Thirty-seven percent of Americans surveyed by Edward Jones plan to spend less on holiday shopping this year than last year, contrary to company's retail forecasts for remainder of year, which call for solid numbers from most retailers
November 5, 2013
Consumer Plans Inconsistent with Analyst Expectations for 2013 Holiday Season
According to a recent survey by financial services firm Edward Jones, some Americans are planning to hold on to their wallets this holiday season. In fact, 37 percent say they plan to spend less on holiday shopping in 2013 than they spent in 2012, contrary to what Edward Jones' retail analyst is anticipating: holiday sales to increase by about 2.8 percent.
"While we expect some sales growth in the retail market this holiday season, those polled expressed a conservative view on holiday spending," said Brian Yarbrough, consumer discretionary analyst for Edward Jones. "This differs from our retail forecasts for the remainder of the year. We anticipate solid numbers from most retailers with luxury players leading the charge."
The survey, conducted during the government shutdown, provides a unique perspective into how the political landscape and other short-term events may impact consumer spending behaviors. More than one-third (37 percent) plan to spend less on holiday shopping in 2013 than they spent in 2012, and another 39 percent say their shopping budget will be the same. Just 18 percent plan to spend more this year.
"Americans have been inundated by negative headlines regarding changes in economic policy, the impact of rising interest rates and disparate political views coming out of Washington," said Yarbrough. "It's clear that these issues have heightened uncertainty and caused individuals to second-guess their saving and spending behaviors. However, it's important to stay the course and take a long-term approach to spending, saving and investing, especially with all of the short-term uncertainty."
Additional highlights from the survey include:
Shopping Early to Take Advantage of Promotional Deals
Of Americans planning to buy holiday gifts this year (79 percent), 24 percent have already started to tackle their lists. Less than half (43 percent) plan to conduct their shopping before Thanksgiving, about one-quarter (26 percent) plan to take advantage of Black Friday or Cyber Monday sales, and one-third (32 percent) say they will wait until December to get started. In a bearish admission, 16 percent of those who have traditionally purchased gifts for the holidays say they will not be doing so this year.
Younger Shoppers Most Likely to Spend
Respondents between the ages of 18 and 34 are the most likely to spend more in 2013 than in 2012 (35 percent), while only 12 percent of respondents ages 35 and 44 plan to spend more. Nearly half of respondents 55 and older plan to spend the same as 2012.
Youngest Americans Likely to Spend on Marquee Shopping Days
The survey's youngest respondents, those between the ages of 18 and 34, are far more likely to shop on Black Friday or Cyber Monday, with one-quarter indicating they plan to do so, compared with just 13 percent of Americans ages 55 and older. While 89 percent of respondents ages 18 to 34 plan to conduct holiday shopping this year, only 64 percent of respondents 55 and older plan to do the same.
Larger Households More Likely to Conduct Holiday Shopping
When taking household size into consideration, 91 percent of Americans with three or more individuals in their household plan to shop for the holidays this year, compared with 59 percent of single-person households. The trend continues between the two groups regarding their plans to conduct holiday shopping on Black Friday or Cyber Monday. In households with three or more members, 26 percent say they plan to shop during those particular days, as opposed to just 11 percent of single-person households.
Additionally, almost one-third (29 percent) of single-person households and just 6 percent of households with three or more people do not plan to buy holiday gifts this year but have in the past.
About Edward Jones
Edward Jones provides financial services for individual investors in the United States and, through its affiliate, in Canada. Every aspect of the firm's business, from the types of investment options offered to the location of branch offices, is designed to cater to individual investors in the communities in which they live and work. The firm's 12,000 financial advisors work directly with nearly 7 million clients to understand their personal goals – from college savings to retirement – and create long-term investment solutions that emphasize a well-balanced portfolio and a buy-and-hold strategy. Edward Jones embraces the importance of building long-term, face-to-face relationships with clients, helping them to understand and make sense of the investment options available today. Edward Jones, which ranked No. 8 on FORTUNE magazine's "100 Best Companies to Work For 2013," is headquartered in St. Louis. The Edward Jones website is located at www.edwardjones.com, and its recruiting website is www.careers.edwardjones.com. Member SIPC.
Survey was conducted by ORC International's CARAVAN Omnibus Services and was based on 1,005 landline and cell phone interviews of U.S. adults conducted October 10-13, 2013. The margin of error was +/-3%. Of the total sample, 787 respondents indicated they were planning to shop for holiday gifts this year. The margin of error for this sub-group was +/- 3.5%.
SOURCE Edward Jones