New research from First Insight, shared exclusively with Insider Intelligence, reveals that Generation Z consumers are leading the pack in terms of planned spending increases this holiday season. Compared to millennials, Gen Xers, and Baby Boomers, Gen Z individuals are 44% more likely to boost their holiday spending. The findings highlight that 36% of Gen Z respondents plan to spend more this year, surpassing millennials at 31%, Gen Xers at 21%, and Baby Boomers at 16%.
Despite varying spending intentions across generations, overall holiday spending is expected to be robust, with 81% of consumers planning to spend as much as or more than the previous year. Notably, concerns about pricing persist, influencing purchasing decisions. Although consumers are cautious about luxury goods, toys, and electronics, they remain focused on value.
Big-box retailers like Walmart and Target, along with discounters, are positioned to benefit from this trend. A significant 58% of consumers prefer to do their holiday shopping at big-box stores, while 47% opt for e-commerce marketplaces and 34% favor discount retailers.
To navigate this landscape, retailers are advised to implement various strategies, including promotions, to drive sales. Some recommendations include reconsidering or pausing return fees and extending return windows. A substantial 75% of shoppers reconsider patronizing retailers with return fees, and a similar proportion expects return policies ranging from 30 to 60 days.
Moreover, expanding gift card options can be a strategic move, given that 72% of shoppers, driven in part by Gen Z preferences, plan to purchase gift cards this holiday season.
As the holiday season draws near, consumers are preparing to embark on a mobile shopping spree. This anticipation is set to push the global shopping app market to new heights, with an expected surge of 1.7 billion downloads worldwide in Q4 2023.