Compared to reported sentiments taken before the 2022 holiday season, KPMG’s 2023 holiday shopping outlook predicts a slight pull both on consumers’ budgets (expected to grow just slightly) and dedicated time (expected to inch forward).
Driving this pull, as seen in similar reports, is an ongoing focus on inflation as consumers continue to experience looming financial concerns which they expect to impact how the holiday shopping season ahead will play out. KPMG’s data shows that inflation is consumers’ top concern at 82 percent with shipping delays coming in second at 50 percent.
With inflation in mind, consumers report they will be actively researching more in advance on retailer websites (60 percent up from 52 percent), brand websites (51 percent up from 38 percent) and social media apps and influencers (30 percent up from 20 percent). As they shift spending, consumers said they will be more “value-oriented” with KPMG’s report revealing an expected 78 percent of shoppers will take advantage of Black Friday sales, 49 percent expecting more promotions this year and 29 percent planning to shop the day of Thanksgiving.
Additionally, leading up to the holiday shopping season, consumers told KPMG they will shift behaviors from the year before with planned monthly spending on essentials declining to 11 percent, from 17 percent in 2022. As such, discretionary spending is expected to benefit with an increase of 4 percent in 2023 compared to a decline of 10 percent in 2022 with restaurants, apparel and travel categories expected to come out on top.
“Consumers are becoming experienced value shoppers as they plan for the holiday gift buying season, and to the delight of retailers the resilient consumer will remain as wage gains hold and the door reopens on discretionary spend categories, holiday gatherings and travel,” said Matt Kramer, national sector leader of consumer and retail at KPMG.
During the prime holiday shopping season, consumers told KPMG they plan to spend 5 percent more this holiday season at $1,128 with the average spend per gift recipient experiencing a 4 percent increase and additional increases projected for holiday celebrations and travel. The authors of KPMG’s report said they see only a slight pull forward on the holiday shopping calendar with just over half of survey respondents saying they plan to start before November.
As they shop, consumers continue to report a great affinity toward online shopping (40 percent) compared to in-store shopping (18 percent). Across categories, KPMG reports there will likely be a 12 percent increase in online shopping spend in travel, a 4 percent increase in gift cards and certificates, a 2 percent increase in apparel and a 1 percent rise in personal care products.
Gen Z and Millennials also reported interest in holiday shopping on social media, likely to be prevalent with 38 percent of these young consumers, compared to just 22 percent of Gen X consumers and 11 percent of Baby Boomers. The top categories for social media shopping are expected to be apparel, personal care and entertainment/media.
This story was reported by WWD and originally appeared on WWD.com.
