Survey predicts rise in holiday spending

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While the frost is still not on the pumpkin, retailers are already looking ahead to this year’s holiday shopping season, which a new survey predicts will be better than the last. 

U.S. consumers are set to spend 4% more on holiday shopping this year, with average spending projected to reach $948, compared to $911 in 2023, according to the KPMG 2024 Consumer Holiday Shopping Survey. 

With many stores already displaying Christmas and other holiday season decorations and merchandise, the first of the season’s TV commercials have begun to air. The shopping survey found that shoppers are gearing up for a strong holiday season, as 49% of consumers surveyed expect to increase their holiday spending. 

“Consumers overall are showing a consistent pattern for spending between our fall survey and holiday survey across a number of key categories,” Duleep Rodrigo, KPMG U.S. Consumer and Retail Sector leader, said in a written statement. “Interestingly, when we asked about spending in general and payment methods, more than a third of millennials use buy-now pay later options. That’s the highest usage by far among the four generations.” 

A rise in holiday spending is expected throughout all income levels. Even households earning between $50,000 and $99,000 anticipate raising their spending by 10%, the KPMG survey found. 

“Understanding consumer segments has never been more important,” Rodrigo said in the statement. “Retailers who have the deepest data and analytics on preferences by income group can have the greatest success with targeted products and promotions.” 

The survey found that mass-market retailers remain the top holiday shopping destination for 71% of consumers. Just 19% of shoppers prefer to patronize luxury stores and 31% will do most of their shopping at dollar stores this year. That’s a significant shift from 2023, when 25% of consumers favored luxury stores and 35% preferred dollar stores. 

“Consumers are seeking value and convenience, making mass-market retailers the preferred choice,” Rodrigo said in the statement. “Retailers should focus on providing a seamless shopping experience and competitive pricing to attract customers.” 

About 39% of holiday shoppers polled prefer online shopping, while just 19% prefer in-store shopping, which is similar to what the 2023 survey found. 

Most of the holiday shoppers surveyed (62%) plan to use retailer websites for research, and 54% will use brand websites. However, reliance on social media and influencers for shopping insights dropped to 25% from 30% last year, indicating a decline in the influence of social platforms on holiday purchase decisions. 

Half of the consumers surveyed will shop for themselves this holiday season and anticipate spending 21% more on self-indulgences. November remains the most popular time to do holiday shopping, as 42% plan to start then, while another 31% aim to begin shopping in October. More than half (61%) of consumers polled cited Black Friday as the most important holiday shopping sales event. 

Inflation was the biggest issue for the shoppers surveyed, with 78% responding they were “very” or “somewhat” concerned. Another worry for shoppers was shipping delays, with 41% of those polled saying they were “very” or “somewhat” concerned about getting merchandise on time. 

The KPMG survey was conducted with 1,018 consumers across the U.S. between Sept. 4 and Sept. 6. The KPMG global audit, tax and advisory organization operates in 142 countries and territories and has more than 273,000 people working in member firms around the world. The company’s Long Island office is at 1305 Walt Whitman Road in Melville.