Link between shopping, Christmas growing stronger
For much of the retail sector the winter holiday season now starts in August. That makes some sense, given that 85% of Americans reported plans to purchase gifts for friends and family in a NerdWallet survey this fall. The National Retail Federation forecast for holiday spending is up again for 2023, projecting something between $957 billion and $966 billion in total sales in November and December alone. Though the economy remains a top concern for many, Statista reports that almost one in five of us expects to spend more on gifts this year than last, while 58% anticipate spending the same. There's little evidence many people will be cutting back, which is good news for retailers.
Retail sales, of course, are key to the American economy and central to our collective culture, holidays or no. In 2000 total retail sales in the U.S. amounted to nearly $3 trillion; by 2022 they exceeded $7 trillion in nominal dollars. Over the same time period holiday spending, defined as Thanksgiving to Christmas by the National Retail
Federation, grew from roughly $400 billion to $930 billion. This year close to one in seven retail dollars will be spent during the holiday season, so it's no wonder retailers are competing for our attention. They'll do that with sales in particular, since the majority of consumers surveyed by PwC for their 2023 Holiday Outlook report said that price was the most important factor in their purchase decisions. Fully 75% agreed they would be “hunting for deals” this shopping season.
After price, convenience has become a critical factor in shopping decisions for many. Online shopping is now preferred by 43% of Americans, the highest of any national population surveyed by Klarna last spring. The most popular category for online sales is clothing (sought by 43% of online shoppers) followed by shoes (33%), and then things like handbags, personal care products, and pet supplies (each around 25%). Interestingly, generational differences in experience with online shopping are not that profound; in 2021 Baby Boomers were the most likely to shop online but were only 1% more likely to do so than Gen X and just 7% more than Millennials.
How much we'll spend varies of course. Individual estimates of holiday spending averaged $923 in a recent Gallup survey of adults, close to average over the last 20 years and only about $200 higher than the low points surrounding the Great Recession. Depending on whose figures you use to estimate median household income, two “representative” adults in Minnesota would be dedicating 2% to 3% of their annual income to gifts this year. That seems modest at face value — like normal discretionary spending. But NerdWallet found 52% of their survey respondents borrowed to pay for Christmas gifts in 2022 and 31% are still paying off those balances, mostly on credit cards at high interest rates. 74% said they plan to use credit cards to pay for gifts again this year and 27% expect to go into longer-term debt to do so.
Where we shop, how we shop, and how much we plan to spend for the holiday season varies a bit from year to year. The linkage between Christmas and shopping, though, appears to be growing stronger as the country becomes less Christian — and less religious in general. A Pew Research study from 2022 noted that while 90% of Americans identified as Christian in 1972, only 64% did so in 2020. Projecting the trend forward another half-century they estimated a minority — only 46% — would identify as Christian in 2070 if current patterns continue. Rising “disaffiliation,” people leaving religion entirely, could drive that minority into the 35% to 40% range. So looking out a generation or two we might anticipate the religious aspects of
Christmas will fade even more — probably to be further supplanted by the consumerism at the core of American culture.
Last December an Ipsos survey found that three-quarters of us believe “Most Americans have forgotten the true meaning of Christmas.” But it seems that a large majority remembers each fall that shopping, if not the entire “reason for the season,” is the central feature of our winter holiday celebrations.