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As the holiday season approaches, it’s a common perception that retailers must be banking on the last three months of the year to rake in a significant portion of their annual sales. And — while TikTok might have brands believing that Black Friday 2023 was a bust (though it did expose Target’s sneaky little tricks) — you can’t believe everything you see on the internet.
In all actuality, Black Friday 2023 blasted off with a stellar $9.8 billion in online sales, a whopping 7.5% leap from last year, as reported by Adobe Analytics. And the number of people shopping in stores shot up by 4.6%, outpacing the usual crowd traffic we’ve observed throughout the year, according to Sensormatic Solutions. While inflation has dialed back, giving consumers a bit of breathing room, they’re still navigating through a nebula of challenges, like dwindling savings from the pandemic and rising interest rates on loans.
It’s a complex universe of economic activity, but shoppers are seemingly undeterred, fueling a significant portion of the US economy.
The consultancy firm Deloitte has projected a busy shopping season this year. Its annual holiday survey revealed:
- Holiday shopping is back, with spending expected to surpass pre-pandemic levels for the first time. Consumers surveyed plan to spend an average of $1,652, representing a 14% year-over-year increase.
- Nearly all consumers surveyed plan to participate in the holiday season (95%, up from 92% in 2022 and 88% in 2021), reflecting a return to pre-pandemic levels.
- Nearly three-quarters (72%) of consumers surveyed expect higher prices and plan to navigate inflation by budgeting for fewer gifts (eight versus nine in 2022), spending more on gift cards ($300 versus $217 in 2022), and seeking out deals (66% plan to shop Black Friday — Cyber Monday (BFCM) versus 49% in 2022).
- Nearly one-third of shoppers’ budget will be spent in the last two weeks of November, with 78% actively shopping then.
Despite concerns about a looming recession and persistent inflation impacting household budgets, consumers seem determined to enjoy the festive season. Retailers responded to this enthusiasm by launching Black Friday sales well ahead of time, both online and in-store. With inflation still a concern, promotions, and discounts are playing a crucial role in buying decisions. Deloitte’s survey indicates a significant increase in shoppers looking to capitalize on Black Friday and Cyber Monday deals compared to last year.
However, budget constraints remain evident.
A notable portion of sales comes from ‘Buy Now, Pay Later’ options, reflecting consumer efforts to manage their finances amidst high inflation and interest rates. The leading categories for Black Friday sales were electronics, toys, and gaming, directly correlating with the extent of discounts offered.
While the holiday quarter remains significant for certain retailers, its overall impact on annual retail sales is less dominant than commonly assumed. The changing shopping habits, influenced by economic factors and the convenience of online shopping, are reshaping the retail landscape, especially during the crucial holiday season.
Notable Holiday Campaigns from WinmoEdge:
For ad sellers looking to tap into holiday ad budgets, it may be late in the game, but who knows, by some Miracle on 34th Street supplemental dollars could be had…
Momvertising Opps: The Honey Baked Ham Company launches holiday push amid significant spend increases (Score 51)
Macy’s kicks off holiday campaign (Score 65)
Female Gen-Z, Millennial Opps: Reef appoints first-ever CMO amid spend increases (Score 59)