NEW YORK, November 21, 2022 /PRNewswire/ —
- Consumers will spend an average of $500 during Black Friday and Cyber Monday (BFCM) shopping events (Thursday 24 November – Monday 28 November), +12% compared to last year.
- Over the holiday weekend, shoppers expect to rely more on credit payment options including credit cards (48%) and buy now, pay later (37%) stretch vacation budgets.
- Looking for offers and promotions, buyers will spend half of their vacation budgets in the BFCM period.
- 8 out of 10 holiday shoppers intend to shop during BFCM events (against 71% in 2021).
Because this is important
As shoppers look for ways to spice up the holidays, inflation is weighing on the spirit of the season. As consumers create their gift lists and double-check them, Deloitte’s “2022 Black Friday-Cyber Monday Survey” examines what retailers can expect from shoppers between Thanksgiving and Cyber Monday. Conducted online October 19-28the report surveyed 1,200 adults, ages 18 and older, planning to buy holiday gifts.
Thanksgiving shopping to spark joy for retailers
Despite continued inflationary pressures, consumers are opening their wallets to ensure the season is merry and bright for family and friends. During the BFCM period, shoppers expect to spend half of their budgets on vacations, with all income groups expected to spend the most year-over-year.
- Shoppers are sticking to their initial vacation spending plans: 81% plan to spend the same or more than they did two months ago. Nearly half (48%) of those planning to spend more will do so because of higher prices, up from 41% last year.
- Purchases during the BFCM period are on the rise and on par with pre-pandemic levels: 80% of consumers plan to shop during the five-day holiday period, up from 71% in 2021 and 79% in the 2019. Younger generations are leading the charge: 86% of Gen Z and 89% of Millennials plan to spend during the time period.
- Spending is expected to increase across income groups. The lowest incomes (those who earn the least $50,000 per year) expects to increase its top spend over the five-day period, up 19% year-over-year to $320. In comparison, top earners (those earning more than $100,000 per year) plan to increase their spending by 4% a $650.
Consumers are counting on credit to stretch vacation budgets
Amid higher prices, consumers are increasingly relying on credit to stretch their vacation budgets. This comes as a third (33%) of BFCM shoppers are concerned about upcoming payments, up from 26% in 2021.
- Nearly half of BFCM shoppers (48%) plan to use credit cards to stretch vacation budgets, up from 35% in 2021. Additionally, credit usage is on the rise among all income groups: households low income households (50% vs 27% in 2021), middle income households (45% vs 38% in 2021) and higher incomes (49% vs 45% in 2021).
- Buy now, pay later (BNPL) is also on the rise: 37% of BFCM buyers plan to use this option to make the most of holiday gifts.
- Among shoppers planning to spend over the holiday shopping weekend, 43% say they will delay large purchases.
“As inflation continues to hit consumers all the time, they are unwilling to let it dampen the holiday spirit. Participation in holiday weekend promotions and spending is expected to increase this year as consumers are willing to make anything you need to celebrate the season, including leveraging payment options for gift purchases.Retailers working to build consumer loyalty during this challenging time may be well positioned in the new year.”
— Nick Handrinosvice president, Deloitte Consulting LLP, and leader in US retail, wholesale and distribution and consumer products
Consumers are adding good deals to their vacation wish list
Economic uncertainties prompted earlier searches for and buying deals, continuing to push the holiday season forward. However, Black Friday and Cyber Monday continue to capture a significant share of the shopping budget as inflation drives consumer demand for business.
- Consumers are adapting to the uncertain environment by shopping earlier and bargain hunting. By the end of October, shoppers had spent nearly a quarter (23%) of their vacation budgets.
- More than half of consumers (57%) say retailers are offering the same or greater discounts than last year, and 87% of shoppers have previously purchased promotional gifts.
- Attendance on Black Friday and Cyber Monday is on the rise, up to 64% and 56%, respectively. Black Friday shoppers should spend $205 on average, from $190 in 2021, while Cyber Monday shoppers are expected to spend $218 on average, from $175 last year.
- BFCM events are becoming more and more channel independent. While Cyber Monday continues to capture a significant share of the online shopping budget, 69% of consumers say retailers are offering comparable deals online and in-store over the holiday weekend. For example, the share of online and in-store sales for Black Friday is nearly the same at 16% and 17%, thanks to better price transparency.
- While preference for online retailers remains stable at 54%, mass merchants (63%, up from 57% in 2021) and department stores (35%, up from 29% in 2021) regain their lost share while consumers look for traditional BFCM promotions.
“With half of holiday budgets expected to be spent on the Thanksgiving shopping weekend, it’s a critical time for retailers. Consumers of all income levels are looking to maximize their holiday budgets, thus seeing value in promotions set to run throughout the week.While Black Friday deals are traditionally in-store, the event is becoming increasingly channel-agnostic, with retailers offering comparable deals both in-store and online.Retailers who can differentiating yourself through return policies, warranties and other perks can appeal to consumers and result in a successful holiday season.”
— Sides of the rodDeloitte Insights global leader and vice president, US retail, wholesale and distribution and consumer products
Connect with us on Twitter at @Deloitte CB or on Linkedin: @NickHandrinos and @RodSides.
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