Consumers are expected to modestly increase their holiday gift budgets this year as they remain cautiously optimistic amid continued economic uncertainty, according to The National Retail Federation.
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The average holiday shopper will spend $749.51 on gifts, décor and greeting cards this season, up slightly from $740.57 spent on average last year. The NRF forecast last month that total holiday sales will grow 4.1% to $586.1 billion.
“Despite the challenges that still exist in our economy, it looks as if consumers are eager to celebrate with friends and family,” NRF Chief Executive Officer Matthew Shay said in a statement.
The biggest portion of consumer budgets is expected to go toward gifts for family members, with the average person planning to spend $421.82 on children, siblings, parents and others, according to the NRF study conducted with BIGinsight.
The NRF said total spending on holiday décor will reach $6.9 billion, with food and candy capturing more than $100 of shopper’s budgets and decorations averaging $51.99 per person, followed by greeting cards and flowers.
As retailers like Best Buy (NYSE:BBY) and Target (NYSE:TGT) offer promotions and plan to match rival prices, the number of shoppers self-gifting is expected to reach the highest in more than 10 years.
About 59% of consumers plan to spend an average of about $140 on themselves this season in an effort to take advantage of retailers' door-buster deals. Ages 18 to 24 will likely lead the increase, each projected to spend an average of $159.62 on self-gifting, lured by deals for hot-ticket items like the new Apple (NASDAQ:AAPL) iPhone and tablets made by Amazon (NASDAQ:AMZN) and Samsung.
“Retailers’ holiday promotions continue to strike a chord with this age group, especially with promotions surrounding popular electronics and apparel items,” BIGinsight Consumer Insights Director Pam Goodfellow said.
More than 40% of consumers say they plan to start holiday shopping before Halloween, which could be a reflection of more retailers, including Wal-Mart (NYSE:WMT) and Toys “R” Us, offering layaway this year for consumers who don’t have access to traditional forms of credit.
The earlier start is also a reflection of consumers on a budget comparing items at various stores and retail websites to find the best deals. Setting a new record, more than half of consumers will shop online for gifts this season, up from 46.7% last year.