The vast majority of U.S. consumers plan to spend at least as much this year on holiday gifts as they did last year and will be turning to stores for holiday gift inspiration, according to results of the 13th Annual Holiday Shopping Survey from Accenture. The study also found a growing trend of “responsible retail,” with shoppers more concerned about the environmental and social impact of their purchases.
The online survey of 1,500 U.S. consumers found that Americans expect to spend $637 on holiday shopping this year, on average, with approximately six in seven respondents planning to spend either the same (57 percent) or more (28 percent) than they did last year. On average, men expect to spend approximately 15 percent more than women — $685 versus $588. Gift cards and clothing/footwear topped the list of planned purchases.
There does appear to be a level of caution among consumers this year, however, as the percentage of those who anticipate spending less rose slightly year on year, from 11 percent to 15 percent. The two leading factors that respondents cited as affecting their holiday shopping spend are rising food bills (cited by 32 percent of respondents) and the desire to limit their credit card debt (31 percent).
Further, the survey results go against the hype surrounding the demise of physical stores, with respondents saying they expect to do half of their holiday shopping this year in a store or mall, on average. Stores play an important role when it comes to inspiring shoppers’ gift ideas. In addition, consumers were significantly more likely to say that, after seeing an item in a store, they would purchase the item in the store rather than searching online for a better price and purchasing online.
“While having a strong online proposition has become table-stakes, physical stores will still play an important role in the future,” said Jill Standish, senior managing director and head of Accenture’s global retail practice. “With consumers planning to do half of their holiday shopping in-store, retailers need to carefully plan their strategy for customer service, including labor, assortment, and allocation of inventory. With creativity and ingenuity around the store footprint, retailers have an opportunity to leverage the surge in holiday foot traffic not only to increase holiday revenues but also to find those special customers who will be the loyal ones they depend on all year.”
Perhaps not surprising, 82 percent of respondents cited lower prices as the top factor that would tempt them to make an in-store purchase, followed by special offers/discounts (77 percent).
“Although monetary offers are a surefire way to lure in customers, retailers need to manage these incentives carefully, as they can take a big chunk of profits if not managed well,” added Lori Zumwinkle, a managing director at Accenture who leads its retail practice in North America. “Retailers should be using data-driven approaches to understand the profitability of such tactics, to ensure visibility of inventory, and to build a granular understanding of the intersection between product, services and the customer as they try to outmaneuver competitors during the holidays. This is especially pertinent for gifts of clothing, given the heightened risk of returns and the associated costs.”
The survey also identified how consumers are beginning to care more about our planet. They want clear labeling that products are made in sustainable or ethical ways, to be shown the origin of materials and ingredients and offered the option of packaging-free products and deliveries.
What’s more, half of the respondents said that, due to the negative environmental impact of fast-shipping options — which includes the use of planes rather than ground transportation, as well as the shipping of multiple items separately rather than together to expedite delivery — they would opt for delivery options with a lower environmental impact, such as slower shipping or in-store pick-up. Consumers are now looking at the carbon footprint of the different delivery options retailers offer.
And it’s not just environmental issues that ‘responsible’ shoppers believe retailers should consider. Retailers have a responsibility to address wider social issues through their business practices and working conditions, and nearly half of the respondents (45 percent) said they are more likely to do their holiday shopping with retailers that do just that.
“We have entered the era of ‘responsible retail,’ where consumers are becoming more environmentally and socially conscious and will increasingly turn to brands that not only talk about responsibility but demonstrate it through their business practices,” Standish said. “Retailers need to design their products and their business around responsible initiatives; those already on this path could have the edge over their competitors this holiday season and beyond.”