Average Holiday Spending Seen Rising With Majority Starting To Shop Before Black Friday; Online Shopping Grows: KPMG Survey

By STS News Desk On Nov 8, 2019

Average Holiday Spending Seen Rising With Majority Starting To Shop Before Black Friday; Online Shopping Grows: KPMG Survey

Average holiday season spending is expected to rise by 5% – a KPMG LLP survey found – in an environment where retailers will be seen melding “bricks and mortar” with online convenience.

“Retailers of all sizes, categories and channels will compete fiercely during the lucrative 2019 holiday shopping season by offering early sales to seamless in-store and online customer experiences,” said Scott Rankin, principal, Consumer and Retail Strategy practice leader. “Although shoppers will make most of their purchases online, in-store shopping remains significant this season, with mass merchants being particularly strong.

“Holiday shoppers will continue to seek value and convenience, and increasingly use digital tools to guide their decision making,” Rankin added.

Average spending per person this holiday season is expected to increase to $768, compared to $730 in 2018, with the majority of consumers (57%) starting to shop before Black Friday. Convenience and value are expected to drive online shopping growth this holiday season, with nearly three-quarters (73%) of consumers expected to do the majority of their shopping online, compared to just 64% last year, according to KPMG’s 2019 holiday shopping report, “Prepping for the Holidays – How Retailers Can Make This Year’s Critical Shopping Season Merry.”

Shoppers are starting to spend their holiday budget earlier this year:

One in five (20%) holiday shoppers already began spending their holiday budget this year.
The majority (57%) of holiday shoppers will start spending their holiday budget before Black Friday.
High-value shoppers (customers spending at least $1,000 this holiday season) are significantly more likely (69%) than other shoppers to make purchases this October and November.
Early shoppers plan to spend twice as much as customers who wait to shop until after Black Friday.

Increase in online shopping will significantly boost 2019 sales growth:

The share of online shopping is expected to grow to 58% this year compared to 52% in 2018, driven by 43% of shoppers, who are also on average increasing their spend.
73% of consumers are expecting to do more than 50% of their shopping online this year, nine percentage points higher than in 2018; these consumers are also spending 15% more on average.

Where and what to buy this year remains consistent with last year:

Shopping channels are expected to remain similar to last year, with online retailers (74% in 2019 compared to 72% in 2018), and mass merchants (72% in 2019 compared to 70% in 2018) expected to grab the highest purchases.
All product categories remain relevant, with at least half of consumers planning to buy apparel and accessories (65%), electronics (52%), and toys and other children’s products (49%) this holiday season.
High-value customers are planning to shop across more channels, with a focus on department stores (64%), electronics (45%), and clothing (50%).

What is driving consumers’ decision making this year?

Price (81%)
Free shipping (59%)
Promotions (49%)
The majority of consumers are increasingly using general online search engines, 73% compared to 68% in 2018, and other digital resources to guide their decision making.