Supply Chain Setbacks, Renewed Optimism Drive Early Holiday Shopping
METAIRIE — With Thanksgiving just a couple weeks away, many consumers are making holiday plans and preparing for the gift-giving season.
The latest Gulf South Index data shows that while economic and pandemic uncertainty may have consumers holding back on making large purchases for the remainder of the year, they are still eager to get together for the holidays, with 68% of Gulf South consumers planning to celebrate with family and friends.
“Even if major purchases are not on the list, consumers will be spending on gift items this holiday season as many are planning to get together, perhaps for the first time since before the pandemic,” said Marc Ehrhardt, president of The Ehrhardt Group.
WHAT KIND OF SHOPPER ARE YOU?
The approaching holidays, along with the current supply chain disruptions are causing some to make their purchases a little earlier this year to ensure on time delivery. Others have set patterns to their shopping strategy. Causeway Solutions’ Instant Insights reveal what purchasing timelines say about consumers.
“Early Birds” – Shopping before Thanksgiving – 25%
Early-bird shoppers are the most optimistic group, with 58% saying they are satisfied with the current direction of the country. 52% said they are concerned with supply chain issues and plan to shop even earlier than usual.
Early-birds value convenience, 44% prefer online shopping, while 25% prefer in-store shopping. Despite more preferring to shop online, 55% favoring trying out new products in person before purchasing compared to the 37% average.
Black Friday Shoppers – 21%
Black Friday shoppers are confident in the economy as two-thirds plan on spending the same amount or more this year as they did in 2020. This group says they have no preference between the in-store or online shopping experience. However, they are very attached to their phones, with 85% using cell phones for purchases, 68% buying through social media and 77% using their phones to compare prices and read reviews while shopping.
“Traditionalists” – Between Thanksgiving and Christmas Shoppers – 26%
Traditional shoppers are very different from both Black Friday and Early Birds. 61% are dissatisfied with the way things are going in the economy compared to 44% of the general population. They are more likely to prefer in-store shopping at 43% compared to the 28% average. This is true all year long, not just during the holiday season. More than 50% of Traditionalists say they will be spending the same as last year. Unlike the Black Friday shopper, they are less likely to use a cell phone for purchases.
Regardless of when consumers plan to shop, the headline is that shopping will be happening and maybe even more of it than last year.
“Despite how people are currently feeling about money, the predictions for holiday spending are up,” said William Skelly, CEO of Causeway Solutions. “The National Retail Federation predicted 2.0% growth in retail sales for November and December 2021, in comparison to the same time a year ago, with projections ranging from $843.4 billion to $859 billion during the holiday shopping season.”
SUPPLY CHAIN SETBACKS
According to Morning Consult’s 2021 Holiday Season Tracker, many consumers are pushing up their shopping timelines this year to allow for anticipated delays due to ongoing supply chain issues. Some brands are using the current situation to start early holiday promotions and get ahead of inevitable product shortages and delivery delays.
Out-of-stock messages are up 172% from January 2020 according to Adobe’s 2021 Holiday Shopping Forecast. This is nearly triple the pre-pandemic level. Shortages are the most widespread for clothing, with the category beating 17 other product groups with the most out-of-stock warnings. Sporting goods, baby products, electronics and pet products followed. Retailers will need to be ready with solutions and alternative recommendations as supply runs short.
Morning Consult research shows that when faced with an out-of-stock holiday gift situation, consumers are just as likely to buy a substitute from the same retailer as they are to look to a competitor for the original item.
Still, 57% of those surveyed still haven’t started their holiday shopping and are willing to take their chances on product availability. This is on par with the number of people who said the same thing this time last year.