About 61% of consumers say they plan to spend about the same on holiday purchases as last year, up 2 points from the prior year. About one-third plan to spend less, which is the same as last year; and only 9% say they plan to spend more, down 2 points from 2009.
“Even though the recession is technically over, lingering concerns are keeping consumers in a cautious frame of mind,” said Marshal Cohen, chief industry analyst. “We are seeing what I call ‘calculated consumption.’ and I believe that it is a consumer mind-set that will be around after holiday shopping is over.”
Evidence of consumers’ more thoughtful and cautious approach this holiday can be seen in the fact that 62% of consumers say they plan to do some kind of ‘homework’ prior to making a purchase. Almost 44% of consumers say they will comparison shop before they buy a gift. Thirty-seven percent say they will use ads or circulars to guide their gift shopping, and 33% say they will compare prices online before they shop in a store.
“What this means is consumers will be looking to find what to buy, when to buy and where to buy before even leaving the house,” Cohen said. “This eliminates the rushed decisions and can potentially eliminate some impulse purchasing from the holiday shopping equation.”
The primary influence on where consumers will shop for gifts this year remains ‘price’ (60%). ‘Special sale price’ came in second with 58%, followed by ‘convenient location’ at almost 47%.
In almost every category this year, there is a drop-off in intended purchases. Consumers who said they plan to by food as a gift in 2010 totals 15% vs. 18% in 2009.
“Again, this year the real challenge is the absence of newness and excitement,” Cohen observed, “The more progressive brands will learn from mistakes of the recent past and ramp up the excitement in their product offerings. And in turn retailers will be looking for those products to ignite consumers’ passion to spend this holiday.”
The NPD Holiday Survey of Consumer Purchase Intentions was fielded to members of NPD's online consumer panel from Sept. 7th to Sept. 15th. The survey was fielded to a US representative sample; the findings presented represent 2003 completed surveys. NPD maintains an online panel of nearly 2 million consumers who tell them about their shopping habits.