Holiday Spending Surge: NRF Forecasts Record Consumer Spending This Season
Friday, Nov 22, 2024 5:56 pm ET
4min read As the winter holidays approach, retailers and consumers alike are gearing up for a bumper spending season, with the National Retail Federation (NRF) predicting record-breaking consumer spending. This article explores the factors driving this growth, the impact on specific sectors, and the demographics expected to drive the most significant increases in spending.
The NRF projects that consumer spending on the winter holidays will reach a record $902 per person on average, with gifts, food, decorations, and other seasonal items making up the bulk of purchases. This growth is largely driven by a strong job market and wage growth, with a projected 2.5-3.5% increase in holiday spending over 2023. Despite a 6-day shorter shopping season this year, retailers are prepared to meet consumer needs with earlier deals and sales, and by ensuring inventory availability for in-demand items.
The shift towards early shopping is expected to boost spending in sectors like electronics and books, while sectors typically dependent on last-minute shopping, such as greeting cards, may see a dip. According to Prosper Insights & Analytics, 45% of consumers plan to start their shopping before November, with reasons including spreading out their budget, avoiding stress, and pursuing promotions. This shift could benefit retailers that adapt their strategies to cater to early shoppers.
The largest increase in holiday spending is expected from young adults aged 18 to 24, with a projected 17% rise. This demographic is also more likely to shop at thrift stores and resale shops, indicating a growing preference for sustainable and budget-friendly gifts. The growing trend of sustainability may influence consumer spending in sectors like electronics and apparel, as younger consumers increasingly seek secondhand and refurbished gifts.
In conclusion, the upcoming holiday season is poised to be another record-breaking year for consumer spending, driven by a strong job market and wage growth, as well as a shift towards early shopping. Retailers and investors should take note of the projected growth in specific sectors and the demographics driving this spending, allowing them to capitalize on the opportunities presented by this holiday surge.
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The NRF projects that consumer spending on the winter holidays will reach a record $902 per person on average, with gifts, food, decorations, and other seasonal items making up the bulk of purchases. This growth is largely driven by a strong job market and wage growth, with a projected 2.5-3.5% increase in holiday spending over 2023. Despite a 6-day shorter shopping season this year, retailers are prepared to meet consumer needs with earlier deals and sales, and by ensuring inventory availability for in-demand items.
The shift towards early shopping is expected to boost spending in sectors like electronics and books, while sectors typically dependent on last-minute shopping, such as greeting cards, may see a dip. According to Prosper Insights & Analytics, 45% of consumers plan to start their shopping before November, with reasons including spreading out their budget, avoiding stress, and pursuing promotions. This shift could benefit retailers that adapt their strategies to cater to early shoppers.
The largest increase in holiday spending is expected from young adults aged 18 to 24, with a projected 17% rise. This demographic is also more likely to shop at thrift stores and resale shops, indicating a growing preference for sustainable and budget-friendly gifts. The growing trend of sustainability may influence consumer spending in sectors like electronics and apparel, as younger consumers increasingly seek secondhand and refurbished gifts.
In conclusion, the upcoming holiday season is poised to be another record-breaking year for consumer spending, driven by a strong job market and wage growth, as well as a shift towards early shopping. Retailers and investors should take note of the projected growth in specific sectors and the demographics driving this spending, allowing them to capitalize on the opportunities presented by this holiday surge.
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