Deloitte Holiday Retail Survey:
Consumer Spending to Rise 5%
October 25, 2021
As COVID-19 is
set to impact yet another holiday season, a return to some
pre-pandemic spending levels is expected to bring holiday
cheer. For 36 years, Deloitte has been examining consumer
behavior and sentiment ahead of retail's crucial holiday
shopping season. To gain additional perspective on the
changing landscape, supply chain challenges and inflation,
Deloitte also added a retail executive survey. This year's
Deloitte Holiday Retail Survey,"
examines what retailers can expect from shoppers as they
tackle their holiday shopping. The report is based on a
survey of 4,315 consumers conducted online
Sept. 7-14, as well as a
survey of 30 retail executives across retail categories, 90%
of which have annual revenues of $1
billion or more, conducted
and bright holiday season, for some
2021 holiday spending intentions are approaching 2019
levels, signaling a return to our next normal. However,
there is a tale of two holiday seasons, with higher-income
households planning to spend five times that of lower-income
households. Indeed, the majority of this season's gains will
be driven by higher-income shoppers who expect to spend 15%
more than last year (averaging $2,624
per household). Meanwhile, lower-income groups plan to spend
22% less (averaging $536 per
percentage of overall consumers who do not plan to spend at
all this season is 11.5%, more than doubling from 2020
(4.9%). Two-thirds of this non-spender group (65%) are from
lower-income households compared to 12% from higher-income
spending will increase across categories with 45% of
households planning to spend the same or more on the
on experiences, which includes entertaining at home and
socializing away from home, is expected to increase 15%
year-over-year, to $536
per household, accounting for more than one-third of
on gifts is forecast to be $501
per household, an increase of 3% since 2020, while
non-gifts purchases will total
$426 per household.
Retailers are placing orders with confidence that
consumers will be spending, as 33% of retail executives
stated that holiday order volumes grew by double digits
consumers start to return to experiences, 42% plan to
take a trip this holiday season, mostly by car.
to the next normal
As pandemic anxieties decrease, the number of consumers
who are anxious about shopping in-store during the holiday
season due to COVID-19 fell to 40% versus 51% last year. As
a result, a next normal is emerging -while in-store shopping
is regaining some lost ground, online shopping is further
solidified as a holiday shopping mainstay.
spending at nearly all retail subsectors has recovered
and is at or above pre-pandemic levels.
share of in-store spending is expected to rise to 33% in
2021 (up from 28% in 2020), although this is still below
the 36% seen in 2019.
some recovery to in-store spending, digital continues to
see healthy gains, with online spending expected to rise
to $924, up from
$892 in 2020.
executives are optimistic about online sales, with 40%
expecting double-digit channel growth.
Convenience preferences from the pandemic are sticking
as consumers continue to look for simplified shopping
citing online (55%) and mass merchants (51%) as top
channels, while digital trends including standard
delivery (73%), same-day or next-day delivery (47%),
BOPIS (buy online, pick up in store) (33%) and curbside
pickup (21%) are maintaining popularity.
an increased reliance on social media to research
products continues, as 28% plan to leverage social media
for their holiday shopping, including to browse products
(56%), read reviews or recommendations (53%), and
discover promotions (50%). In addition, 52% of consumers
leverage influencer-generated content for inspiration
while looking for gifts to buy.
vice chairman, Deloitte LLP, and U.S. retail, wholesale and
distribution leader said, "Retailers will see strong growth this holiday season,
even as supply chain issues, inflation and highly bifurcated
spending continue to impact our industry. Consumers have
adapted to life during the pandemic and even though they are
venturing out again, digital engagement shows no sign of
slowing. Retailers who remain resilient by offering
promotions early, appealing to in-store and online shoppers,
and planning their inventories well in advance, are likely
to experience not just a robust holiday season, but will be
well positioned for continued sales into the new year."
Stephen Rogers, executive director,
Deloitte Insights Consumer Industry Center added, "Despite
improving consumer sentiment and spending growth, the
pandemic continues to influence how the holiday season will
play out. Due to ongoing supply chain challenges, consumers
will not only need to check their holiday lists twice, but
early. We believe those retailers that embrace the next
normal and meet these shifting consumer demands will
experience holiday cheer in the coming months."
chain challenges put a drag on holiday sales momentum
Ongoing global supply chain challenges are already
having an impact on the holiday season. Both retail
executives and consumers are concerned about supply chain
issues impacting availability of products. Three-quarters
(75%) of shoppers expect stockouts, most commonly within the
electronics and accessories (49%), as well as toys and
hobbies (35%) categories. With the average shopping period
expected to begin earlier this year, the average shopping
duration is expected to extend to more than six weeks.
- Almost 4
in 10 (39%) consumers will likely start their shopping
earlier this year to ensure timely delivery (49%) and
avoid stockouts (47%).
half of consumers (48%) are at least somewhat concerned
about shipping delays during this holiday season.
executives are also concerned about the supply chain
impact as 43% already expect their ordered holiday
inventory to be delayed, and 64% are concerned about
receiving inventory in time for the holidays. This is
despite 43% of retailers placing their holiday orders
earlier than in 2019, even as early as March.
consumers will hold delivery companies most responsible
for delays (33%), compared to weather conditions (27%),
and the retailers themselves (21%).
- As a
result, the holiday shopping season has pulled forward
with 68% of shoppers planning to shop before
Thanksgiving (versus 61% in 2020), and 43% starting
before the end of October (versus 38% in 2020). The
earlier start to the season is extending the duration of
the shopping season to more than six (6.4) weeks, as
compared to 5.9 weeks in 2020.
Black Friday events, many of which were cancelled last
year, are expected to rebound this year with 31% of
holiday shoppers planning to spend on Black Friday
(versus 24% in 2020) and another 34% planning to spend
on Cyber Monday (versus 29% in 2020).
promotions expected as inflation drives holiday prices up
When determining where to conduct their holiday
shopping, getting a great deal continues to be the top
priority for holiday shoppers. However, getting a good deal
may be harder this year due to the potential for higher
prices and fewer promotions.
than two-thirds of consumers (68%) and more than half of
retail executives (53%) expect product prices to
increase this holiday season.
holiday shoppers who plan to spend less this holiday
season, half (50%) said this was due to higher food
prices. Conversely, among those who plan to spend more,
39% said this was on account of the generally higher
cost of goods.
- In hopes
of getting a good deal, more than one-third of consumers
(37%) agree that there are better buys earlier in the
season. In a bid to woo early shoppers, 36% of retail
executives expect to begin their holiday promotions