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Americans are cautiously emerging from economic uncertainties during this holiday shopping season.

With two major shopping days approaching—Black Friday and Cyber Monday—U.S. retailers are gearing up for the crucial holiday season, which, for some companies, constitutes up to 50% of annual revenue. However, our recent research suggests that economic uncertainties and recent inflation may temper customers’ holiday spending enthusiasm. As marketing professors, understanding that consumer spending fuels the U.S. economy, we conducted a survey for the second consecutive year, polling over 500 Americans about their holiday shopping intentions. The findings indicate that consumers harbor conflicting sentiments—they are eager for deals and anticipate indulging themselves, yet they feel the pinch of elevated prices.

Cautiously optimistic at the season’s outset… Regarding Black Friday and Cyber Monday, two-thirds of respondents believe that deals will either match or surpass last year’s offerings—an increase from the 56% reported in 2022. This aligns with forecasts from market research firm Adobe Analytics, anticipating record discounts this year. Shoppers also express a willingness to indulge a bit during Black Friday and Cyber Monday. The proportion intending to prioritize shopping for necessities has slightly decreased since 2022, while those planning to purchase luxury items have seen a modest rise. Meanwhile, intentions to spend on significant purchases have remained steady at 15%.

Despite a slight shift toward more expensive purchases, these findings pose a concern for retailers. This is because historically, big-ticket items have ranked among the top three categories for consumer spending during Black Friday and Cyber Monday, and the reported 15% intention to spend on such items is on the lower end.

Similar to 2022, the majority of surveyed consumers—68.2%—plan to primarily shop online. Less than 11% of respondents intend to engage in in-store shopping this Black Friday, potentially resulting in decreased foot traffic for malls.

… but consumer behavior reflects recessionary tendencies Despite a more optimistic economic outlook, our findings indicate that consumers continue to exhibit frugal behaviors reminiscent of times of economic crisis. This year, consumers fatigued by inflation plan to adopt similar spending strategies.

High prices and inflation remain the primary concerns for consumers, with around 90% of respondents stating that these issues will impact their holiday shopping. On average, respondents plan to allocate approximately $665 for gifts this holiday season—a decrease of about $35 from last year and notably less than the National Retail Federation’s 10-year average of $826.

On a positive note, the percentage of individuals intending to spend “slightly less” or “much less” than the previous year has decreased to 24.2% this year—a 10-percentage-point drop from 2022. While nearly 39% of respondents express plans to spend “about the same” amount, factoring in inflation means that, in real terms, they will be spending less.

Simultaneously, consumers appear to be more meticulous in their budget planning than ever before. Respondents shared their intent to implement various strategies to manage spending, such as adhering to strict shopping lists and commencing shopping earlier to distribute their expenditures.

Despite consumers planning to reduce spending this year, a silver lining for retailers is the heightened interest in brand names and costly gifts, which typically boast higher profit margins.

A noteworthy shift from 2022 is the increased belief among customers that retailers will provide “great value.” This suggests that, while consumers seek competitive prices and affordable options, they are not necessarily seeking cheap products.

During times of economic uncertainty, consumers aim to maintain control over their spending. Nearly 50% of our respondents disclosed plans to finance their holiday spending using saved funds, and a comparable percentage intends to use credit cards.

However, the utilization of buy-now, pay-later options remains stagnant at approximately 15%, despite widespread adoption by major retailers. This implies that, although these alternatives are readily accessible, budget-conscious shoppers may be steering clear of them.

In the broader context, our research contributes to a nuanced perspective on this year’s holiday retail season. Trade groups and economic analysts offer conflicting predictions, with some anticipating a return to pre-pandemic holiday spending, while others expect cautious consumer behavior.

Retailers themselves hold varying forecasts for the holiday season. Amazon, exhibiting optimism, has substantially increased its seasonal hiring, whereas FedEx and Target express a more pessimistic outlook.

This divergence aligns with the prevailing economic landscape. Despite a relatively low U.S. unemployment rate of 3.9%, over half of our survey participants expressed concerns about job security, with about one-third indicating “moderate” or “severe” worry. Only 13% reported having no financial concerns.

Given the ongoing economic uncertainty in the U.S., consumers continue to adopt shopping behaviors reminiscent of recessions this holiday season. Consequently, retailers would be wise to prioritize delivering genuine value.



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