Holiday Survey: Locals to Spend More on Gifts, Less Overall
Twin Cities consumers plan to spend $430 on gifts during the upcoming holiday season, 10 percent more than the national average and 3 percent more than local shoppers planned to spend in 2011, according to the results of a holiday spending survey released Tuesday.
In its 27th annual survey of holiday spending intentions and trends, New York-based accounting firm Deloitte also found that local shoppers plan to decrease their overall holiday budgets—which include spending on socializing, entertaining, clothing, and home and holiday furnishings—by about 3 percent to $1,000 as compared to last year.
The survey, conducted between September 14 and 24, polled 5,089 consumers nationally, including 500 in the Twin Cities. Local shoppers said they expect to buy the same number of gifts as last year but will spend slightly more on each one.
Although 53 percent plan to purchase gift cards, they have declined in popularity as clothing has risen to the top of shopping lists for the second consecutive year; 55 percent of local consumers plan to purchase apparel as gifts. Other popular gifts among Twin Cities shoppers are books, which 46 percent plan to buy, and food and liquor, which 39 percent will purchase as gifts.
Many local shoppers apparently like to make purchases online; 56 percent of those surveyed said they plan to shop for holiday gifts online, a figure that’s 11 percentage points higher than the national average. Almost a quarter of local shoppers said they will make the majority of their holiday purchases via the Internet. Meanwhile, 83 percent said they are more likely to shop from online retailers who offer free shipping, and 63 percent prefer sites that offer free returns.
However, 17 percent of local survey respondents said they were going to delay holiday shopping until after the presidential election on November 6. (Nearly a quarter of national respondents plan to do the same.)
Another major finding from the survey: After a long period of unease, local consumers have a positive outlook when it comes to the economy. Nearly six in 10 Twin Cities shoppers expect the economy to improve in 2013—which represents their most positive outlook since 2009; nationally, half of consumers predict improvement next year. Additionally, more than three-quarters of local survey respondents indicated that their current household financial position is the same or better than it was last year, and 54 percent feel secure in their jobs.
“Following years of anxiety and uncertainty, consumers’ feelings about their personal financial situations and the economy as a whole appear to be brightening,” Scott Erickson, a Deloitte & Touche, LLP, partner who serves Deloitte’s retail and distribution sector clients from Minneapolis, said in a statement. “However, they remain cautious as high food and gas prices and debate about the fiscal cliff continues. Retailers that engage consumers through technology, particularly when they visit a brick-and-mortar store, may have reason to celebrate this season.”
As technology evolves, more consumers are building it into their shopping routines. Nearly six in 10 Twin Cities survey respondents indicated that they own a smartphone, up 30 percent from last year. And the majority—77 percent—of smartphone users surveyed said they plan to use their devices for holiday shopping.
More than half, or 55 percent, of local consumers plan to use debit cards, cash, or checks to pay for the majority of their holiday purchases; 42 percent, meanwhile, said they’ll charge their purchases to their credit cards.
Deloitte projects that total holiday spending in the United States will grow 3.5 percent to 4 percent to between $920 billion and $925 billion during the upcoming holiday season.
Deloitte, which operates a Minneapolis office and employs about 800 within the state, is among Minnesota’s three-largest accounting firms based on licensed Minnesota CPAs, of which there are close to 250.