The holiday season is a time for over-spending, over-consuming, and spoiling family and friends, right? While most Americans are still willing to shell out big bucks on holiday gifts, there is a consumer behavior trend that is slowly but surely gaining momentum. Progressive retailers are taking notice of this trend, so they can prepare to meet the shifting behavior of their customers.
The Downward Trend In Holiday SpendAccording to a recent online poll conducted by CreditCards.com, 53% of respondents plan to spend just $50 on their most expensive holiday gift this year. The National Retail Federation’s annual customer survey found similar data. According to their research, spending on gifts per family is predicted to decline from $621 last year to $608 in 2017.
Given the fact that the job market and the economy are relatively healthy and consumer confidence has been on the rise, it might seem a bit surprising that the trend is predicting downward. Even though people have more money in their pockets, they just aren’t splurging on gifts like they used to.
One of the reasons why is people in the middle and upper class simply have everything they need. Instead of buying their children piles of toys, parents are taking their families on vacation to make memories and share experiences. Couples are going out to dinner or stealing away for a weekend. And many other people are foregoing gifts in favor of charitable gift giving.
Why People Are Abandoning Conspicuous Holiday Consumption
In a recent article on holiday minimalism, one former holiday consumer told The Guardian:“I used to feel obligated to spend money I didn’t have on gifts I didn’t know whether my family needed or wanted. Now, everyone knows my policy is to not buy any gifts, so I no longer feel that obligation, and I enjoy Christmas much more.
This sentiment is being echoed around water coolers and social media all over the globe. People are becoming less enamored with holiday shopping and more enamored with cause giving and creating experiences. And while spending is only predicted to drop less than three percent, that three percent could wreak havoc on retailers’ earnings for the year.
Can Retailers Survive The Holiday Backlash?
So what can retailers do to combat this trend? It is unlikely a store can convince someone who has made up their mind to change their thinking. This means marketers and leaders must get creative and take new approaches to tap into this trend, without losing sales.
Angel trees are a great way to show customers you understand their desire to help others. Some stores partner with local charities to collect wish lists for underprivileged children and teens. Those wish lists are printed on paper angels and hung on a tree inside the store. Shoppers can choose a list, purchase the items, and turn them in.
However, not everyone has time to browse the store for wish list items. Retailers can make it even easier by creating “virtual” angel trees online, where customers purchase an entire list with one click. Or, retailers can pre-package the items in a gift bundle, display them with a price tag and barcode, and shoppers can simply walk the package to the checkout and be on their way.
Opportunities like these allow retailers to support their customer’s desires to move away from consumerism at the holidays while still earning sales.
Do You Have Ideas For Leveraging This Trend?
It is unlikely we will see people completely abandon holiday gift-giving. But over time, the trend to move away from conspicuous consumption towards experiences and cause-driven holiday spend has been growing. It will be important for stores to spend time analyzing holiday shopping data to identify trends and create new experiences in order to hit holiday targets in the future.
What are some of your ideas for making the most of this consumer trend?