The National Retail Federation says the holiday-shopping season appears to be on track to exceed its sales growth forecast of between 8.5% and 10.5%, reported ABC News (Dec. 20).
However, with four in 10 Americans saying it has been harder to afford gifts this year, and omicron cases surging across the U.S., holiday shopping is a little different this season.
LOW-INCOME CONSUMERS HIT THE HARDEST
Half of Americans with household income below $50,000 say price increases are having a major impact on their finances, compared to a third of those in higher-income households, according to a new AP-NORC poll.
C. Britt Beemer, chairman of the America’s Research Group, estimates that low-income households are cutting back their holiday buying by 20% from a year ago, as reported by ABC.
A recent government report showed that consumer prices jumped 6.8% over the past year with some of the largest spikes coming from food. With that, lower-income households must balance putting food on the table with scaling back on holiday gifts.
GIFT CARDS MORE POPULAR THAN EVER
Shoppers plan to buy 15 gift cards on average during the holidays, up 50% from 2020 and 200% from 2019, according to branded payment service Blackhawk, reported morningbrew.com (Dec. 17).
The surge in gift cards could be due to several factors, ongoing supply chain challenges being one of them. In October alone, out-of-stock messages showed up over two billion times, which is an increase of over 3x since 2019, according to Pitney Bowes data.
Additionally, with the omicron variant looming and cases on the rise, last-minute Christmas shoppers might be more hesitant to head out into stores this week, which could add to gift card sales.