Holiday shopping splurges are not uncommon, according to a new study conducted by Prosper Insights & Analytics for the NRF. Last year, four in 10 consumers spent at least $50 more than they originally budged for, and one in eight spent more than $200 than they planned to.
Although 43% of shoppers said they’re planning to be more conservative in their spending this holiday season, 90% could be convinced to extend their spending budgets by $25 for the right reasons – 51% of which said a really good sale or promotion was the main driver. Generation X shoppers are the most likely to give into a good deal at 55%. As such, the article expects that deals and discounts will be leveraged by retailers throughout the year to drive sales.
The second-most cited reason shoppers gave as to why they’d spend an extra $25 on holiday shopping is if they found the perfect gift for someone they originally hadn’t planned to buy for (34%). Millennials are more likely than their older counterparts to do so, and one in five in this generation said they’d open their wallets for something that’s hard to come by. More than one-quarter (27%) of consumers said they’d spend more if they found something they wanted for themselves. The article suggests retailers provide gift list ideas and reminders, as well as offer “limited-time” or unique items, to capitalize on shoppers who are motivated by these reasons to bend their budgets.
Free shipping with no minimum thresholds would get 27% of consumers to spend a bit more than they planned to. In fact, women (31%) are much more likely than men (22%) to do so. An easy return policy could entice 15% of shoppers 65 years of age and older to go over their holiday budgets. Finally, 17% of consumers said they’d be willing to spend an extra $25 if they needed supplies for a last-minute holiday party.
The article also mentions the rise of personal shopping and subscription services in recent years, which points to a growing desire among consumers for extra help and advice on finding what they need. Ten percent of shoppers said they could be convinced to purchase a higher-quality product than what they initially intended to buy, and others admit that a knowledgeable sales person could influence their decision to purchase something that wasn’t originally on their list.
Read the full article here, and contact JustEnough today to learn how our Price & Markdown Planning and Promotion Management solutions help retailers maximize sales and increase traffic by making it easy to set multiple price and markdown structures with complete visibility into inventory, revenue and margin impacts.