Dive Brief:
- Eighty-two percent of consumers plan to shop during Black Friday week this year, up from 79% last year, according to a new Deloitte survey of 1,200 consumers. Almost all (92%) Gen Z shoppers said they would participate.
- Despite higher participation, shoppers on average plan to spend $622 on holiday purchases during the period, down 4% from a year prior. The top two reasons why shoppers are curtailing their spending are the rising cost of living (69%) and financial constraints (43%), the report found.
- Shoppers earning $50,000 or less plan to cut their spending by 12%, while those earning over $200,000 will cut back by 18%. Those in the middle, who make between $100,000 and $199,000, will increase their spending by 5%.
Dive Insight:
As the cost of living and economic headwinds weigh on consumers’ wallets, shoppers are looking for ways to get more for their money this holiday season.
Along with scouring Black Friday and Cyber Monday sales for discounts, 64% of shoppers plan to use credit cards or buy now, pay later services to extend their budgets, the survey found. While the share of consumers paying with BNPL options is flat year over year at 29%, the proportion of shoppers paying with credit cards is expected to rise slightly from 53% in 2024 to 56% this year.
Consumers are heading to brick-and-mortar stores for their Black Friday bargain hunt and will shift more of their spending to that channel. Shoppers are expected to spend 8% less online on Black Friday, but 4% more in stores year over year, Deloitte found. Gen Z is leading the trend, with 72% planning to shop in-store on Black Friday, according to the survey. Although Gen Z plans to actively participate in Black Friday week, a PwC report earlier this year found that Gen Z consumers plan to slash their holiday spending by almost a quarter compared to last year.
Other research also points to consumers reigning in their spending, stretching their payments and searching for value to cope with a shaky economy this holiday season. While American shoppers earning below $50,000 a year are expected to spend 24% less on holiday purchases this year, consumers earning more than $150,000 expect to spend 26% more on their gifts, according to a JLL report published in October.
Though many shoppers are trimming their holiday budgets, sales during the overall holiday period are projected to hit a new milestone. In November and December, retail sales could reach $1 trillion for the first time, the National Retail Federation predicts. Shoppers are projected to spend an average of $890.49 during the holiday season, per that report.
