With economic woes in the national news headlines, the number of consumers who plan to spend less during this year's holiday season has already increased since August, according to a survey of 3,000 internet-using adults by Burst Media.
The survey found that one-third (33.8%) of respondents now expect to spend less on gifts and entertaining this holiday season compared to 2007, up from 26.9% in August. Slightly fewer than one-third (30.7%) said they will spend "about the same" as in 2007, while 16.6% will spend more, and 18.9% are unsure what their 2008 holiday spending will be.
Mothers aged 45+ plan to be the most frugal this holiday season with 43.8% planning to cut holiday gift and entertainment spending. The larger the family, the more likely this group is to cut holiday spending, reaching 53.8% in families with three or more children.
Perhaps more worryingly for marketers, respondents with higher household incomes also plan to pull back their holiday spending, as 39.3% of respondents with a household income of at least US$75,000 now plan to spend less, compared to only 25.3% in August this year.
A high point in this year's retail season may be the growth of online sales. More than half (55.2%) of respondents said they expect to make a holiday gift purchase online (up from the 48.8% who actually made an online purchase in 2007).
"Advertisers will need to redouble their efforts to reach consumers online," said Chuck Moran, vice president of marketing for Burst Media. "In a very challenging holiday season, the internet can serve as an effective medium to reach target audiences. Online media advertising also affords marketers the flexibility to quickly tailor advertising and offers for changing market conditions as they happen."
Other interesting findings the Burst survey revealed about online holiday planning and shopping included:
- Two-thirds (69.6%) of respondents will research potential holiday purchases online. The most popular online "window shopping" activities are: researching and comparing features of different brands (58.0%); and comparing different retailers to find the best price (57.8%). Men are more likely than women to say they use the internet to research and compare features of different brands (60.9% compared to 55.0%).
- Nearly three-quarters (73.4%) of respondents will use the internet to help plan holiday entertainment, including holiday crafts, recipes, and music. The expected use of the internet for holiday entertainment preparations spikes among various demographic segments, including women aged 35-54 (79.5%) and households with an income of US$75,000 or more (85.6%).
- 78.3% of online shoppers cite credit card security as a concern when making an online purchase. Online shoppers are also concerned with privacy of personal information (68.4%), shipping costs (66.3%), product quality (56.1%), a site's return policy (46.8%), product availability (44.3%), and shipping issues or delays (39.7%).