Shopping Isn’t Dropping
Yes, we know: The holiday shopping season is being pushed earlier and earlier every year.
So why are we bringing up the year-end holidays right after Halloween? Hear us out. Holiday shopping is one of the economy’s biggest drivers, and the seasonal trends can identify broader insights about the strengths and weaknesses of the economy, both now and in 2023. And both locally and nationally.
And locally, the season ahead is looking remarkably merry and bright. Consulting firm Deloitte just released its 2022 holiday retail survey for the Minneapolis-St. Paul (MSP) region. The survey polled 452 MSP consumers from September 6 through September 21. The numbers suggest that metro-area shoppers aren’t letting inflation, worries about recession, supply chain snarls, and the lingering effects of Covid dampen their holiday spirit, at least as it’s reflected in their spending.
Based on the people surveyed, the report finds that Twin Cities metro-area shoppers plan to spend 20% more this year over 2021. Of the respondents, 74% said they would spend more or the same on the holidays as they did last year. That spending includes both traditional gifts as well as “experiences” such as concerts and holiday entertainment. At the same time, MSP consumers plan to buy fewer gifts. That’s probably due to inflation, as well as the survey showing that 44% of respondents believe their financial situation has grown a little more precarious.
Compared to the rest of the country, the Twin Cities region appears to be more optimistic.
Still, compared to the rest of the country, the Twin Cities region appears to be more optimistic. Figures from the national Deloitte holiday shopping survey for 2022 suggest that most of the country will be spending less than they did during last year’s record-setting holiday season. According to the National Retail Federation, retail sales nationally during 2021’s November-December holiday season grew 14.1% over 2020 to a new record high of $886.7 billion. The Deloitte national survey suggests, however, that holiday spending will be flat this year, and that it might even be down from 2021.
The Deloitte survey also shows that Twin Cities metro consumers shop the holiday season a little differently from the rest of the country. They do about 70% of their seasonal shopping from the last half of November through the end of December—in other words, the more “traditional” shopping time. Up to 53% of MSP shoppers plan to shop during Thanksgiving week – mostly on Black Friday and Cyber Monday – up from 44% last year. Nationwide, more gift-buyers tend to start as early as mid-October. The survey suggests that more Minnesotans were also planning to get an earlier jump on their holiday purchases this year.
Another intriguing insight from the survey: Compared to the U.S. as a whole, MSP shoppers have a stronger preference for mass merchants (64% versus 49%) and online retailers (63% compared to 56%). Perhaps that’s because the region is home to Target and Best Buy—and cold winters make going out to the stores a little less appealing.
For now, at least, the holiday forecast in the Twin Cities looks distinctly festive. But admittedly, it’s early yet.