Holiday spending in the U.S. this year is projected to exceed $1.1 trillion, up more than 5% from 2017, according to an annual consumer survey from Deloitte, with $128 billion coming from online sales, about a 20% increase.
The annual spending binge is expected to account for more than a quarter of U.S. retail sales in 2018, according to Deloitte.
Almost half of those surveyed expressed optimism about the economy, Deloitte said, the highest number the consulting giant had seen in years, with unemployment low and consumer confidence high.
“Strong sentiment is a great start, but if you’re a retailer, it doesn’t guarantee a record season,” said Rod Sides, Vice Chairman of Deloitte’s U.S. Retail and Distribution division. “Many shoppers remain uncertain about what they’ll buy or where they’ll buy it. Consumers are making several stops online and in the stores along the way to figure it out.”
Most consumers answering the survey indicated they were early shoppers, with 60% saying they would start before Thanksgiving, spending $370 or 28% more than those who start later, Deloitte found. Forty percent said they would start on Black Friday, while 53% indicated they would shop on Cyber Monday.
Retailers will see traffic peak in between Nov. 16-30, according to Deloitte, with 72% of consumers planning to make purchases during this time. Households are expected to spend an average of $1,536 during the holidays.
On average, Deloitte found, shoppers will purchase 16 gifts and spend $525, up 20% from $430 last year. Gift cards and certificates are again popular, cited by 54% of respondents, at an average spend of $139.
Just over half of respondents (51%) said they will buy for themselves while shopping, up 15% over the last five years.
Fifty-seven percent of total spend is expected to be online, compared to 36% in stores, according to Deloitte, with the latter category declining 10% over the last four years. Sixty-six percent said they will do research online before purchasing, and retail stores and online search engines are tied at 56% each for inspiration.
“Online convenience is a way of life for most people, but what a person buys is still influenced by what happens in the store,” Sides said. “Shoppers also made it clear that promotions matter this time of year.”
Online retailers (60% of shoppers) and mass merchants (52%) are expected to be the top two shopping destinations, the Deloitte survey found, followed by department stores (32%) and off-price retailers (28%). Nearly 80% said they will make purchases on their PCs, while intent to purchase on mobile jumped from 57% last year to 67%.
Eighty-two percent of respondents said promotions influence their holiday shopping. Ninety-five percent said price discounts are the most appealing promotional offers, followed by free shipping at 75%.
Seventy-seven percent of U.S. consumers plan to shop at the same retailers as last year, with 75% saying they were open to discovering new ones. Finding a better price was the number-one reason for making a switch.
The Deloitte survey polled 4,036 consumers between Sept. 6-13, with a margin of error between 1%-2%.