This Christmas, Consumers Love Cash (And Bling)

Paying in cash

This holiday, consumers are turning thumbs down on credit cards and thumbs up on jewelry: A new survey from the National Retail Federation reports that shoppers are planning to pay cash or using debit cards, and that credit card use is at its lowest level since 2002.

And that combination of practical, careful shopper meets the urge to splurge makes sense, Phil Rist -- EVP for BIGresearch, which conducted the survey for the NRF -- tells Marketing Daily. "After years of practicality, Americans are getting more excited about buying special gifts for the people they love. And because people are aware that this will be a very promotional holiday period, they know they can do both."

People may be showing greater signs of practicality, like cutting back on credit cards and giving gift cards to those who are hard to shop for, "but we need to remember the holidays are about buying things for people you love," he says. "It is emotional."



The NRF's survey reports that 43% of holiday shoppers will rely on debit cards -- a 20% increase from 2005. Some 25.7% say they will pay cash, up from 24.9% last year. And just 27.6% of shoppers will charge their gifts, which the Washington, D.C.-based trade association says is the lowest since 2002's 26.8%.

Consistent with its earlier polls, 20.3% of shoppers plan to buy someone holiday jewelry, up from 18.4%. The survey included more than 8,700 American adults.

Shoppers are responding to retailers' efforts to move up big promotional events, encouraging early shopping: Some 10.5% of consumers say they have finished at least half of their shopping. Last year at this time, it was just 9.2%. So far, chains like Best Buy, Target, Sears, Walmart and Toys R Us have all taken major steps to get people jonesing for Black Friday earlier than ever.

Another study shows those moves are paying off, at least in shoppers' eyes. Experian's PriceGrabber polled more than 1,800 of its online shoppers, and found that 61% believe Thanksgiving weekend has the best shopping deals. And of that group, 86% say the best deals are found on Black Friday. Cyber Monday came in second, with just 33%.

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