The 2024 holiday shopping season is gearing up to be one for the record books, driven by changing consumer behaviors amid persistent inflation and the ever-evolving retail market dynamics.
According to recent studies, including one by First Insight, it’s clear shoppers are embracing the return to physical stores, with reports indicating a staggering 53% increase in consumers intending to shop exclusively in-store compared to last year. This is paired with a notable 21% decline in those sticking solely to online shopping, highlighting a consumer shift back to the traditional shopping experience. Footwear stands out as the singular category experiencing growth online, with purchase intentions rising by 19%, pointing to specific apparel tastes driving e-commerce sales.
Interestingly, nearly half (around 48%) of all shoppers are implementing hybrid shopping strategies, opting to browse both physical and digital aisles for their holiday purchases. This trend suggests consumers are blending the tactile joy of shopping with the convenience of online options, reflecting new shopping habits formed during recent years.
A noted transformation this season includes consumer attitudes toward timing—many shoppers are choosing to delay their holiday shopping with reports of 44% planning to kick off their gift purchasing right after Thanksgiving during Black Friday and Cyber Monday. These shifts signal consumers are waiting for more lucrative deals or aligning their shopping closer to actual gift-giving needs.
Meanwhile, loyalty programs are making waves this year, with 64% of consumers indicating they are influenced by such benefits. This provides retailers with ample opportunities to cultivate customer retention strategies beyond the holiday season, positioning them for sustained growth.
Greg Petro, CEO of First Insight, remarked, “This year’s holiday season highlights a return to the essentials—competitive pricing and convenience,” stressing the necessity for retailers to adapt. Shoppers' inclination toward premium services, such as expedited shipping, is apparent with 36% indicating they're willing to spend over $20 on delivery charges, particularly among Gen Z (25%) and male consumers (23%).
While social media's role as a shopping inspiration has diminished by 20%, affluent buyers maintain significant engagement with these platforms. Notably, two-thirds of shoppers with substantial incomes above $250,000 plan purchases via social media, favoring platforms such as Facebook and YouTube.
Nonetheless, there’s concern as holiday budgets tighten; one-third of consumers intend to reduce their holiday spending this year. Traditional heavyweights like gift cards, big-box retailers, and online marketplaces are estimated to observe declines, with significant price-sensitive behaviors likely signaling broader economic unease.
The holiday weekend spanning from Black Friday to Cyber Monday is projected to see record-breaking retail sales, with estimates hitting $75 billion, marking a 5% growth compared to the previous year. This weekend alone may account for about 8% of total holiday sales—the biggest share since 2019—indicating shoppers are eager and prepared to see what bargains await.
Historical consumer behavior showcases shoppers waiting for those much-anticipated discounts, especially during key shopping events. R.J. Hottovy, head of analytical research at Placer.ai, noted, “People are willing to spend around large holidays and events, but typically much closer to the holiday.”
Even with inflation pinching wallets, experts anticipate substantial spending during peak sale days as consumers are lured by attractive deals. Digital platforms are expected to play key roles, as last year saw more than half of U.S. households making at least one online purchase during Thanksgiving weekend, fostering expectations for repeat performances this year.
With Cyber Monday quickly approaching—which has transformed from a mere post-Thanksgiving assembly of deals to widely recognized shopping events—many consumers are eager to take advantage of online savings. Data from Adobe Analytics suggests substantial increases, with discounts expected to peak on Cyber Monday at around 30%, particularly for electronic goods.
Retailers like Amazon and Walmart are already preparing for these influxes, with Amazon's Black Friday Week starting on November 21 and extending beyond Cyber Monday, showcasing deals across multiple days to meet the demands of eager online shoppers.
Walmart's aggressive push also mirrors this approach, with sales events kicking off early to attract price-conscious consumers. Price cuts on household essentials and necessity items may see shoppers reverting back to these basics, reflecting broader economic sentiments.
Erica Sandberg, a personal finance expert, highlighted consumer nerves as persistent inflation constricts discretionary spending, shifting focuses more toward essentials rather than luxury purchases.
Analysts remain optimistic about shoppers' prospects—good economic conditions, including improved consumer confidence post-elections and advice surrounding holiday budgets, could influence how they navigate this year's shopping extravaganza. “The perception of saving” becomes key, with hopeful anticipation for crowded stores and busy online carts forming once more.
With shifting behaviors and increased demand for flexible shopping options through either online platforms or traditional retail, the season promises rich opportunities for retailers willing to innovate and respond dynamically.
Experts suggest staying informed about specific sales events as Black Friday and Cyber Monday continue to blur lines with consumers shopping across both landscapes. Understanding the nuances of current market conditions will inform purchasing decisions and save customers significant budgets during this pivotal shopping season.
