Consumers prepare for holiday spending; 37% plan to spend less than $100

With the 2023 holiday season approaching, year-over-year spending is expected to be higher, but consumers are still making changes to their budgets in an effort to save.

Thirty-seven percent of consumers (a 3% decrease compared to 2022) are maintaining their usual spending habits, but 28% reported having to cut spending to be able to buy groceries, according to a study by cloud marketing firm Zeta Global. Based on a 2,000 U.S. consumer survey, the report details  consumers' gifting choices, budgets and preferred holiday shopping destinations. Over a third (35%) of those surveyed reported being unable to spend on items beyond daily necessities.

When asked how much they are planning to spend this holiday season, 37% of consumers said less than $100, 28% said between $100-500, 35% said between $500-1,000 and 28% said over $1,000.

When choosing one retailer over another this holiday season, price is the greatest determining factor, with 34% saying so, compared to 28% who reported price last year. The same number of respondents (14%) said that coupons or discounts and greater selection & availability were the biggest determining factors.

With a large number of consumers hesitant or unable to spend extra this holiday season, shopping holidays will be important for retailers. Consumers who said that Black Friday and Cyber Monday sales were “compelling” rose to 54% this year, an increase of 2% compared to 2022.

“Last year, 52% of consumers claimed Black Friday wasn’t compelling,” said Zeta Global in the guid. “In reality, Black Friday generated $9.12 billion in sales, breaking its all-time record. While people may not be lining up at stores at 3:00am the day after Thanksgiving, the holiday is still a massive pull for consumers.”

Traditional gifts are reigning supreme this year, with 42% of consumers planning to buy toys, electronics and clothes as gifts. More than a third (34%) of respondents plan to buy family and friends “non-traditional” gifts such as gas cards and grocery gift cards, while 24% will gift experiences like travel, concert tickets, etc.

“Those who plan to give unconventional or experiential gifts skew more female and fall into lower income brackets,” said Zeta Global. “This tracks, because we found that Gen Z and Millennials typically prefer these types of gifts and make less money than older demographics. Conversely, more classic gift givers tend to skew older and have deeper pockets, likely because older generations err on the side of tradition."