribute it to improved personal finances and increasingly longer lists.” But that doesn’t mean they’re undisciplined consumers.
“To make the most of their money, shoppers are seeking out sales (85% percent) and setting a holiday budget (59 percent compared to 53 percent last year),” the researchers said. “Even with favorable finances, the ability to manage their budget with extra holiday expenses is cited as a key concern among survey respondents.”
Bart Schaller, executive vice president and chief marketing officer at Synchrony Financial, said consumer confidence “continues to improve and we see it shaping the season in the form of increased sales. But caution overrides personal optimism, and shoppers tell us they’re carefully planning, pacing and prioritizing their holiday purchases to stay on schedule and on budget.”
And it is a budget process that began well before the season starts, the researchers said, adding that “half of survey respondents report budgeting all year for holiday expenses, and 28 percent purchase presents throughout the year.”
Another financial tactic being used is layaway. Thirty percent of shoppers said they are using this option, which is up from 25 percent last year. As far as the types of gifts being purchased, results were similar to last year’s poll.
“Gift cards, a new smartphone, money and time with family top most adult wish lists,” the report noted. “Depending on age, popular gifts for children range from toys such as Legos and Barbie to smartphones and gaming systems. More than 60 percent of survey participants agree they ‘still splurge’ on holiday shopping.”