Dive Brief:
- Due to concerns about price hikes stemming from tariffs, 71% of consumers plan to be more selective in their holiday purchases, according to an ICSC survey of over 1,000 consumers released on Tuesday.
- Nearly two-thirds of respondents will avoid buying items from retailers that significantly raise their prices. To find lower prices, 64% of shoppers plan to spend more time looking for deals, and 67% expect that their hunt for discounts will lead to more trips to stores, the survey found.
- The majority, more than 9 in 10, of survey respondents expect to make their holiday purchases in physical stores, a trend led by younger generations, according to the survey. While nearly two-thirds of respondents will shop at discount department stores, more than one-quarter will shop at traditional department stores.
Dive Insight:
ICSC’s findings echo other reports suggesting that consumers are bracing for higher prices this holiday season. In response, some will cut their holiday budgets in some categories and use AI to make their holiday shopping decisions.
Eight in 10 shoppers anticipate that tariffs will spur price increases this holiday season, a survey from KPMG found. While roughly 2 in 5 shoppers overall are using AI to research their holiday purchases, 56% of Gen Zers and 62% of millennials are integrating the technology into their product research, according to KPMG’s findings.
Meanwhile, another survey from UserTesting found that a third of shoppers will use AI to help guide their holiday shopping this year.
“Despite economic concerns, our survey shows that consumers are committed to their holiday traditions and plan to shop,” Tom McGee, ICSC president and CEO, said in a statement. “Our forecast reflects that resilience, but our data also signals a selective shopper, putting pressure on retailers to connect with shoppers in new ways and offer memorable shopping experiences that entice them to spend.”
As consumers carefully consider their spending decisions, research suggests that retailers aren’t deepening their discounts this holiday season. Adobe Analytics predicts that retailers will discount their products by up to 28% off the list price, roughly the same rate as last year.
