This year’s holiday season is going to be a gloomy one for retailers across the globe.
Shoppers plan to cut $55 billion from their non-food spending. And 58%
are reducing their outlays, according to the Holiday Shopping Trends Report from Metapack, conducted by Retail Economics.
Consumers cite these reasons for their
unease:
- Rising inflation — 28.8%
- Rising uncertainty about the economy — 18.3%
- Lack of savings
— 11.6%
- Loss of earnings — 11.5%
- Rising interest rates — 9.6%
- Lack of available credit —
8.6%
But what are retailers doing to offset their own rising operating costs? Their responses, which apparently come from other research, are not likely to please consumers:
- Increasing cost of delivery — 34.7%
- Changes to delivery time frame — 26.2%
- Increasing
promotions —18.1%
- Eliminating free returns — 10.1%
- Restricting returns policy — 7.6%
- Increasing staff — 3.3%
The study puts consumers into four categories:
- Distressed —
34%
- Secure but concerned — 30%
- Undeterred — 23.1%
- Stretched spenders —
12.5%
U.S. shoppers are not as troubled as the overall average:
- Distressed — 30%
- Secure but concerned
— 38%
- Undeterred — 21%
- Stretched spenders — 12%
But a majority of U.S. consumers are cutting
back due to the rising cost of living:
- Plan cut back across ALL related spend — 30.1%
- Yes, plan cut back across MOST related spend —
11.8%
- Yes, plan cut back across SOME related spend — 16.3%
- No, have no plans to cut back relates spend — 41.5%
In contrast, 40.1% of UK shoppers plan to cut all related spending.
The UK is facing a 22% reduction in holiday shopping spending, for a total of U.S. $5.2 billion. The U.S.
will be taking a 14.4% hit totaling U.S. $30.6 billion.
Germany will suffer only a 9.4% slide, for $3.4 billion.
The following product areas will be seeing
cutbacks:
- Apparel — 26%
- Electricals — 22.3%
- Toys — 20.9%
- Home-related — 19.8%
- Health & Beauty — 17.4%
- DIV & Gardening — 16.7%
Less-affluent consumers are being especially hard-hit.
What can brands offer consumers in their holiday emails and web promotions? Free returns are very important
to 93% of shoppers, more than speed of delivery, the study states.
Retail Economics surveyed 8,000 consumers across the UK, USA, Canada, Australia, Germany, France, Italy and Spain in
August 2022.