Holiday shopping is back, with spending expected to surpass pre-pandemic levels for the first time, reports the 2023 Deloitte Holiday Retail Survey. Consumers surveyed plan to spend an average of $1,652, representing a 14% year-over-year increase, though a modest four-year compound annual growth rate of 2.5% reflects a normalization of trends. All income groups plan to spend more this year, with the middle-income group (those making $50,000 to $99,999) seeing the most significant gains and intending to spend 26% more year-over-year.
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) and spending more on gift cards ($300 versus $217 in 2022). They also plan to take advantage of promotions, with 66% planning to shop Black Friday through Cyber Monday versus 49% in 2022.
“Although inflation shows signs of moderating, consumers have come to expect higher prices and are adjusting their holiday spending accordingly,” said Nick Handrinos, vice chairman of Deloite LLP and U.S. retail, wholesale and distribution and consumer products leader. “We expect to see shoppers make their lists and check them twice for deals, but a return to pre-pandemic spending levels shows promise for the season overall. Retailers can expect continued store growth as shoppers aim to maximize their budgets with their favorite retailer, presenting new opportunities to build loyalty.”
Consumers said non-gift purchases (up 25% year-over-year) are a priority this season as they restock holiday decorations, furnishings and non-gift apparel.
