PwC Holiday Outlook: Black Friday Less Relevant, Millennials Will Spend Most

Black Friday, once known as the biggest shopping day of the year, has become less important to consumers. Just 20% participating in a study published Thursday by PwC said they plan to shop on Black Friday this year, down from 60% in 2015. 

In the survey, fielded in July 2022, PwC asked 4,000 consumers where and when they plan to shop and travel, as well as what drives their purchasing decisions. Consumers told PwC they will do 57% of their shopping online and 43% in stores. 

About 41% participating in the PwC Holiday Outlook 2022 study said they will do their shopping between Thursday and Monday of the Thanksgiving weekend. Some 25% said they will do their shopping in early November, and 17% will wait until after the Thanksgiving weekend.

Consumers overall plan to spend an average of $1,430 on gifts, travel and entertainment this year, similar to the $1,447 each spent last year. This is up 20% from 2020 and more than 10% higher compared with 2019.

Breaking down the numbers, consumers plan to spend $754 on gifts, $452 on travel, and $225 on entertainment.

Kelly Pedersen, PwC U.S. retail leader, said that aside from Black Friday taking a backseat to other holiday shopping days, “one of the most interesting data point the study revealed is in the demographic and who is spending the money.”

Millennials ages 26 to 40 are the only age group that is really spending more this holiday season -- about 11% more.

PwC attributes that to “The Great Reshuffle,” job-hopping during COVID. Millennials said they will spend 27% on average more this year — about $1,823. Pedersen said Millennials are coming into their own in terms of wealth. 

Slightly more than half of consumers, at 53%, are concerned about inflation. That percentage is up from 45% in 2019. And while the factors driving inflation are on a rollercoaster ride, with higher gas prices expected, consumer sentiment has begun to tick up gradually.

“We spoke with a very big retailer recently who is starting to see relief on their costs,” he said. “That means we could potentially see costs come down.” Hopefully there will be some relief on inflation.”

Nearly 75% of consumers — including 87% of boomers—are braced for higher prices this holiday season and are actively hunting for bargains. Price is the biggest factor influencing holiday spending at 65%, but it’s not as big of a concern as it was last year at 75%. Convenience at 43% and speed of delivery at 40% round out the list of important factors this holiday season.

Ninety-three percent of consumers say trust is top-of-mind this holiday season —  up 70% from 2020 and 2021.

After trust, 57% of consumers cited local producers and 36% pointed to stores, while 31% prefer sustainable retailers and 27% cite socially and environmentally responsible brands.

The report did provide a note of caution. Some 38% said that breaking the trust caused by items arriving after the expected delivery date —  and 33% who cited incorrect items shipped — will prompt them to find a new brand or retailer.

Debit cards will make a comeback this holiday season, with 60% of consumers planning to use one. Credit cards and cash are a preferred method, with 53% of respondents planning to use them. Buy now, pay later platforms for online shopping are gaining ground, with about 5% of consumers using them last year, and 13% this year

Consumers also have begun to make purchases in the metaverse. In another PwC consumer insights survey, about one-third have used virtually reality, and one-third of those bought products. The purchase might not be made directly in the metaverse, but they find the product there and then purchase it on the brand’s website or in a store.

“We have found that the holiday spending report is almost indicative to what we can expect for the next year,” Pedersen said. “It is a leading indicator.”

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