Survey reveals gap between retail marketers' confidence, consumers' holiday spending plans
Retail marketers are bullish on meeting sales goals this holiday season, although shoppers aren’t as eager to spend.
That’s according to a new survey from cash back shopping platform Rakuten, conducted along with The Harris Poll, which found that 79% of marketers are optimistic they will reach holiday sales objectives. However, the majority (81%) of shoppers do not plan to increase their holiday spend this year, and 45% of shoppers say they plan to spend less this year compared to previous seasons.
"There's a clear disconnect between marketer perception and consumer realities, but this presents a unique opportunity for retailers to capitalize on the shortcomings of their competition," said Julie Van Ullen, chief revenue officer at Rakuten Rewards. "As shoppers plan to spend less overall, there become fewer opportunities for retailers. This makes it evermore important for retailers to invest in strategies that set them apart throughout the entire holiday season.”
[READ MORE: ICSC: Holiday shoppers to look for deals; discount department stores top choice]
Rakuten’s survey found that 65% of retail marketers are timing their spend as late as November. It also found that 38% of marketers plan to spend the majority of their holiday budget in mid-Q4, with 25% waiting until Black Friday and Cyber Week. Only 27% are starting in October, indicating that early shoppers may not find the deals and discounts they expect.
Despite 45% of shoppers planning to spend less on holiday gifts this year, marketer confidence remains strong. A majority of retail marketers (98%) believe shoppers will remain loyal to brands, with only 2% anticipating that shoppers will trade down to lower-quality brands and products for more affordable alternatives. However, 42% of shoppers indicate they will prioritize finding the lowest prices.
Nearly half (46%) of shoppers surveyed said that inflation will have the greatest impact on their holiday shopping strategy. Conversely, only 20% of marketers believe that to be true. A quarter (26%) of shoppers say they cannot afford to buy gifts this year, indicating that they are not feeling relief from slowing inflation. Shoppers also anticipate that the upcoming election will have an impact on inflation, with 57% believing it will increase in the near future.
"Our research revealed that over a quarter of shoppers express concerns about their ability to afford gifts this season, signaling a more challenging and competitive fourth quarter for retailers than anticipated," said Van Ullen. "The election is also a significant factor that is influencing consumer sentiment, with expectations of rising prices. Shoppers will be looking for early holiday deals to avoid any potential price increases."
The survey was conducted by The Harris Poll on behalf of Rakuten from Sept. 5-9 among 2,100 consumers aged 18 and older and 101 retail marketers in the U.S.
