Holiday spending is shaping up quite differently this year, following months of COVID-19 vaccines and gradual restaurant recovery.
Not only are people shopping earlier this season — with stats from NPD Group showing that 51% of consumers plan to start holiday shopping before Thanksgiving — but they’re spending more and on new products.
Here’s more on how holiday spending is taking on a different look in 2021:
SPENDING UP
Amid waning pandemic anxiety and stabilizing consumer sentiment, holiday spending will average $1,463 per household, up 5% from 2020, with higher-income shoppers driving nearly all gains, according to Deloitte.
Some pre-pandemic behaviors are also returning, such as experiences (including socializing, travel and entertaining), which increased 15% from 2020.
“After 2020, consumers are looking to spend money. While the pandemic isn’t behind us, things are looking up, and shoppers are motivated to spend again, particularly when it comes to the food industry,” said Seb Evans, co-founder of Banquist – which offers cooking classes – in an interview with The Food Institute.
“People miss eating out at restaurants and having large family gatherings in their homes.”
Evans believes we’ll be seeing an increase in outdoor dining, carryout meals, pre-packaged food, and bulk shopping during the holiday season.
SURGE IN GIFT-CARD BUYING
A new survey indicates there could be a surge in gift-card buying this holiday season, particularly for restaurants and big box stores, reported Restaurant Business.
Research from Blackhawk Network shows 83% of consumers surveyed said they want to give a gift card instead of a physical gift this year, and respondents said they expect to devote 41% of their holiday gift budget on gift cards – a 27% increase from last year.
In 2020, restaurant gift card sales were down considerably from 2019, according to data from guest experience platform Paytronix Systems.
Alex Mastin, CEO of Home Grounds, told The Food Institute that the surge in gift-card buying “is a contemporary approach to gifting triggered by the pandemic; it will save people a lot of hassle and will definitely help the industry move forward.”
NEW ADDITIONS TO THE TABLE
With price tags growing this year due to supply chain instability and low inventory, we’ll likely see a few new additions to our holiday meal tables, Jeff Zhou, CEO of Fig Loans, said.
“Some families choose to have multiple options for Christmas dinner, like having both a turkey and a ham. Low inventory of these in-demand food items may cause some families to choose one or the other during this holiday season,” he said. “I also think that some families may opt for more shelf-stable, low-cost options.”
For example, instead of making homemade stuffing, which might have a laundry list of ingredients, some families may opt for a boxed variety, Zhou said.
LESS PROMOTIONS
Shoppers are also on the hunt for deals this holiday season, Vericast found. The categories people were most interested in receiving a discount, coupon or offer for this season included grocery (61%), and restaurants (45%).
However, consumers may be in for a rude awakening, since it appears retailers are reducing the number of promotions they run in response to inflation, tight supply chains and a desire to rebuild profits previously lost during the pandemic, reported The Wall Street Journal.
Which issue do you feel will impact the food industry the most in 2022?
— The Food Institute (@FoodInstitute) October 25, 2021
