Millennials Likely to Be the Biggest Spenders This Holiday Season, Accenture Survey Reveals
NEW YORK--(BUSINESS WIRE)--Oct 1, 2018--U.S. consumers expect to spend more money on holiday shopping this year than last year, with millennials likely to be the biggest spenders according to results of the 12th Annual Holiday Shopping Survey from Accenture (NYSE:ACN).
The online survey of 1,500 U.S. consumers found that Americans will spend $658 on holiday shopping this year, on average, compared with $632 in the 2017 survey. Nine in 10 respondents said they plan to spend as much or more than they did last year – 53 percent and 36 percent, respectively – with only 11 percent planning to spend less. Older millennials will spend $779, on average, while nearly four times as many younger millennials compared to baby boomers (49 percent versus 13 percent) said they plan to spend more this holiday season.
The research also found that retailers’ inclusion and diversity practices – with regards to age, gender, ethnicity and disability etc. – are playing a role in millennial shoppers’ purchasing decisions. The findings suggest that if a retailer is not authentically committed to prioritizing inclusion and diversity, millennials are likely to take their money to a competitor who is inclusive:54 percent of younger millennials surveyed believe that retailers have a responsibility and duty toward addressing wider social and political issues with regards to diversity. 51 percent of younger millennials are more likely to shop at a retailer that demonstrates awareness of such issues. Millennials are more likely to choose one brand over another if that brand demonstrates inclusion and diversity in terms of its promotions and offers (cited by 70 percent of younger millennial respondents and 69 percent of older millennials), their in-store experience (66 percent of younger and 72 percent of older millennials), their product range (68 percent of younger and 70 percent of older millennials), and their environmental awareness (61 percent of younger and 57 percent of older millennials). 31 percent of younger millennials see diversity in the workplace – with regards to staffing, as an important attribute when it comes to deciding where to shop.
“Our research suggests that the millennial generation has high expectations when it comes to retailers’ commitment to inclusion and diversity, and those values are influencing their decision-making in choosing one brand over another,” said Jill Standish, senior managing director and head of Accenture’s Retail practice. “National and multinational retailers serve diverse customer bases, so they need to position the brand accordingly – its messaging as well as its product selection. That will require not just more local decision-making, but also assistance from analytics tools that enable retailers to build a granular picture of their customers.”
Some other key findings from the survey:With growing consumer confidence, shoppers are less price-sensitive. Consumers appear less concerned with the economy and their overall financial situation than they were last year – with one-third less likely (15 percent, versus 23 percent last year) to cite “a concern about the economy” as a factor negatively affecting their holiday shopping this year. They were also less likely to cite “healthcare costs,” “mortgage payments,” “the prospect of higher taxes,” and “a recent job loss or the fear of losing their job”. This could be one reason why fewer shoppers plan to take advantage of retailers’ cost-savings programs or benefits – such as loyalty programs, on-the-spot competitor price-matching, special e-mail offers, Amazon Prime Day, and deal sites such as Groupon or Living Social. In addition, the number of respondents who said they would buy all their gifts in one place even if it meant paying more increased 7 points, to 32 percent this year. Service and/or “experience” gift-buying is on the rise. The research identified a growing trend away from product gifts such as toys, clothes and household appliances and toward “experience” gifts such as travel, dining out, concerts and the theatre, as well as toward “services” gifts such as lawncare, home cleaning and spa treatments. In fact, the number of shoppers who said they plan to buy physical products as gifts this year dropped 11 percentage points from last year, to 73 percent, and the number who said they planned to buy experience or service gifts increased 5 percentage points, to 49 percent. Social media is growing as a shopping platform. The use of social media platforms for holiday shopping is growing rapidly. The percentage of respondents planning to use social-media sites for their holiday shopping this year nearly doubled, to 15 percent from 8 percent last year. In addition, the percentage who said they check Instagram before looking or buying elsewhere online more than doubled, to 14 percent from just 6 percent last year.
“Social media continues to be a real disruptor in targeting today’s consumers, who are spending a great deal of time in these channels and naturally want to be able to purchase directly, through the click of a button,” Standish said. “Now, more than ever, it’s imperative for retailers to further rethink and redesign their digital shopping capabilities and methods so they can meet customers on their terms.”
Home for the holidays: Grocery category is new addition to this year’s survey
This year for the first time, Accenture’s survey included questions related to food shopping for the holidays. A key finding: quality matters, and shoppers are willing to pay more for it. Six in seven shoppers (86 percent) cited quality as “important” or “very important.” In addition, consumers are also likely to “trade up” when shopping for food this holiday season, with more than half (54 percent) likely to shop from a high-quality retailer and nearly as many (48 percent) likely to buy premium brands instead of the market’s own label.
When asked to select the factors that influence their purchases when shopping for groceries during the holidays, respondents most often cited “trust of the grocery provider and its products and services” – with 82 percent of respondents ranking it as one of the top three factors – followed closely by “offers best range of options so you can buy majority of items in one place” (78 percent). More than two-thirds (69 percent) of consumers cited convenience/location of the physical store as the key factor that would inspire them to purchase from a grocery provider they don’t normally go to.
The theme of “home for the holidays” seems to ring true, with more than one-third (35 percent) of survey respondents planning to host more holiday gatherings this year than last year. Millennials are leading the holiday hosting trend, with younger millennials (ages 21-27) 50 percent more likely than baby boomers to say they plan to host a Christmas meal or party (60 percent versus 40 percent) and to host a Thanksgiving meal (62 percent versus 41 percent) – and more than four times as likely as baby boomers to say they’re planning to host more holiday meals this year than last year. This might explain why they’re also more likely to trade up on the quality of the food brands they buy and the grocers from which they buy, as well as why they’re more likely than other age groups to purchase from a grocer they normally don’t shop at if that provider offers access to food at different stages of preparation (from raw ingredients to chopped-and-diced ingredients to ready-to-eat products).
“Holiday meals have historically been how we show we care for our loved ones,” said Standish. “It’s positive to see millennials, with their significant purchasing power, taking a greater interest in hosting these important holiday meals at home. And what an opportunity for grocery retailers to meet this generation of shoppers. If done right, it might be the start of a relationship that will last all year and beyond.”
About the survey
The Accenture Holiday Shopping survey offers insights into consumer buying patterns during the holiday time period, providing an indication of retail performance expectations both on the high street and online at a key time for the sector. For this year’s study, Coleman Parkes Research, on behalf of Accenture surveyed a representative sample of 1,500 U.S. consumers online. Respondents were split evenly between gender and by age group, with 20 percent each of Generation Zers (aged 18-20), younger millennials (21-27), older millennials (28-37), Generation Xers (38-54) and Baby Boomers (55 and older).
Accenture is a leading global professional services company, providing a broad range of services and solutions in strategy, consulting, digital, technology and operations. Combining unmatched experience and specialized skills across more than 40 industries and all business functions – underpinned by the world’s largest delivery network – Accenture works at the intersection of business and technology to help clients improve their performance and create sustainable value for their stakeholders. With 459,000 people serving clients in more than 120 countries, Accenture drives innovation to improve the way the world works and lives. Visit us at www.accenture.com.
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KEYWORD: UNITED STATES NORTH AMERICA NEW YORK
INDUSTRY KEYWORD: CATALOG DEPARTMENT STORES DISCOUNT/VARIETY LUXURY ONLINE RETAIL HOME GOODS SOCIAL MEDIA RETAIL COMMUNICATIONS FASHION SUPERMARKET
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