I hate the Christmas creep. It's a great holiday, but I'm annoyed when I see Christmas decorations on store shelves before Halloween hits.
I want to enjoy the autumn before I have to start thinking about winter, but I get it from a business perspective. You have to think ahead to get the sales you need, and if you can make, or even extend, those sales by putting out the merchandise sooner, it makes sense to do it.
Consumers, at least sometimes, think ahead, too.
The annual holiday retail survey conducted by Deloitte found 57% of U.S. consumers expect a weaker economy moving forward and 77% said they expect higher prices on holiday items this year. That's up from 30% and 69% in 2024, respectively.
The survey found consumers overall plan to spend less this holiday season, coming in at an average of $1,595 compared to $1,778 in 2024. Among the different age groups, Gen Z and millennial consumers are expected to pull back the most on spending, down 34% and 13% year over year. Even baby boomers are forecast to pull back by 6% this year. Gen X consumers are expected to spend about 3% more.
“We’ve been talking about the resilient consumer for a while now, that despite all these pressures, the U.S. consumer continues to spend and we keep seeing growth and spending for retail,” Brian McCarthy, retail strategy leader for Deloitte, told CNBC. “This outlook is starting to suggest that we’re getting towards the end of that resilience.”
The potential bright spot for hoteliers in this reading of consumers' mindset is that 47% plan to give experiential gifts this year, up from 39% in 2024.
Consumers are watching for a deal this holiday season. Seventy-five percent said they'll shop during October and Thanksgiving week deals, up 7% year over year, and 49% said getting a great deal would be the top factor in deciding where they shop. They're not feeling especially loyal, as 65% said they would shift brands if the one they prefer is too expensive.
We know consumers are feeling squeezed. We've seen for months the bifurcation in hotel demand, with economy and midscale hotels struggling while higher-end hotels benefit from wealthier guests who have enough disposable income for luxury stays.
Hopefully this survey gives you all a bit more insight into how consumers are prioritizing their spending as we get closer to the end of the year and helps you adjust your strategies.
In the meantime, I'm going to continue to try not to ground my older son who thinks its funny to play Christmas songs before November.
You can reach me at bwroten@hotelnewsnow.com as well as on LinkedIn.
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