U.S. Holiday Season Online Shopping Expected to Grow 7 to 9 Percent
Deloitte, one of the world's four largest accounting firms, released a report on Sept. 19 that said it expects U.S. retail sales for this year's holiday season to grow 2.3 percent to 3.3 percent over last year. Deloitte predicted that consumers are expected to drive between $1.58 trillion and $1.59 trillion in retail sales between November and January. According to the report, e-commerce sales are expected to grow 7 percent to 9 percent year-over-year during the upcoming holiday season, generating $289 billion to $294 billion in online sales. Deloitte's sales growth forecast for this year's holiday season indicates a slowdown compared to last year. The firm predicts that retail sales will grow 3.5% to 4.6% in 2023 from the previous year, pushing holiday retail sales to between $1.54 trillion and $1.56 trillion.
A variety of broader economic factors continue to put pressure on consumer budgets.While inflation has slowed, its lingering effects as well as rising credit card debt and declining savings will likely continue to put pressure on sales growth this quarter, Deloitte economist Akrur Barua said in a statement. The consumer price index rose 2.5% year-over-year in August, according to data released this week by the Bureau of Labor Statistics. Meanwhile, U.S. credit card debt increased by $27 billion in the second quarter to $1.14 trillion, according to the Federal Reserve Bank of New York's Micro economic Data Center.
Echoing Barua's sentiments, other studies suggest that consumers are scaling back their spending this year. Consulting firm Bankrate found in a recent survey that one-third of respondents said they plan to spend less this holiday season than they did last year because of inflation and high interest rates. Fewer than a quarter said they plan to increase spending.In addition to Deloitte's findings, other research suggests that shoppers, especially Gen Z (born 1997-2012) consumers, are using their mobile devices to buy holiday gifts this year. According to a report by Adobe Analytics, more than half (53 percent) of all online shopping during this year's holiday season is expected to occur on mobile devices.Additionally, a recent EMarketer report found that 42 percent of Gen Z shoppers say they are likely to purchase holiday gifts through social media platforms, a higher percentage than Millennials (26 percent), Gen Xers (15 percent) and Baby Boomers (6 percent).Michael Jeschke, principal consultant and head of retail and consumer products at Deloitte Consulting LLP, said in a statement, “Our forecasts indicate that e-commerce sales will remain strong as consumers continue to maximize their spending with online transactions, and while this year's holiday season reflects a level of growth that is return, but retailers that focus on connecting with consumers to build loyalty and trust are likely to be successful.”
In addition, Halloween spending will reach $11.6 billion this year, according to a study by the National Retail Federation (NRF).A survey conducted by the NRF and Prosper Insights and Analytics found that consumers are expected to spend $11.6 billion this year during the Halloween season, down from last year's record $12.2 billion. The survey found that nearly half (47 percent) of respondents began their Halloween shopping before October, up from 37 percent five years ago. Shoppers plan to spend an average of $103.63, slightly lower than last year's record $108.24, according to the survey of nearly 8,000 consumers.More than one-third (37%) of consumers plan to purchase Halloween merchandise at discount stores, followed by Halloween specialty and costume stores (33%) and online (33%). The report projects that shoppers will spend $3.5 billion on candy, $3.8 billion on decorations, $3.8 billion on costumes and $500 million on greeting cards.In the survey, NRF found reasons why shoppers head to stores to complete their Halloween shopping before October. The survey found that while nearly half (48 percent) of shoppers attributed their early Halloween shopping to an overwhelming desire to spend money, 38 percent said they did so to avoid the stress of last-minute shopping.Phil Rist, executive vice president of strategy at Prosper Insights and Analytics, said in a statement, “Interest in early Halloween shopping continues to be dominated by the 25-34 age group, with 56 percent of shoppers in this group starting their shopping before October, and their holiday love is a key factor in this trend, with nearly half of this group sharing that they plan to shop early because Halloween is their favorite holiday.”
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