The holidays won’t be canceled
With a COVID-19 vaccine still months away from broad availability, many people are reluctant to go to stores and malls. So perhaps it’s not surprising that more than two out of three shoppers surveyed by CreditCards.com said they plan to do most of their seasonal shopping online this year.
But the pandemic isn’t the only factor driving this trend. Nearly 70% of shoppers said that convenience was the main reason they plan to shop online.
“During the lockdown, people got used to purchasing things in ways they might not have done before,” says Stacy Berek, managing director of GfK, a consumer products consultant. Older Americans who didn’t shop much online before have become more comfortable buying over the internet, she adds, and that trend will likely continue after the pandemic is over.
The economic downturn will dampen spending, as many families have been hit by furloughs, unemployment and high medical costs. But Deloitte predicts that holiday spending will still rise 1% to 1.5%.
With the coronavirus still a threat, even the most die-hard bargain shoppers may be disinclined to storm their favorite retailers in search of Black Friday discounts. Many big stores, including Walmart, Target and Best Buy, have announced that they’ll be closed on Thanksgiving Day. But you’ll be able to find plenty of deals without leaving the safety and comfort of your home. And you won’t have to do all of your shopping at once, either, because for many retailers, every day will be Black Friday.
Shoppers who procrastinate could face shortages of popular items, along with shipping delays. UPS says items sent via ground delivery should be shipped by Dec. 16 to arrive in time for Christmas. The deadline for packages sent via ground delivery through FedEx and the U.S. Postal Service is Dec. 15.
One way to avoid shipping delays is to give gift cards, which can be delivered electronically. But be careful. In recent months, several major retailers, including Lord & Taylor, Pier 1 and Modell’s Sporting Goods, have filed for bankruptcy, and more retailers are likely to disappear if the economic downturn stretches into 2021. When a retailer files for bankruptcy, gift card holders often have only a few weeks to redeem their cards before they become worthless.
Gift cards for local businesses could also lose their value if the retailer fails, says Ted Rossman, industry analyst for CreditCards.com. Although a check or general-purpose gift card is less personal, it’s a safer choice, he says.
The CreditCards.com survey found that debit cards were the most popular form of payment for holiday shopping this year. Forty-six percent of those surveyed said they planned to pay with debit cards, while 39% said they planned to use credit cards.
That may reflect consumers’ reluctance to run up debt at a time of economic uncertainty, Rossman says. But when you forgo credit cards, you give up numerous benefits, including the ability to dispute the charge if an item is damaged or stolen. In addition, many credit cards offer rewards that can save you money.