A recent study from Rakuten highlights a divide between retailers’ expectations and the reality of consumer holiday shopping plans in 2024. According to the survey, 81% of shoppers have no intention of increasing their holiday spending this year, showing a potentially challenging season for marketers.
“As shoppers plan to spend less overall, there become fewer opportunities for retailers. This makes it evermore important for retailers to invest in strategies that set them apart throughout the entire holiday season. By investing early and capturing market share among early holiday shoppers, retailers can set themselves up for success in Q4. This approach also allows retailers to establish new relationships, or reinforce existing ones, with shoppers whose loyalty can’t be assumed,” said Julie Van Ullen, Chief Revenue Officer at Rakuten Rewards.
Despite this, retail marketers are still optimistic about meeting their goals, with 79% confident in hitting holiday sales targets. However, the timing of these marketing efforts may present hurdles: 65% of marketers are holding back their budgets until November, and a significant 38% are reserving most of their holiday marketing spend until mid-Q4. Only 27% of marketers are beginning their holiday promotions in October.
One of the major factors shaping consumer decisions this season is inflation. While inflation rates have eased slightly, 46% of shoppers report that it continues to impact their holiday shopping strategies, with some shoppers stating they feel slight relief. In contrast, only 20% of marketers believe inflation will significantly influence consumer spending. In addition, 26% of shoppers say they are financially unable to afford gifts this year, and 57% expect inflation to climb due to the upcoming election.
Early shoppers also show signs of caution. Concerns about potential shipping delays are prompting 42% of shoppers to start buying earlier, and 32% are planning to increase their in-store shopping to sidestep shipping issues.
Adding to retailers’ challenges, loyalty may not be guaranteed. Although marketers are optimistic, 98% believe shoppers will stick with their preferred brands, Rakuten’s study shows that 42% of consumers will focus on finding the lowest prices, signalling that many may be willing to switch to more affordable alternatives.